As one may imagine, "Defined Benefit" plans are more risky for shareholders. If returns on the plan's assets are strong, shareholders make money. In a time like this, however, assets in pension plans are taking a plunge, and shareholders are on the hook to make up the difference. Consider CN Rail (CNI).
In last year's annual report, CNR disclosed that it held $16 billion in assets specifically to pay for its obligations under its "Defined Benefit" pension plan. Since then, the S&P 500 is down almost 50%. CNR also disclosed that it aims to hold 53% of plan assets in equities, suggesting that its pension plan will have dropped by $4 billion in the last year by considering the equity drop alone (i.e. ignoring real-estate and other components of the plan assets).
While some investors may believe the market will rebound by the time these obligations have to be paid, others may have a more dire outlook and believe this to be a permanent loss. Whatever the investor's position may be, it is important that he understands and is aware of any pension obligations a company may have. For CNR, this $4 billion swing represents 20% of the company's current market cap, making it no small point.