Republic of the Philippines

COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY

Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

GRADUATE SCHOOL
Critical Article Analysis

DEGREE : Doctor of Education

MAJOR : Educational Management

Title: “Managing Pension Risks in Public Sector: A Study of Lagos State

Government Public Service”
Author: Ahmed Ishola Kotun, Abayomi Olarewaju Adeoye, Waidi Adeniyi
Akingbade Journal of Financial Risk Management Vol.12 No.3, September
28, 2023

1. Introduction: The study "Managing Pension Risks in Public Sector: A

Study of Lagos State Government Public Service," authored by Ahmed
Ishola Kotun, Abayomi Olarewaju Adeoye, and Waidi Adeniyi Akingbade,
published in the Journal of Financial Risk Management, Volume 12,
Number 3, on September 28, 2023, delves into the critical issue of
pension risk management within the context of the Lagos State
Government Public Service. This research investigates the challenges,
strategies, and best practices employed by the public sector in Lagos
State to mitigate the financial and operational risks associated with
pension obligations, shedding light on the broader implications for public
sector pension systems and their sustainability. The study offers valuable
insights into how public entities can navigate and address the complex
landscape of pension risks, ensuring the financial well-being of their
retired workforce and the long-term stability of their pension schemes.

2. Summary: In their comprehensive study titled "Managing Pension

Risks in Public Sector: A Study of Lagos State Government Public
Service," Ahmed Ishola Kotun, Abayomi Olarewaju Adeoye, and Waidi
Adeniyi Akingbade investigate the intricate landscape of pension risk
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

management in the public sector, with a focus on the Lagos State

Government Public Service. The research provides a meticulous analysis
of the challenges inherent in managing pension obligations and offers a
detailed examination of the strategies and best practices adopted by the
public sector in Lagos State to mitigate these risks. Through an in-depth
exploration of the pension system in Lagos State, the study not only
highlights the specific challenges faced by this region but also contributes
valuable insights that are applicable to public sector pension systems
more broadly. By addressing the financial and operational risks associated
with pension schemes, the research underscores the significance of
prudent risk management practices to ensure the financial security of
retired employees and the overall sustainability of public sector pension
programs.

3. Research Question and Hypotheses: The research in "Managing

Pension Risks in Public Sector: A Study of Lagos State Government Public
Service" by Ahmed Ishola Kotun, Abayomi Olarewaju Adeoye, and Waidi
Adeniyi Akingbade aims to address several key research questions and
hypotheses. These include inquiries into the nature and extent of pension-
related risks within the Lagos State Government Public Service, the
effectiveness of existing risk management strategies in mitigating these
risks, and the impact of demographic, economic, and regulatory factors
on the sustainability of the pension system. The study also explores
hypotheses concerning the relationship between risk management
practices and pension fund performance, as well as the influence of
pension risk management on the overall fiscal health and stability of the
Lagos State government. Through this investigation, the researchers seek
to provide a comprehensive understanding of the challenges and
opportunities associated with pension risk management in the public
sector, with a specific focus on Lagos State, offering valuable insights for
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

policymakers, pension fund managers, and stakeholders in similar

contexts.

4. Methodology: In their study, "Managing Pension Risks in Public

Sector: A Study of Lagos State Government Public Service," Ahmed Ishola
Kotun, Abayomi Olarewaju Adeoye, and Waidi Adeniyi Akingbade employ
a rigorous and multi-faceted methodology. The researchers begin by
conducting an extensive review of existing literature on pension risk
management in the public sector, thereby establishing the theoretical
foundation for their study. Subsequently, they collect primary data
through surveys and interviews with key stakeholders, including pension
fund administrators, government officials, and retired public servants
within Lagos State. The data collected is then analyzed using both
quantitative and qualitative techniques to assess the current state of
pension risk management and its impact on the Lagos State Government
Public Service. Additionally, statistical tools and regression analyses are
employed to test the formulated hypotheses and ascertain the
relationships between various variables. This comprehensive approach
ensures a holistic understanding of pension risk management in the public
sector and offers valuable insights for policymakers and practitioners
aiming to enhance pension sustainability and financial security within the
context of Lagos State and beyond.

