Top Tips For New Trustees

Top tips for new trusteesIn the high-pressure, high stakes world of the pensions industry, scheme management is never an easy job. Pension scheme trustees face administrative and legal pressures, along with an obligation to act with honesty, transparency and complete impartiality in all their dealings with the trust agreement.

Before trustees can assume their roles, they must be conversant in the details of the scheme they are charged with governing – and any relevant legal or administrative demands. While some trustees will have years of financial experience to draw from, many lay-trustees will lack this advantage – fortunately, there are plenty of training schemes available to help individuals become comfortable with the position.

What type of training should new trustees go for?

New trustees and anyone without a financial background should approach the role from a general perspective. Training courses, seminars, conferences and literature are available for a range of educational needs, but an ideal starting point for lay-trustees is The Pension Regulator’s online ‘trustee toolkit’. The toolkit is a free resource and can be browsed by trustees at leisure. The toolkit involves essential information in both theory and practice, along with case studies and tutorials – the kit serves as an excellent supplement to any additional ‘off-line’ training the trustee is undergoing.

While online resources may be useful, combining them with other methods can be particularly effective. Workshops and seminars provide opportunities to meet other trustees in the same position and discuss concerns or problems specific to particular schemes. To get the most out of any training strategy, it’s important that trustees ‘self-asses’: identifying the areas which they’d like to receive guidance, and weaknesses in their own skill-set.

Tips to achieve a sufficient level of trustee knowledge and understanding include:

Regular briefings: these can be broadly-themed or scheme specific, but involve bringing in a professional advisor to consult with trainees in a formal capacity.

Development programme: implementing a long-term plan for the training of trustees – and keeping records of their development as a way to build and consolidate knowledge.

Self-review: scheme trustees should provide their own feedback on their performance and the training they receive in order to tailor future training to their needs.

Communication skills: one of the biggest parts of the trustee role is being able to communicate with every member of the trust agreement – reassuring beneficiaries and advising employers. Communication skills are crucial to the execution of this duty.

Mandatory training: trustee education should be seen as a vital fixture in the appointment process and not just a preferential addition. While training isn’t a compulsory part of a trustee’s background, many of their duties and responsibilities carry legal weight – and can result in fines and penalties if not properly observed. The discipline and knowledge training brings, and its importance in preparing trustees for the ‘real thing’, should not be underestimated.

Active, practical experience is only possible once the trustee takes up his or her position and begins managing their pension scheme. Unexpected problems and challenges are sure to arise throughout the lifetime of a pension, along with eventualities not covered by any training scheme. Maintaining a constant state of training and continuous ‘skill-building’ puts scheme trustees in the best position to handle these unexpected obstacles – and ensures employee retirement savings are in the hands of capable managers with the ability to adapt and overcome problems.

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