Ford Motor embarked on an ambitious program in 2007 to reduce the risks posed by its defined-benefit pension plan by shifting assets out of stocks and into bonds.

In more than 50 years of operating the plan, Ford had focused on maximizing returns and invested mostly in equities.

"Our history had been to manage the assets almost independently of the liabilities," says Kathleen Gallagher, Ford's director of asset management. "The events of recent years really required us to reconsider. The combination of funding regulations and the challenges facing the company made us much more intolerant of swings in returns and much more sensitive to how the assets were going to behave relative to the liabilities."

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