5. Literature Review: The literature review in "Managing Pension Risks

in Public Sector: A Study of Lagos State Government Public Service" by
Ahmed Ishola Kotun, Abayomi Olarewaju Adeoye, and Waidi Adeniyi
Akingbade provides a comprehensive exploration of the existing body of
knowledge on pension risk management in the public sector. It delves
into the global context of public sector pension systems, highlighting the
increasing challenges posed by an aging workforce, changing
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

demographics, and volatile financial markets. The review emphasizes the

critical role of prudent risk management strategies in safeguarding
pension fund sustainability, and it examines various risk factors such as
investment, longevity, and regulatory risks that affect pension schemes.
Furthermore, it discusses best practices and strategies employed in
different regions to address these risks, offering insights into the diverse
approaches taken by governments and pension fund administrators. The
review serves as a solid foundation for the subsequent empirical analysis,
enabling the researchers to identify gaps in the literature and inform their
investigation into pension risk management within the Lagos State
Government Public Service.

6. Results: The results of "Managing Pension Risks in Public Sector: A

Study of Lagos State Government Public Service" by Ahmed Ishola Kotun,
Abayomi Olarewaju Adeoye, and Waidi Adeniyi Akingbade offer significant
insights into the pension risk landscape within the Lagos State
Government Public Service. The study reveals that pension risk
management in this context faces multifaceted challenges, particularly
stemming from investment risk, demographic factors, and regulatory
issues. The analysis indicates that the effectiveness of current risk
management strategies varies, with some aspects of risk, such as
investment risk, being better managed than others. Additionally, the
research highlights the positive correlation between effective risk
management practices and pension fund performance, underlining the
importance of proactive risk mitigation measures. The findings also
underscore the impact of pension risk management on the fiscal health
and stability of the Lagos State government, emphasizing the need for
sustainable pension systems to ensure the long-term financial well-being
of retirees and the overall stability of the public service.
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

7. Discussion and Conclusion:

n the discussion and conclusion section of "Managing Pension Risks in
Public Sector: A Study of Lagos State Government Public Service" by
Ahmed Ishola Kotun, Abayomi Olarewaju Adeoye, and Waidi Adeniyi
Akingbade, the research findings underscore the critical importance of
robust pension risk management strategies within the public sector. The
study reveals that the Lagos State Government Public Service faces
significant challenges in effectively mitigating pension risks, particularly in
terms of demographic factors and regulatory compliance. However, it also
highlights areas where risk management practices have been more
successful, such as in addressing investment risk. The positive
relationship between effective risk management and pension fund
performance suggests that adopting proactive risk mitigation measures
can enhance the financial security of retirees. Furthermore, the study
emphasizes the far-reaching impact of pension risk management on the
fiscal health and overall stability of the Lagos State government. The
authors conclude that addressing these challenges and implementing
sound risk management practices is imperative for ensuring the long-term
sustainability of public sector pension systems and safeguarding the
financial well-being of retired employees in Lagos State and, by
extension, similar regions.

8. Contribution to Educational/Rural Development Financial

Management:
The study "Managing Pension Risks in Public Sector: A Study of Lagos
State Government Public Service" by Ahmed Ishola Kotun, Abayomi
Olarewaju Adeoye, and Waidi Adeniyi Akingbade makes a noteworthy
contribution to the field of educational and rural development financial
management. By examining the intricacies of pension risk management
within the public sector, this research provides valuable insights that have
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

