Pensions 2026

Overview of Global Pensions Trends in 2026

Occupational and supplementary pensions are becoming increasingly important in retirement systems around the world. The pressures behind that shift are shared. Populations are ageing. The ratio of workers to retirees is declining. The long-term financing of state provision is under growing scrutiny. In the European Union, for example, the old-age dependency ratio (the proportion of people aged 65 and over compared to the working-age population) increased from 26.8% in 2004 to 37% at the start of 2024. It is expected to continue rising as larger older cohorts remain in retirement and smaller working-age cohorts support them. Across Asia and the Pacific, the OECD projects that the old-age-to-working-age ratio will more than double over the next three decades.

This guide principally concerns second-pillar pensions: workplace or occupational arrangements that sit between public pensions and purely individual savings. The terminology differs across jurisdictions: the United States contribution analyses employer-sponsored qualified plans, the Netherlands and Switzerland contributions describe occupational pillars, and the Brazilian contribution focuses on supplementary pension arrangements in a system where formal employment remains central to coverage. What connects these systems is not identical legal design, but a common set of questions about risk allocation, governance, coverage, investment policy, and member protection. This introduction and the guide as a whole set out to explore how the law structures retirement savings beyond public pensions.

Adequacy, coverage and the role of occupational pensions

Adequacy is the practical reason why second-pillar pensions are important. As public, pay-as-you-go provision (in which today’s workers fund today’s retirees) comes under strain, occupational and supplementary pensions are expected to play an increasingly important role in maintaining living standards in retirement. Yet coverage remains uneven, both within advanced systems and across regions where formal employment is less widespread.

The EU’s 2024 Pension Adequacy Report analyses whether pension systems prevent old-age poverty, maintain living standards and address the inequalities that pension design can entrench. The OECD projects that a worker on an average wage with a full career, entering the labour market today, will retire on a net pension worth approximately 63% of their previous earnings. There is, however, wide variation between countries. In Africa, only around 17.4% of the population is effectively covered by at least one social protection benefit, and it is estimated that only 27.1% of older people receive a pension. These figures do not relate to occupational pensions, but they illustrate why expanding coverage is a key topic in the global discussion on retirement income beyond public pensions.

The structural shift from defined benefit to defined contribution

Another well-documented inequality is the gender pension gap: across OECD countries, women receive monthly pensions that are about one quarter lower than those of men, a gap that has narrowed from 28% in 2007 to 23% in 2024, but which remains substantial. This is mainly driven by gender differences in lifetime earnings, with differences in employment, hours worked, and hourly wages each contributing about one third. The distributional consequences of pension design affect different sections of the population unevenly, and this is a theme that runs through the following chapters.

The defining trend of the past two decades has been the decline of the defined benefit (DB) model, in which the employer or fund guarantees a specified retirement income, typically calculated based on salary and years of service. Unwilling or unable to carry longevity and investment risk on their balance sheets, employers have progressively closed DB arrangements in favour of defined contribution (DC) structures, in which members save into individual accounts and bear investment risk.

The scale and pace of this shift varies by jurisdiction, but the direction is broadly consistent. In the United States, DC plans (principally 401(k) arrangements) have long been the dominant option, and the SECURE 2.0 Act further increases reliance on individual account-based saving, including through automatic enrolment for new covered plans. In the Netherlands, the Future Pensions Act (Wet Toekomst Pensioenen) requires all remaining occupational DB schemes to convert to DC schemes by 1 January 2028, representing a system-wide transition without recent parallel.

In Brazil, closed pension funds have gradually shifted from DB to DC and variable-contribution arrangements over the past few decades, changing how retirement risk is allocated. Switzerland’s occupational pillar is largely savings-based during the accumulation phase. However, the mandatory portion retains statutory minimum features, such as a conversion rate of 6.8%. A 2024 referendum to lower this rate was rejected. The OECD confirms the breadth of this wider trend, reporting that defined contribution and personal plans now hold more than half of pension assets in 21 out of 25 reporting economies.

In many systems, the result is a reallocation of risk: members increasingly bear the investment outcome, even though it is usually the pension fund or provider that acts as investor and makes investment decisions, rather than the member. The regulatory response is a key theme throughout this guide, covering topics such as the extent to which providers must inform and guide members, how default investment options should be constructed and governed, and how communication obligations are enforced.

Longevity risk and the decumulation challenge

The shift to DC has not only reallocated investment risk, but has also transferred longevity risk (the risk of outliving one’s savings) to individuals. The question of adequacy therefore extends beyond the accumulation phase into the so-called decumulation phase, which concerns how accumulated capital is converted into retirement income and whether that income will last. In Brazil, the Trends and Developments article reports an increase in regulatory attention to the adequacy and long-term viability of DC and variable-contribution arrangements, signalling a shift from accumulation to outcomes. In Switzerland, the rejected 2024 reform left the statutory minimum conversion rate unchanged, leaving the tension between pension levels and financing pressure unresolved. These are not isolated developments. They reflect a growing recognition across jurisdictions that the adequacy of a DC pension is not determined at the point of contribution.

