Fiduciary management is certainly popular and, with the CMA review, particularly topical. The thing is, pension trustees really need to be sure they know what they’re buying. Well, actually, they need to be sure they know what they want and that what they’re buying is the same as what they want!
An example…
I was appointed professional trustee to a new client and, unusually, attended my first pension trustee meeting for them that same day. The trustees had taken investment advice and were about to act on this advice and implement a revised investment strategy.
During the discussion on this agenda item, it became clear the advice the pension trustees had received (and were about to implement) didn’t match what they were actually looking for. Alarm bells were ringing. As a professional trustee I needed to make sure the board progressed on the right foot, but it was my first meeting and I also needed to make sure I developed the right working relationships for the future. What’s a lady to do?
Although it was my first meeting, I was able to support my co-trustees in re-examining the decision by explaining the difference between what it is they understood they were getting (full fiduciary management) and what they would be getting if they went ahead as planned (an investment platform providing a partial delegation solution). The decision to implement wasn’t taken that day and I was able to help the pension trustee board select a new investment adviser and progress to implement an appropriate solution shortly thereafter.
Fiduciary management is complex. It has several different names, forms and each fiduciary manager has particular strengths and weaknesses. I’m fortunate being part of a professional trustee firm where we get training and share expertise and experience across a wide range of clients. It means I can be confident in my knowledge but can see just how confusing it can be for others.
My advice for other pension trustees? It isn’t worth risking making a decision that is difficult and expensive to undo - expert help is critical and, as the CMA tells, us, that help has to be independent.
‘ PSGS & 20-20 Trustees merge to form Vidett ’
Punter Southall Governance Services (PSGS) & 20-20 Trustees (20-20) have today announced they...
‘ Don’t be surprised that your gilt funds are being treated like an emerging market ’
You may have seen or heard about the article in the Financial Times about how Insight...
Vidett is a trading name of Vidett Governance Services Limited, Vidett Trust Corporation Limited & Vidett HRT Limited
Registered in England and Wales numbers 3021321, 10842337 & 745598
Registered office: 3rd Floor Forbury Works, 37-43 Blagrave Street, Reading, RG1 1PZ
