Governance

Fewer than one in four major employers say their scheme has a specific ‘decumulation strategy' in place to help retirees get the best annuity, research finds.

The Pensions Regulator's (TPR) defined contribution (DC) code of conduct has created a "paradigm shift" in trustee knowledge requirements and leaves them far more open to criticism, industry experts claim.

More than half of trustees (56%) believe current governance structures prevent them from quickly taking advantage of market conditions to improve their funding level, according to research.

Just three out of ten contributors said trustees always performed the necessary due diligence before signing anything off, although two thirds said this was the case always or most of the time.

Pensions Buzz respondents have thrown their respective bulk behind calls for an extra layer of governance in contract-based schemes.

A requirement for all contract-based schemes to have employer-level governance committees would need Financial Conduct Authority (FCA) action on insurer transparency, Pan Group founder Andrew Cheeseman says.

The government has committed to exploring ways of improving governance in contract-based defined contribution (DC) schemes, including forming multi-scheme member committees.

Contract-based defined contribution (DC) providers are likely to be given a fiduciary duty similar to that of trustees, Punter Southall principal Alan Morahan says.

The European Securities and Markets Authority (ESMA) has published guidelines on remuneration for companies and regulators in the investment sector.

Data from The Pensions Regulator (TPR) shows 97% of surveyed DC schemes provide support to members wishing to exercise their open market option (OMO).