Hong Kong retirement system slips to 18th rank in Global Pension Index
This latest ranking is one spot lower than last year.
Hong Kong’s ranking in the annual Global Pension Index dipped one spot in 2021 despite an increase in its index value from 61.1 last year to 61.8 this year.
Last year, Hong Kong ranked 17th on the index.
The city however was able to maintain its ranking amongst Asian countries for the third year at number two, just behind Singapore.
Hong Kong also showed improvement in its scores across the sub-indices measured, even receiving the highest integrity score in Asia and fourth globally with 87.7. For adequacy and sustainability, the city scored 55.1 and 51.1, respectively.
The Mercer CFA Institute gave HK’s pension system a C+ grade which connotes that the city’s pension system “has some good features, with areas that should be addressed over time.”
Hong Kong received the same grade as the USA, France, and Belgium.
The institute however noted that there is still “work to be done” to address the gender pension gap in Hong Kong.
Citing data from The Women’s Foundation, a non-profit organisation, there is an average gender pay gap of 22% in Hong Kong, and about 30% of working mothers “confront biases at work and drop out of the workforce due to caring responsibilities.”
Women also account for only 13.9% of directors in Hong Kong-listed companies.
“The pension gap between genders is arguably a consequence of differences in remuneration and working period, with women more likely to leave the workforce for family reasons, and this gap can only close with greater awareness and deliberate actions from employers and the government,” Adeline Tan, Mercer’s wealth business leader in Hong Kong, said.
The latest edition of the index reviewed the retirement systems of 43 countries.
Iceland, which was among the four new additions in the 2021 edition, ranked first in the index.