AMNT says schemes and regulators must do more to support MNTs

Detractors say lay trustees’ performance is simply not good enough. One or two have even questioned whether lay trustees should be considered at all. 

While this debate about quality has regularly surfaced, it is rare for the commentator to ask why standards might be suboptimal. 

The Association of Member Nominated Trustees (AMNT) rejects the notion that MNTs do not offer value to the governance process of their schemes. 

It does, however, recognise that trustees encounter obstacles that prevent them from reaching their full potential, both in training and qualifications and in carrying out their duties. 

Janice Turner, co-chair, AMNT, said: “Member nominated trustees (MNTs) are as important now as they were in 1995 when the government required them to constitute one third of pension scheme trustee boards. 

This is a time of change in pensions, with the rise of DB consolidators, master trusts, the collective defined contribution model and growing interest in the potential of CDC decumulation vehicles

Janice Turner, AMNT

“This is a time of change in pensions, with the rise of DB consolidators, master trusts, the collective defined contribution model and growing interest in the potential of CDC decumulation vehicles.” 

The association has spent the last few months in consultation with its membership to determine how to ensure that all trustees are able to perform at the highest level. 

It discovered that trustees need direct support, but also that employers must enable trustees to be properly trained and have the time to carry out their duties effectively.

The main findings included the need for a statutory right to a minimum number or formula of days away from their day job, and workload reduction of their workload, to enable them to carry out their trustee duties, training and preparation effectively. 

It said that every scheme should be required to send the Pensions Regulator each trustee’s certificate on completion of the toolkit.

It also called on the regulator to update the toolkit as a matter of urgency as it is becoming very out of date. 

Schemes and sponsors should offer MNTs more support to encourage trustee training and pay for recognised examinations, and cover fees for training. 

The AMNT argues every scheme should have at least one accredited trustees on the board they professional or lay and all trustees be encouraged to get accreditation. 

All trustees must act in the members’ best interests, but MNTs have the additional pressure having some skin in the game, when professional advisers and professional trustees do not,” added Turner. 

“Scheme members may feel greater confidence that decisions are being made in the best interests of the members when trustee boards include member nominated trustees.

“It is imperative that the interests of ordinary pension savers are prioritised over the commercial interests of the financial services industry.”