In October 2025, Mercer, an American consulting firm, released a report titled “Mercer CFA Institute Global Pension Index (MCGPI) 2025”, in collaboration with Chartered Financial Analyst (CFA) Institute and Monash Centre for Financial Studies (MCFS). As per the report, India has ranked 52nd, the lowest in the index, with overall index grade “D” with a score of 43.8 out of 100, slightly down from 44.0 in 2024. Other countries in Group D include Turkiye (48.2), the Philippines (47.1), and Argentina (45.9).
- The Netherlands topped the Pension Index with 85.4, followed by Iceland at 84.0 and Denmark at 82.3.
Exam Hints:
- What? Release of Mercer CFA Institute Global Pension Index 2025
- Who? Mercer, CFA Institute, Monash Centre for Financial Studies
- Edition: 17th (2025)
- Coverage: 52 countries (65% of global population)
- India’s Rank: 52(Grade D)
- Grade A Countries: Netherlands, Iceland, Denmark, Singapore, Israel
- Singapore: Scored 80, first Asian country to achieve Grade A
- Grade D countries: Turkiye, Philippines, Argentina, India
- Sub-Index top performers: Kuwait (Adequacy), Iceland (Sustainability), Finland (Integrity)
About Mercer CFA Institute Global Pension Index:
Overview: MCGPI is an annual global ranking of pension systems that highlights strengths, weaknesses, and reform needs to ensure adequate, sustainable, and transparent retirement income.
Edition: MCGPI 2025, the 17th edition of the report, evaluates the retirement income systems of 52 countries, representing 65% of the world’s population.
Newly Added countries: In the 2025 edition, countries such as Kuwait, Namibia, Oman, and Panama have been newly added to the index.
Sub-index: It benchmarks systems based on the three pillars such as:
- Adequacy (40%):Assesses benefit levels, including minimum pensions, replacement rates, and household savings.
- Sustainability (35%): Evaluates long-term viability considering demographics, economic growth, public debt, and system creditworthiness (2%).
- Integrity (25%): Measures governance, regulation, and communication effectiveness.
Grading System: Based on the performance, each country is assigned an overall grade from A to E. It encompasses:
- A (80–100): Robust, sustainable, high-integrity pension system with good benefits.
- B/B+ (65–79): Sound system with minor areas for improvement.
- C/C+ (50–64): Good features but major risks need addressing for effectiveness.
- D (35–49): Some desirable features but significant weaknesses.
- E (0–34): Poor or underdeveloped pension system.
Highlights of MCGPI 2025:
Top 5 Countries in MCGPI 2025:
| Rank | Country | Overall Index Score | Overall Index Grade |
|---|---|---|---|
| 1 | Netherlands | 85.4 | A |
| 2 | Iceland | 84.0 | A |
| 3 | Denmark | 82.3 | A |
| 4 | Singapore | 80.8 | A |
| 5 | Israel | 80.3 | A |
| 52 | India | 43.8 | D |
Global Performance:
Grade A Pension Leaders: The Netherlands, Iceland, Denmark, Singapore, and Israel secured a Grade A ranking in the Pension Index, with the Netherlands leading as it transitions from a collective system to a Defined-Contribution (DC) structure under the Future Pension Act.
- Singapore secured an overall score of 80.0, becoming the first Asian country to achieve a Grade A ranking.
Grade B+ Performers: Sweden, Australia, Chile, Finland, and Norway secured a Grade B+ ranking in the Pension Index.
Improvements: As part of the improvement of retirement income provision worldwide, eight countries have improved their index grades. It includes Singapore (A Grade), Chile (B+), Sweden (B+), Hong Kong (Special Administrative Region, SAR) (B), Kazakhstan (B), Saudi Arabia (B), Malaysia (C+), and South Africa (C).
- The grade of no country was downgraded in 2025 report.
New Entrants: It includes Kuwait with a score of 71.9 and Grade B, Namibia (59.1) (Grade C), Oman (60.9) (C+), Panama (59.1) (C).
Sub-Index Leads: Kuwait leads the “Adequacy” sub-index with a score of 86.6, Iceland tops the “Sustainability” sub-index with a score of 85.7 and Finland leads the “Integrity” sub-index with a score of 90.6.
India Performance:
Overview: India with its score of 34.7 in “Adequacy” sub-index, Sustainability (43.8), and Integrity (58.4) has scored 43.8 compared to 44.0 in 2024.
Challenges: The report cites low workforce participation (under 25%), low income replacement rates, long-term fiscal stress, and fragmented pension schemes with varying regulations causing inefficiencies and coverage gaps.
Retirement System in India: It includes earnings-based employee pension scheme, DC Employee Provident Fund (EPFO), Employer-Managed DC pension schemes, and Government programs for the unorganized sector.
About Mercer:
Chief Executive Officer(CEO) – Pat Tomlinson
Headquarters – New York, the United States of America (USA)
Established – 1945
