Melbourne Mercer Global Pension index has become an important reference point in the debate about the adequacy, sustainability and integrity of retirement systems around the world. While some countries have well-established retirement systems that have stood the test of time, others are just developing, especially those within the Asian region. Regardless, as nations and policy makers struggle with the competing needs of an ageing population and achieving an appropriate fiscal balance, our hope is that this report will provide an opportunity for debate and discussion about possible alternative strategies.
The Index uses three sub-indices —adequacy, sustainability and integrity — to measure each country's retirement income system. The overall index value for each country's system represents the weighted average of the three sub-indices. The weightings used are 40 percent for the adequacy sub-index, 35 percent for the sustainability sub-index and 25 percent for the integrity sub-index. The different weightings are used to reflect the primary importance of the adequacy sub-index which represents the benefits that are currently being provided together with some important benefit design features. The integrity sub-index considers several items that influence the overall governance and operations of the system which affects the level of confidence that the citizens of each country have in their system.