The strategic use of pensions by not-for-profit organizations

Thad Daniel Calabrese, Elizabeth A.M. Searing

Research output: Contribution to journalArticlepeer-review


Defined benefit pension plans are an important and unexplored aspect of not-for-profit compensation, covering between 15% and 21% of the estimated national not-for-profit workforce. Here we consider whether pension contributions and actuarial assumptions are mechanisms for achieving not-for-profit financial management objectives such as smoothing consumption, managing reported net earnings, and minimizing pension liabilities. The empirical results indicate a variety of these behaviors. Not-for-profit pension plan sponsors use accumulated net assets to smooth consumption. Further, not-for-profits manage reported profits downwards when they exceed expectations by increasing pension contributions, but both minimize contributions and liberalize actuarial assumptions when they underperform relative to their desired earnings targets.

Original languageEnglish (US)
Pages (from-to)388-414
Number of pages27
JournalJournal of Pension Economics and Finance
Issue number3
StatePublished - Jul 1 2019


  • Earnings management
  • financial management
  • not-for-profits
  • pension contributions

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management


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