The Association of Member-Nominated Trustees co-chair David Weeks remembers some of the organisation’s highs and lows during a tumultuous first decade
The Association of Member Nominated Trustees (AMNT) celebrated its tenth anniversary in September 2020 having been formally established in September 2010. But the seeds for its formation were planted in dramatic fashion in 1991 when the lifeless body of Robert Maxwell, former war hero, MP and head of Mirror Group Newspapers, was dragged from the Atlantic Ocean.
It soon became apparent that Maxwell was a criminal who had been able to bypass governance procedures to loot just under half a billion pounds from Mirror Group pension funds. A media storm erupted and the government was forced to respond. Something had to be done.
As part of the solution parliament moved to ensure that pension scheme members became better represented in the governance of their schemes in order to protect them from unscrupulous and overbearing sponsors. One-third of trustees were to be nominated by the scheme members themselves, giving their representatives substantial oversight and power.
Over time these member-nominated trustees sought a support organisation to assist with their development and to represent their views. So, in 2010, the AMNT was born as a not for profit organisation.
It is important to note that he AMNT was, and remains, the only pensions trade association that represents primarily individual pension scheme members and their representatives. Membership now stands at around 800 individual trustees, representing pension schemes with assets under management of over £900bn. That is around one third of the total UK occupational pensions sector.
We have provided support and encouragement to members through ten years of major changes for the pensions industry. Further scandals followed the Maxwell debacle: most notably BHS and Carillion. In 2015 came ‘pensions freedom', then the Pension Schemes Act 2017 and recently the Pension Schemes Bill 2020.
And it goes on! There are now moves to consolidate and amalgamate in the industry: both providers and pension schemes. This includes the Pensions Regulator's concerns about a long tail of badly run and often smaller schemes; Covid-19 has had an impact on investment, governance and mortality rates; and regulators and provider interests make moves to turn trusteeship into an all accredited activity. There is still much for us to do to assist our members going forwards.
Our lobbying activity over the past decade has led to a number of successful outcomes. We fended off recent moves to turn trusteeship into a narrowly defined "professional" activity, promoting instead the formula that democracy in pension schemes plus well-trained generalist trustees equals good member outcomes.
Additionally, the AMNT played a major role in forcing ESG up the agenda from a niche activity to one that we promote actively to our scheme members, especially the younger ones. Our Red Line Voting initiative has become an admired model in promoting ESG and the rights of trustees as asset owners. And, we pressed the case for greater transparency in costs and charges.
I am pleased to say that civil servants in the Department for Work and Pensions have told us that we at AMNT: "punch above our weight".
But we cannot rest on our laurels. AMNT has made great strides in the last decade but we still have much to do. Our ongoing activities will cover all five themes that members tell us are important to them - investment; governance; soft skills in trusteeship and board procedures; administration; and communications with members. We aim to spread good practice in all five. In partnership with our sponsors we are running a series of 12 webinars over the remainder of 2020 to cover these themes. Details of these, and our other activities, can be found at our web site: www.amnt.org.
Our members are experienced, competent and thoughtful, albeit not very diverse. In 2017 we conducted a survey amongst the membership.
They were asked about the biggest risks that their scheme faced. In descending order, the top answers came through as: volatility/ under performance in investment; employer covenant; regulatory changes; and inappropriate funding strategy.
We also asked "How can trustee boards attract new MNTs?". In descending order, the answers were: payment; training and knowledge; emphasise the importance of pensions. Finally, they were asked "Has your investment adviser ever tabled issues of ESG?" Six out of ten said yes.
We are currently repeating this research and look forward to seeing how members views have changed on these major issues during the intervening three years. We will use the results to guide our thinking and activity going forward.
Finally, I would like to mention our sponsors, who have remained loyal to us despite the financial pressures that they have faced from Covid-19. On behalf of the association, I thank them deeply - we rely on them for our income as membership of the AMNT is free to member nominated trustees, most of who are unpaid.
In the past decade member nominated trustees have become a recognised force on the pensions landscape. In its first ten years the AMNT has met its mandate to promote this state of affairs. Our aim throughout has been to enhance the wellbeing of pension scheme members. We are ready for the new challenges that will surely emerge during the years to come.
David Weeks is co-chair of the Association of Member-Nominated Trustees