Press-Feature #Working at Bosch

Retirement benefits scheme at Bosch

Five questions for Dirk Jargstorff, head of pensions and related benefits, Robert Bosch GmbH

Trix Boehne

Trix Boehne >


How important are retirement benefits schemes for Bosch?

Jargstorff: People should be able to make provisions for their retirement while they are still actively working. This is why Bosch supports its associates with pension provisions that go beyond an employment relationship. With our retirement benefits scheme, we want to make it easier for associates to balance their working and private lives and to give them peace of mind for the future. This includes protecting them against existential risks such as invalidity and death. There is a long tradition of taking care of associates at Bosch: our company founder Robert Bosch launched the first pension plan for associates in 1929. Assuming responsibility and playing an active part in shaping society have always been corporate principles at Bosch.

How is the retirement benefits scheme set up at Bosch in Germany?

Jargstorff: The Bosch pension scheme brings together all the retirement benefits schemes that enable our associates to build up their retirement savings. As an employer, Bosch contributes a fixed percentage of annual income, as well as a sum toward capital formation. Associates can also make their own payments and take advantage of statutory tax and social-security relief schemes. Up to the contribution assessment ceiling, Bosch adds an extra ten percent to these associate payments. All these contributions flow into the Bosch pension scheme. When they retire, associates can claim the capital they have accrued in the Bosch pension scheme as a lump sum, in instalments, as an annuity, or as a combination of any of these three.

What role does the Bosch pension fund play in provision for old age?

Jargstorff: When it was set up in 2002, the Bosch pension fund was the first pension fund in an industrial company in Germany. The pension fund model has special benefits for Bosch associates. In itself, the fund is not driven by profit motive. Its sole aim is to generate reliable company pensions with a high rate of return for associates. The Bosch pension fund allows us to make more attractive investments while keeping the cost for associates low. Yields are passed on to associates one-to-one. Our capital benefit plan means associates can decide for themselves which benefits to take advantage of and how much to contribute themselves. For many years now, we have been regularly praised for our pension fund, as well as receiving awards from specialist and industry circles.

How secure are company pensions at Bosch?

Jargstorff: The sum of all of the contributions paid into the Bosch pension scheme is guaranteed. Moreover, associates’ pension assets are, of course, protected by statutory insolvency protection and supervised by BaFin, the German financial services regulator. Moreover, the Bosch pension fund is an independent institution that is separate from the company. With around three billion euros of fund assets, the Bosch pension fund requires rigid risk management. That is why each associate’s payments are invested speculatively up until the associate’s 55th birthday, after which they are converted into more secure bonds. In order to invest the capital as best we can, we work together with specialist consultants. The fund has always been profitable in the past and generates a yield of around six percent every year.

How can other employees benefit from the Bosch model?

Jargstorff: Future-proof models such as the Bosch pension scheme and, above all, the Bosch pension fund are the key to broad-based retirement benefits in Germany. Our main focus is, of course, on what we as a company can offer our own associates. However, there are many ways in which we contribute our more than 80 years of experience to efforts to improve company pension provision, and thus make a contribution to ensuring financial security for the elderly in Germany. In our contacts with business and politics, we pass on our experience, and in this way help strengthen the statutory framework for company pension provision. In the end, we help improve the level of retirement provision for many employees throughout Germany.

About Bosch

The Bosch Group is a leading global supplier of technology and services. It employs roughly 421,000 associates worldwide (as of December 31, 2022). The company generated sales of 88.2 billion euros in 2022. Its operations are divided into four business sectors: Mobility, Industrial Technology, Consumer Goods, and Energy and Building Technology. As a leading IoT provider, Bosch offers innovative solutions for smart homes, Industry 4.0, and connected mobility. Bosch is pursuing a vision of mobility that is sustainable, safe, and exciting. It uses its expertise in sensor technology, software, and services, as well as its own IoT cloud, to offer its customers connected, cross-domain solutions from a single source. The Bosch Group’s strategic objective is to facilitate connected living with products and solutions that either contain artificial intelligence (AI) or have been developed or manufactured with its help. Bosch improves quality of life worldwide with products and services that are innovative and spark enthusiasm. In short, Bosch creates technology that is “Invented for life.” The Bosch Group comprises Robert Bosch GmbH and its roughly 470 subsidiary and regional companies in over 60 countries. Including sales and service partners, Bosch’s global manufacturing, engineering, and sales network covers nearly every country in the world. The basis for the company’s future growth is its innovative strength. At 136 locations across the globe, Bosch employs some 85,500 associates in research and development, of which nearly 44,000 are software engineers.

The company was set up in Stuttgart in 1886 by Robert Bosch (1861–1942) as “Workshop for Precision Mechanics and Electrical Engineering.” The special ownership structure of Robert Bosch GmbH guarantees the entrepreneurial freedom of the Bosch Group, making it possible for the company to plan over the long term and to undertake significant upfront investments in the safeguarding of its future. Ninety-four percent of the share capital of Robert Bosch GmbH is held by Robert Bosch Stiftung GmbH, a charitable foundation. The remaining shares are held by Robert Bosch GmbH and by a corporation owned by the Bosch family. The majority of voting rights are held by Robert Bosch Industrietreuhand KG, an industrial trust. The entrepreneurial ownership functions are carried out by the trust.

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