Governance, fiduciary duty and the prudent person

The reallocation of risk to members means that the governance of pension institutions and the legal standard to which those who manage retirement savings are held are at the centre of pensions law. Different jurisdictions have developed different models. In the United States, for example, the Employee Retirement Income Security Act (ERISA) requires fiduciaries to act solely in the interests of plan participants and with the care, skill, prudence and diligence of a prudent person familiar with such matters. This is reinforced by personal liability for plan losses and strict prohibited-transaction rules. In Switzerland, the governing board must comprise equal numbers of employer and employee representatives, who are personally liable for breaches of duty, while independent gatekeepers (an accredited pension expert and an auditor) provide external oversight. In the Netherlands, the accountability body and supervisory board perform analogous functions within the pension fund governance framework, and each fund is required to designate key function holders for risk management, internal audit and actuarial matters. Recent supervisory inspections in Brazil have focused specifically on the functional independence of directors, transparency in decision-making, and the sharing of structures and personnel between sponsors and pension funds. One of the central questions the guide’s chapters address is how jurisdictions calibrate the duty of care when outcomes are, by design, uncertain.

The self-employed and changing labour markets

The traditional pension architecture was built around formal employment and employer sponsorship. However, as labour markets change due to the rise of self-employment, platform work and engagement through corporate vehicles, the question of who is covered becomes increasingly important.

In the Netherlands, most self-employed individuals remain outside the second pillar. Mandatory sector schemes extend to the self-employed in only a few sectors, and the Future Pensions Act brought no substantial change to this. In Brazil, the system’s historic dependence on employer sponsorship means that independent contractors do not have access to occupational savings. In Switzerland, the self-employed can choose to join the occupational pillar or make enhanced tax-privileged contributions to the private tier, but compulsory coverage does not apply.

Several jurisdictions are experimenting with auto-enrolment (the automatic entry of individuals into a pension scheme with the right to opt out) as a means of broadening occupational or supplementary coverage without imposing a fully mandatory model. Brazil’s contribution suggests a move towards auto-enrolment arrangements for certain benefit plans in 2024. In the United States, the SECURE 2.0 Act requires 401(k) and 403(b) plans, established on or after 29 December 2022, to automatically enrol eligible employees for plan years beginning after 2024, subject to certain exceptions. At the EU level, the Commission has issued non-binding recommendations encouraging member states to adopt auto-enrolment. However, the Netherlands has taken a different approach. Since the 1950s, the Minister of Social Affairs and Employment has had the power to make participation in an industry-wide pension fund (bedrijfstakpensioenfonds) compulsory for all employers and employees in a given sector, at the request of the social partners. This long-established system of mandatory affiliation (verplichtstelling) means that the vast majority of Dutch employees accrue occupational pension rights, achieving broad coverage without relying on auto-enrolment. The variety of approaches matters: whether through auto-enrolment, mandatory affiliation, or other techniques, jurisdictions are pursuing wider pension coverage, but they are grafting these solutions onto very different pension systems.

The EU’s regulatory agenda

At the level of the European Union, regulatory activity in the second pillar is especially intense. Pensions have become a central plank of the Savings and Investments Union (SIU), the Commission’s strategy for channelling household savings into the EU’s capital markets. Against the backdrop of the Draghi report’s estimate that the EU requires an additional EUR750–800 billion of investment each year to meet its competitiveness objectives, supplementary pensions are increasingly viewed as a social good and a source of long-term capital.

The centrepiece of this activity is the review of the IORP II Directive (Directive 2016/2341/EU), which provides the framework for institutions for occupational retirement provision (IORPs). These are the vehicles through which second-pillar pensions are organised across the EU. The review is being conducted alongside the Pan-European Personal Pension Product (PEPP) Regulation. On 20 November 2025, the Commission published its supplementary pensions package; on 26 June 2026, the Council agreed its negotiating mandate; and parliamentary committee work was still ongoing in July 2026. The Commission’s proposal would introduce a single depositary model for defined contribution (DC) schemes, simplify cross-border transfers and mergers, and clarify the prudent person principle to encourage investment in both private and listed equity. Another proposal would require funds to notify their supervisor if their performance deviates significantly from the applicable benchmark. Industry concern focuses less on transparency as such than on the risk that supervisory benchmarking could encourage benchmark-hugging and discourage long-term, illiquid or alternative investments.

Sustainability, technology and mobility

Three further themes cut across second-pillar systems: sustainability, technology and mobility. Pension funds are at the centre of the debate over sustainable investment because they are long-term asset owners. However, jurisdictions are diverging sharply on how fiduciary duty should accommodate environmental, social and governance factors. In the United States, the ERISA framework currently in place ties investment decisions to risk-and-return factors. However, litigation and policy shifts continue to make ESG a contested area for plan fiduciaries. In Brazil, the Trends and Developments article reports that investment regulation for closed pension funds is moving towards integrating material sustainability factors into risk assessment.

The second theme is technology and digitalisation. From pension-tracking systems that provide members with a consolidated view of their entitlements, to the modernisation that a cross-border market would demand, technology is reshaping both the member experience and the supervisory toolkit. It also brings legal exposure, including data protection, cybersecurity and operational-resilience issues, which are increasingly part of the pensions lawyer’s remit.

The third issue is mobility. As workforces become more international, the portability of accrued occupational pension rights and the tax treatment that follows mobile members across borders become ever more pressing. In the EU, the discrepancy between the free movement of workers and the limited portability of their pension entitlements remains unresolved, and this issue extends far beyond Europe.

About this guide

This guide examines how these second-pillar and supplementary-pension issues are being addressed in individual jurisdictions. Each chapter, written by leading local practitioners, outlines the legal and regulatory framework governing occupational and supplementary pensions in that jurisdiction. This includes everything from the structure of the system and the role of providers to benefit design, funding, tax, and dispute resolution. The Trends and Developments articles take a closer look at issues of particular current significance, including the treatment of pension arrangements in corporate transactions. Read together, they provide a sense of how shared pressures are producing diverse legal responses, and where the law of retirement provision beyond public pensions may be heading next.