Pension Fund Administrators and Financial Transparency of Retirement Savings Funds in Nigeria
Abstract
The study examined Pension Fund administrators and Financial Transparency of Retirement savings funds of Nigeria. The paper posit that pension fund administrators faces numerous challenges that hampers financial transparency in the management of retirement savings funds of Nigerian retirees. Using an historical method involving a critical but systematic analysis of secondary data, the findings revealed amongst other things that in Nigeria, low level of transparency and compliance had been reported among operators of Nigerian Contributory Pension Scheme. The studies documented unsatisfactory level of transparency and compliance among Contributory Pension Scheme operators and employers of labor in Nigeria. In exploring issues of transparency and accountability in pension fund administration in Nigeria, it was revealed that corruption remains a pervasive challenge in Nigeria, and pension fund administration is not immune. It was also revealed that there are gaps in regulatory oversight and enforcement. Inadequate monitoring and supervision can allow malpractices to go unchecked. Insufficient transparency in reporting practices was also identified to hampers stakeholders' ability to assess the performance and integrity of pension fund administrators. Furthermore, lack of adequately trained personnel within regulatory bodies and pension fund administrators with Insufficient expertise in governance, risk management, and financial oversight hinders efforts to promote transparency and accountability. Finally, political interference in pension fund administration was also identified as undermining transparency and accountability efforts. Nepotism, favoritism, and patronage networks was in addition noted to influence decision-making processes, compromising the integrity of the system. Based on these findings, the following recommendations were outlined: PenCom should take the challenge of technological advances seriously by modernizing its systems, because the traditional approaches to business management is fast fading out. The adoption of Information and Communication Technology based methods instills reliability and confidence in the information produced. Second, PenCom should engage in effective oversight and monitoring of the PFAs and PFCs to ensure compliance with the provision of the Act. More so, government should empower PenCom to summon the Chairmen, Directors or Managers of non-compliant employers and impose severe sanctions on them. Above all, PenCom should embrace high level standard of corporate governance. While tapping into global expertise for training and education of staff, systems development, technology and information communication technology.
Keywords: Pension, Transparency, Accountability, Fund Administrators
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