A growing number of organisational pension schemes are employing professional/ independent trustees.
The life of a lay trustee is not an easy one, particularly if he/she is a trustee of a defined benefits scheme. To start with, all trustees are required to have sufficient knowledge and understanding to enable them to challenge advice they receive from their professional advisers, when appropriate. This means that they must have a working knowledge of pension law, investment markets, actuarial practices and, possibly, employment law.
Add to this the discussions which take place at the time of triennial actuarial valuations of defined benefits schemes and possible conflicts of interest (employer versus trustee), and it's not hard to see why being a lay trustee can be a daunting task.
Perhaps this is why a growing number* of schemes are appointing independent or professional trustees to work alongside, and with, the lay board of trustees.
No matter the size of the scheme, trustees, and particularly those of defined benefits schemes, will have issues to address and manage. Appointing an independent/ professional trustee would, in many cases, ease the burden and make the life of the lay trustee a lot easier.
How We Can Help
Smith & Williamson acts as professional trustee to a variety of trust arrangements. We act as professional trustee to over 200 small self-administered pension schemes and provide trusteeship and administration services for established employee benefit trusts and share save schemes. Through our private banking service we can provide full trustee bank account services.
Footnote
*The Mercer Trustee Board Structure, Performance and Remuneration survey of 2008 questioned the trustees of 158 organisational pension schemes of various sizes. 44% reported that an independent/professional trustee had been appointed to the board. The 2007 figure was 35%.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
