A London based wholesaler with a small closed pension scheme.
We worked with the trustee board to improve their scheme governance to make it robust and fit for purpose. The risk register was out of date and overlong, the Trustees policies were either out of date or missing.
A review of the Trust Deed & Rules highlighted a number of areas where there were clear gaps in the operation of the Scheme. For example, there was no balance of powers document, (defining who has the power to set the employer contribution rate, what the terms of reference for the investment committee are (can they make decisions on behalf of the whole Trustee or can they only make a recommendation).
And there were a number of other gaps in the day to day running of the Scheme.
Quite apart from running the risk of not adhering to the Pension Regulator’s Code of Practice on Internal Controls, it meant the Trustees were spending less than 20% of their time at trustee meetings on the important issues such as employer covenant and funding and the remaining 80% of the time working out what they could and could not do.
We worked through a proportionate and reasonable review of the existing process and controls in place. We identified the gaps and put in place controls which are held in one place so all of the Trustees and their advisers can easily find them.
We also recommended an electronic board meeting pack tool which includes a library of Trustee historic and current documents.
We now spend the vast majority our time at Trustee meetings discussing the scheme journey plan, employer covenant and Scheme funding and less than 20% on the processes required to implement the strategy, making the Trustee Board much more effective.