Why should a employer offer a pension plan?

I don't understand why an employer from a business or company want to voluntarily fund a pension plan for its employees. From a financial standpoint, it would cost the company quite a bit without returning anything substantial. Anyone care to shed some light on this?

Defined benefit pension plans are no longer in vogue. Once the employer promises a certain level of pension benefits, the employer retains the risk if the pension plan is not sufficiently funded, for example if investment returns are worse than expected.

Nowadays it is more common for an employer to offer a defined contribution plan: the employer promises to make a certain contribution, but it is no longer the employer's risk if the plan is not sufficiently funded for a decent pension.

To compete with good companies who want to attract talented employees.

They want good employees to stay, the bad ones they can fire.

The employer is looking after the welfare of the employee in question. Of course the aim is also to keep good employees as well.

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