Trustees are more effective as a team if they work together sharing experiences and knowledge.
Relying on a perceived star player is a fraught with risk. Corporate history is littered with examples of such companies. Sir Philip Green and BHS spring immediately to mind.
What a Pension Trusteeship looks like in the 21st Century
There has been a seemingly overwhelming flood of regulation and guidance for pension trustees. Added to this, The Pensions Regulator aka ‘our friends in Brighton’ has been leading a debate about what Pension Trusteeship looks like in the 21st Century. We are expecting more from them about this later in 2017.
One of the themes that is good to see is that just as diversity in the company boardroom is now seen as best practice, the same is equally true of trustee boards.
What does diversity in a trustee board look like?
It’s as important to get the right skill set as it is to ensure a good gender/ethnic mix.
In the same way that a company board usually have a mix of HR, IT, Finance and Operations specialists, Trustee Boards should look to have a similar breadth of skills on their board.
Types of trustee
For the role of the non-executive director, the professional trustee is a great choice. They are independent, will have seen other schemes face similar issues be able to share that learning and experience in order to get the best possible result for the Board and pension scheme.
Member nominated trustees
Member nominated trustees are every bit as important as company nominated trustees. They usually have a greater understanding of the culture of the company and can judge the impact of specific change on different groups of members. This makes them particularly helpful in developing member communications.
Company nominated trustee
A company nominated trustee is usually a director of that company or someone with authority in the company – they will likely have knowledge of the vision and strategy for the company – important to ensure the needs of the pension scheme are aligned to the needs of the company.
It’s important that the different knowledge and experience of the trustees is brought together for the benefit of the trustee board and, more importantly the pension scheme (without adversely impacting on the success of the business).
With the constant changes introduced by the Pensions Regulator, trustees need to continually develop their skills and expertise in order to meet all that is expected of them.
The team that learns together is a more effective unit than one where trustees go off and learn individually.
Whilst the Trustee Toolkit is a useful start in trustee knowledge and understanding, it’s applying this learning to the specifics of the Scheme which is the real trick.
This is where the scheme adviser/independent trustee has an important role to play. They can ensure that training on relevant topics is given at the appropriate time.
In summary – A trustee board should think like an Olympian
That this is not a one person show seems to us to be a statement of the obvious. Just as we have seen in recent sports events, and will no doubt see at the forthcoming IAAF World Championships in London, the athletes have support staff all around them, pulling in the same direction, in order to achieve the highest standards.
To us as professional trustees, we could not think of a better model for trustee boards to be aspiring to.
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If this sounds like the way you believe that trustee boards should be working why not contact us at firstname.lastname@example.org for a more in depth discussion.
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