BOSTON–NOVEMBER 9, 2023–(BUSINESS WIRE)–NEPC, LLC, one of the country’s largest research-driven investment consultants and OCIO providers, today published the 11th annual edition of its Defined Benefit (DB) Trends Survey, which examines funded status (“F/S”), forward-looking expected return on assets (EROA), and shifts in investor sentiment. Respondents to the 2023 survey included 51 corporate and healthcare organizations with the majority of plans ranging in size from $100 million to over $3 billion.

This year’s data showcases that 53% of respondents have a bearish view of markets over the next 12 months. Respondent sentiment demonstrates a full reversal from the results of the 2021 survey, where (56%) of respondents were bullish and 44% of respondents were bearish.  NEPC noted that clients are more focused on their funded status position rather than their portfolio’s absolute return amidst this period of macroeconomic market volatility.

“It pays to be a saver. Higher rates and higher inflation are typically good news for funded status and frozen plans as higher discount rates reduce the value of liabilities. While equity valuations are down, forward-looking return assumptions (especially for fixed income investments) fare better,” said Jake Mallinson, Consultant on NEPC’s Defined Benefit team. “Armed with an understanding of the proactive drivers of volatility, NEPC has been working with clients to pull on different levers, such as maintaining a disciplined hedging strategy, to ensure plan sponsors are best able to navigate sustained volatility.”

NEPC’s 2023 survey results also show the continued climb in funded status among DB plans. 74% of plans in the 2023 Survey reported a funded status above 90%, a noticeable increase from 2021, where only 63% of plans were above 90% funded. Large plans (over $1B) reported better funded status than small plans (under $1B). 65% of large plans reported a F/S of over 100% while only 23% of small plans reported a similar status.

“Total DB pension assets are dropping due the Feds efforts to combat inflation.  Meanwhile, discount rates are also rising, and plans’ funded statuses are increasing as interest rates are going up. Environments like this demonstrate why liability driven investments work, especially as a risk management tool,” said Brad Smith, Partner on NEPC’s Defined Benefit team. “NEPC continues to advise plan sponsors to utilize glide paths and take action to further “de-risk” plans.”

Other key trends highlighted in NEPC’s new survey:

  • There seems to be a shift to allocating more assets to LDI from prior years. On average, respondents had 41% of assets allocated to LDI compared to survey results in 2021 where only 30% of assets were allocated to LDI.
  • Forward-looking Expected Return on Assets (EROA) reversed course and are trending higher than in previous surveys. 71% of plans indicated they had an EROA of 6% or higher in 2023, a significant jump from NEPC’s most recent data in 2021, where only 52% of plans had an EROA of 6% or higher.
  • Respondents still fear a slowdown in global growth is imminent as 42% of respondents selected this as their greatest threat to their investment programs this year.
  • 40% of respondents expect Pension Discount Rates to remain the same level over the next year. However, 32% of respondents expect Pension Discount Rates to fall during that same time period, which is surprising given the Fed has stiffened its stance around staying committed to a more hawkish monetary policy going forward.

The Defined Benefit (DB) Trends Survey results can be downloaded here.



NEPC is an independent investment consultant, private wealth advisor, and OCIO provider serving over 400 retainer clients and $1.4 trillion in total assets. Combining a proprietary research team dedicated to the long-term challenges facing investors with our unique client-centric model, NEPC builds forward-looking investment portfolios for institutional investors and ultra-high-net-worth individuals. To learn more about NEPC, visit


Media Contact:

Emma Rayder

[email protected]