“The trustee training course lecturers' explanations and willingness to answer questions were most valuable - even silly ones - although I have learnt there are no 'silly questions' that trustees should ask.”
“We now have a very collaborative approach between trustees and employer.”
“I found the trustee training really beneficial, highly recommended. I am not a trustee, I represent the employer and I think it will be valuable for me in future, having a better understanding of the trustees' perspective.”
“Excellent and comprehensive training course. I will definitely refer to what I've learned and received. ”
“I learnt more than I expected to at the trustee training course. A good introduction to the trustee role.”
“Very broad, comprehensive trustee training course covering a wide range of topics. Excellent!”
In a recent consultation paper, the Pensions Regulator (tPR) put forward a revised description of a professional trustee, but carved ‘independent trustee’ out from that description. This concerns me.
If the description of a professional trustee is being prescribed, so should that of an independent trustee. I would argue anyone holding themselves out as an independent trustee and charging for their services must come within the definition of professional trustee and be held to higher standards. It is the category of so called independent trustees that potentially needs more regulation.Former employee trustees – are they professionals?
There are many instances where former company executives are appointed pension trustees, are paid for their role and hold themselves out as an ‘independent trustee’. These individuals would argue they are not professional trustees under the Regulator’s proposed description. However, in this situation, the trustee board and pension scheme sponsor usually feel they have appointed a knowledgeable, professional trustee to the board and therefore would not benefit from also appointing a ‘professional’ pension trustee (who would be better placed to help them raise governance standards).
These ‘former employee’ trustees are often believed to be independent by the board and/or sponsor but, in reality, many are not really independent when they still have close relationships with company board members or senior executives. In the eyes of those making the appointment, they are often equivalent to a professional pension trustee.Who should face higher monetary penalties?
I agree with tPR that professional trustees should be held to a higher standard of care and, if they were complicit in any breach leading to a fine, the size of the fine should generally be higher. However, tPR also said: “A trustee who is remunerated (beyond their necessary expenses) may or may not come within our description of a professional trustee”.
I would argue any ‘independent trustee’ who is charging for their trustee services should be held to account for higher standards than lay trustees.
Perhaps a good way to track this is via the pension Scheme Return. tPR currently monitors whether a scheme has a professional trustee on this document. I suggest ‘independent trustee’ is added as another category, along with a question asking if they are remunerated for their role. If the answer to both questions is yes, they should be treated the same as a professional trustee.
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