Abstract
The current survey aims to draw a perspective on the social investment of pension funds in Russia. The author defines the concept within the context of the Conventions Theory. The practice of the social investment of pension funds presupposes a complex architecture of social order that combines dominant domestic market world principles with elements from the civic and industrial world. The new order is achieved through a compromise of domestic value orientations and the competition for pension funds, the collective character of investments with its temporal and spatial attachment, calculation of risks and profits, as well as focus on results. The study employs a qualitative research with a regression analysis. The results indicate that in St. Petersburg (Russia), despite the individuals’ pessimism towards the pension system, there is a glimmer of interest in this issue. Respondents admit the likelihood of socially responsible investing their pension funds in case the rate of return on these investment projects will not be less than the interest on bank deposits. The important factors of attracting pension funds in social projects are: the local character of investment projects, the short-term individual consumption perspective, and the state regulation of social investment market. The author concludes that social investing has a potential to become an alternative way in the pension system evolution in Russia. DOI: 10.5901/mjss.2015.v6n6p170
Highlights
The starting point in the debate on the reform of the pension system was a World Bank report «Averting the old age crisis» in 1994
As I study a correlation between cultures and the decisions made about the investment of pension funds, it is important to examine what are respondents’ values and beliefs (De Bondt, 2004)
There is a significant skepticism about the government programs because they tend to be ineffective, and many say that the distribution of the budget into social projects is falling (85%)
Summary
The starting point in the debate on the reform of the pension system was a World Bank report «Averting the old age crisis» in 1994. Welfare states faced with the problem of choosing the appropriate approaches to reforming the pension system. States have begun to reconsider the basic principles of the pension sector and rebuild its institutions. Russia is no exception; it adopted new pension legislation, created pension services market, and introduced new principles of pension rights and the calculation of pensions. In Russia, the pension reform began more than 20 years ago. Its mechanism has been radically changed, four times. It is time to reflect on its first results to assess whether the direction of reform has been chosen correctly and to think about its future
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