We are delighted to have had the opportunity to respond to the Department for Work and Pensions’ consultation regarding trust-based pension scheme trusteeship and governance.
BESTrustees’ response is in the context of our experience as a firm of professional trustees providing pure trusteeship and governance. We are an independent, employee-owned company with no other services or products to cross-sell, unlike some of our competitors. Our commercial drivers do not require us to add other service lines and we don’t need to provide dividends to meet external shareholders’ requirements. In our model, the distinction between impartial trusteeship and independent advice can never compromised.
Our overall view is that the current trustee framework for the governance of the majority of UK pension schemes and the oversight arrangements for professional trustees operate well. We believe that at the heart of the effective governance of all trust-based schemes lies – arguably unsurprisingly – well-informed, independent trusteeship. Preserving the essence of this fundamental discipline must remain a key objective of the next phase of scheme oversight. Trusteeship is not broken. But its independence needs to be protected. And the skills and competence of those who deliver it must be – and must be seen to be – maintained at the high levels members should rightfully expect. We believe that this can be largely achieved within the existing structures and, where change is required, it is through improved accountability rather than substantial regulatory interventions.
To support this, the role of the trustee requires a level of technical knowledge and expertise that enables effective decision-making. Decision-making is all about experience, impartiality, including diverse opinions and receiving and challenging independent professional advice where required. This applies to all trustees, but a professional trustee delivers an additional level of expertise. We advocate accreditation for all professional trustees that is focussed on the skills required for decision-making.
To read BESTrustees’ full, detailed DWP consultation response, please click here.
Latest Thought Leadership
Raising professional trustee standards as TPR plans oversight
An interesting article in Pensions Expert from Andy Boorman, BESTrustees’ director and member of the Society of Pensions Professionals, in which he explains the importance of the regulator’s work on trusteeship and how independence and lack of conflicts can raise standards in professional trustee work. As a profession, we must engage fully with the regulator’s review of oversight in the professional trustee industry and work to define a template for professional trusteeship which serves all stakeholders well. At the heart of everything has to be the overarching principle of independence in our conduct and decision-making in order to secure good …
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Why Independence Matters in Pensions
There are real concerns in the wider industry about the consolidation in the number of independent trustee firms, especially where those firms deliver many different governance and scheme services to a scheme without appropriate checks and balances.
