South Africa ranks 51st out of 55 retirement income systems in the 2026 Marsh CFA Institute Global Pension Index, published on 20 October 2026. Its overall score slipped to 50.4 from 51.0 in 2025, it kept a C grade, and it sits well below the global average of 65.3, according to the index report and BusinessTech.
What it means for your business
The index does not rate your company’s pension fund, but it describes the system your employees’ retirement savings sit inside. Its weakest score for South Africa is on adequacy, whether retirement benefits provide enough income, and BusinessTech’s summary of the report says many people remain outside formal employment and employer-sponsored retirement arrangements. For an employer, that is a prompt to look at who in your workforce is actually saving, how much, and whether the money stays invested when people change jobs. Those are our suggestions, not findings of the index.
The scores
The index is the 18th edition. It is published by Marsh with the CFA Institute and supported by the Monash Centre for Financial Studies, and earlier editions appeared under the Mercer name. According to the Marsh press release, it compares 55 systems covering 66% of the world’s population. The overall score is a weighted average of three sub-indices, and the full report gives the weights as 40% for adequacy, 35% for sustainability and 25% for integrity.
South Africa’s results, from a copy of the full report and confirmed by BusinessTech:
- Overall: 50.4, down from 51.0, grade C.
- Adequacy: 37.3, down from 38.0, grade D.
- Sustainability: 47.8, down from 48.2, grade D.
- Integrity: 75.0, down from 75.7, grade B+. This is the country’s strongest area.
The report defines a C as a score of 50 to 59 and describes it as a system with some good features but also major risks or shortcomings. South Africa’s 50.4 is 0.4 points above the bottom of that band. The report also cautions that when overall scores differ by less than two or three points, it is not safe to say one system is better than another, while a gap of five or more points can fairly be read as a real difference.
How it compares
All four African systems in the index are graded C. Namibia scored 57.5, Botswana 57.0 and Kenya, which joined the index this year, 53.1, all ahead of South Africa’s 50.4. The report tables show that Botswana and Namibia also fell from their 2025 scores of 59.8 and 59.1. The Netherlands topped the ranking with 85.8, followed by Denmark and Iceland, and Singapore, Israel and Australia also earned A grades, according to BusinessTech. Australia received an A for the first time, the Marsh release says.
The report attributes South Africa’s decline to relatively small reductions across all three measures, which must be read alongside updated data and a methodology change. The adequacy measure of net replacement rates, which compares retirement income with earnings, now gives 75% weight to income at retirement and 25% to income at age 80, where before it looked only at retirement. The report says this change reduced the average adequacy score across all systems by 0.2.
Strengths and weaknesses the report names
As summarised by BusinessTech, the report credits South Africa with the size of its pension assets relative to GDP and an established regulatory and governance framework. It notes that the country’s two-pot retirement system is recognised as a reform intended to improve preservation and harmonise retirement benefits. It also points out that the means-tested grant for older persons provides a public safety net, but that South Africa lacks a broad contributory public pension system to complement private savings.
The priorities the index identifies for South Africa are broader occupational pension coverage, minimum mandatory retirement contributions, stronger support for the poorest older people, higher household savings and greater workforce participation among older people.
What retirement industry voices say
Belinda Sullivan, head of corporate consulting strategy at Alexforbes, said the focus should be on outcomes rather than rank. BusinessTech quotes her as saying: “The priority is not simply to improve South Africa’s ranking; it is to help more people build savings and turn those savings into an income that lasts.” She added that broader coverage, consistent contributions and better support for retirement decisions are essential. That is her view as reported by BusinessTech, and we have not seen the full remarks.
What to do
- Ask your retirement fund administrator or benefit consultant what share of your staff contribute, and at what level, and whether you offer any retirement cover to contractors or part-time workers.
- Review how your fund communicates with members about preservation and two-pot withdrawals, since the index links better support for retirement decisions to better outcomes.
- Treat the ranking as a prompt to review, not as a measure of your own fund. The index scores national systems, not individual funds.
For related reading, see our report that only 10% of Alexander Forbes members are on track for a 75% pension replacement, the EPPF’s call for broader ownership models in retirement funds, and Treasury’s proposal for a single administrator of R88 billion in unclaimed assets.