direct relevance to the fiscal sustainability of educational and rural

development programs. The study underscores the significance of
effective risk management in maintaining the financial stability of
government entities, which in turn impacts their ability to allocate
resources to education and rural development initiatives. The findings
highlight the need for prudent financial planning and risk mitigation
measures to ensure that resources are available for these critical sectors,
ultimately contributing to the enhancement of educational and rural
development outcomes in regions with similar public sector pension
systems.
9. Strengths:
The strengths of "Managing Pension Risks in Public Sector: A Study of
Lagos State Government Public Service" lie in its comprehensive approach
to examining pension risk management in the public sector, particularly
within the context of Lagos State. The study's thorough methodology,
combining a detailed literature review, primary data collection through
surveys and interviews, and quantitative analysis, ensures a robust and
well-rounded investigation. The research also contributes to the existing
body of knowledge by shedding light on the unique challenges faced by
the Lagos State Government Public Service, offering insights that can be
applied to similar regions and public sector pension systems worldwide.
Additionally, the study's emphasis on the correlation between effective
risk management and pension fund performance underscores its practical
relevance for policymakers and stakeholders aiming to enhance the
financial security of retirees and the overall stability of public sector
pension schemes. Overall, its methodological rigor, contextual relevance,
and practical implications are among the key strengths of this research.
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

10. Weaknesses:
While "Managing Pension Risks in Public Sector: A Study of Lagos State
Government Public Service" offers valuable insights, it does exhibit some
weaknesses. One notable limitation is the potential for the research
findings to be context-specific to Lagos State, which may not fully capture
the diversity of pension systems and challenges faced in other regions.
Additionally, the study primarily relies on surveys and interviews for data
collection, which could introduce a degree of subjectivity and response
bias. Furthermore, the analysis of the impact of pension risk management
on the fiscal health of the Lagos State government, while informative,
may not account for all the intricacies of broader economic and political
factors that can influence government finances. Lastly, the research does
not provide an extensive discussion of potential policy implications or
specific recommendations for addressing the identified pension risks,
which could limit its practical utility for policymakers and practitioners
seeking concrete guidance on improving pension systems. These
weaknesses should be considered when interpreting the study's results
and applying them in different contexts.
11. Overall Assessment:
"Managing Pension Risks in Public Sector: A Study of Lagos State
Government Public Service" by Ahmed Ishola Kotun, Abayomi Olarewaju
Adeoye, and Waidi Adeniyi Akingbade is a commendable research effort
that provides valuable insights into the complex realm of pension risk
management in the public sector, specifically within the unique context of
Lagos State. The study's strengths lie in its comprehensive methodology,
detailed literature review, and the relevance of its findings to similar
regions facing pension risk challenges. By emphasizing the correlation
between effective risk management practices and pension fund
performance, the research highlights the practical importance of proactive
risk mitigation measures. However, some limitations, such as context-
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

specific findings and the absence of specific policy recommendations,

should be acknowledged. Overall, this study is a significant contribution to
the field of public sector pension risk management and offers a foundation
for further research and practical application in regions with similar public
sector pension systems.

12. Conclusion:
In conclusion, "Managing Pension Risks in Public Sector: A Study of Lagos
State Government Public Service" presents a comprehensive examination
of the challenges and strategies surrounding pension risk management in
the Lagos State public sector. The study underscores the critical role of
effective risk management in ensuring the financial stability of pension
systems, which, in turn, impacts the fiscal health of the Lagos State
government and its ability to allocate resources to various critical sectors.
The findings emphasize the importance of addressing pension risks to
safeguard the financial security of retirees and the overall sustainability of
public sector pension schemes. While this research highlights several
areas of concern, it also suggests opportunities for improving risk
management practices and ensuring the long-term viability of the public
sector pension system in Lagos State. As a whole, this study contributes
to the broader discourse on pension risk management, offering valuable
insights that can inform policy decisions and financial strategies not only
in Lagos State but also in other regions with similar pension systems.
 Republic of the Philippines
COTABATO FOUNDATION COLLEGE OF SCIENCE AND TECHNOLOGY
Barangay Doroluman, Arakan, Cotabato
Contact No. +639685331496
Email Address: admin@cfcst.edu.ph Website: www.cfcst.edu.ph

Submitted By: Johny Rey G. Galope, EdD2

-------------------------------------------------------
Course and Year

Submitted To: Dr. Harris M. Sinolinding

Graduate School Professor
Cotabato Foundation College
of Science and Technology

Date of Submission:_ November 5, 2023