Key facts
- Trustees' fiduciary duties require them to act in the best interests of scheme beneficiaries.
- The UK trust-based pension system manages around £1.5 trillion of assets for over 40 million members.
- The government is proposing increased knowledge and understanding requirements for trustees.
An industry leader has criticized pension providers for prioritizing low fees, arguing that this focus restricts pension schemes' ability to invest in growth assets. The leader stated that this fixation "ties the hands of schemes" and hinders their investment potential.
Meanwhile, the UK government is undertaking a review of trustee governance and skills within the pensions sector. A consultation document highlights the evolving pensions landscape, with a shift from Defined Benefit (DB) to Defined Contribution (DC) schemes and the emergence of larger schemes. The government aims to ensure trustees possess the necessary skills and knowledge to act in members' best interests.
Proposals include increasing knowledge and understanding requirements for trustees, with centrally set standards and accreditation for professionals, as well as measures to improve the diversity of trust boards. The trust-based pension system in the UK oversees approximately £1.5 trillion in assets for over 40 million members, with trustees holding fiduciary duties to act in beneficiaries' best interests.