Regulator to set out clear expectations for trustee knowledge and governance

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20 Feb 2020

What you need to know

The Pensions Regulator (Regulator) has responded to its consultation on the future of trusteeship and governance. It had set out proposals in three areas: trustee knowledge and understanding (TKU), scheme governance structures and driving defined contribution (DC) scheme consolidation.
In response, the Regulator has said it will take forward actions in each of these areas. In particular the Regulator will:

Provide updated expectations on TKU, consulting on changes in the first half of 2021;
Set up an industry working group on improving board diversity, and carry out a further review of sole trusteeship while supporting the development of an industry code on sole trusteeship; and
Not mandate but rather monitor DC consolidation activity and work with industry and Government to overcome barriers to consolidation.

Ensure all trustees of your scheme are aware of upcoming changes and the Regulator’s expectations.
Review the operation of your trustee board and approach to training in advance of the new TKU requirements.
If considering sole trusteeship for your scheme, ensure you look at managing conflicts of interest and member engagement and look out for the upcoming APPT industry code.
Consider joining the industry working group on board diversity before 29 February 2020. Apply by emailing:[email protected].

For further information, please get in touch with Robert Wallace or Sophia Rayworth or speak to your usual XPS contact.