Report of the Chairman of the Board of Directors and of the Director

compenswiss finished 2023 with a positive investment result of 4.98%. After a result of −12.85% the previous year, this represents a pleasing turnaround. In an environment increasingly marked by geopolitical tensions and confrontations, the financial markets have been impacted by several factors such as military security and the challenges of food, energy, and information technology.

Market situation

With the effects of the pandemic subsiding, the global economy is gradually regaining its balance.

Economic, monetary and fiscal upheavals ultimately produced the highest level of inflation seen for decades. After most central banks had been forced to aggressively raise interest rates since 2022 to contain the rampant inflation, investors noticed that the tightening of monetary policy was beginning to bear fruit in 2023.

The higher interest rates increased borrowing costs for consumers and companies, which led to an economic slowdown and a reduction in profitability. When the dreaded recession did not materialise, inflation slowed down greatly, particularly in the manufacturing sector.

A positive allocation result

Overall, insurance-related income exceeded charges by CHF 1 550 million.

Contributions of CHF 45 635 million represent 71.9% of total income.

In 2023, the net result from investments of CHF 1 758 million contributed to the insurance profits and the overall positive result. This resulted in an increase in total equity. The positive investment result reflects the recovery in financial markets towards the end of the year.

Old -Age and Survivors' Insurance

Old-age and survivors' insurance (OASI) is the main pillar of the Swiss social security system. The old-age pension is intended to enable the insured person to retire from working life at the planned age and, together with the professional pension scheme, to guarantee material security during retirement. The survivors' pension is intended to prevent the death of a parent or spouse from causing undue financial hardship.

Invalidity insurance

As is the case with Old-age and survivors' insurance (AVS), disability insurance (AI) is a compulsory insurance. It aims to guarantee the means of subsistence for insured persons who have become disabled, either through benefits in kind (rehabilitation measures) or cash benefits (pensions or allowances).

LEC

This insurance compensates for part of the loss of earnings suffered by people who perform military service, civilian service or serve in civil defence. Since 2005, it has also compensated for loss of income due to maternity (maternity allowance) and, since 2021, for loss of income due to paternity leave. It is compulsory and all persons subject to OASI/InvI contribute to it.