HELPING WITH THE CHALLENGES OF RUNNING A DB SCHEME
In many ways this is our core business – helping with the business as usual challenges of governance, funding and investment. The majority of schemes are closed to accrual and as such have been passed from the HR Director’s in tray to that of the FD.
In all these schemes our first priority is to understand what the sponsor wants to achieve for their scheme and then work with them to develop a strategy for achieving it. In many cases this may involve risk or liability management.
However, there are also a range of other challenges that present themselves to a trustee board including a retiring Chair, the need to rebuild and repair relationships within the board or between the trustee and the sponsor.
Many trustee boards also look for assistance from a professional trustee to mentor lay trustees within the board, agree long term objectives, assist with adviser reviews, challenge covenant reviews or to offer specialist expertise in investment strategy and/or the transition to a fiduciary or delegated investment model.
To find out more about our professional trustee services, please explore our Case Studies or CONTACT MARK EVANS.
AT RISK OF ENTRY INTO / ENGAGEMENT WITH PPF / THE PENSIONS REGULATOR
ITS is on the Trustee Advisory Panel of the Pension Protection Fund (“PPF”), the government lifeboat for DB schemes, for both pre and post-insolvency work.
We have successfully taken more than 100 schemes through the PPF Assessment process, whether as a result of insolvency or a managed entry. We are very aware that this can be a distressing time for the members affected and we are used to delivering uncomfortable messages tactfully, but firmly.
A scheme entering assessment does not necessarily mean that the PPF will eventually take responsibility for it. We have managed to secure “better than PPF” outcomes for several schemes up to as much as 138% of PPF levels.
As well as acting as trustee for such cases we are also happy to assist trustee boards in a project management capacity without being formally appointed as a trustee.
To find out more about our pension scheme trustee services, please explore our Case Studies or CONTACT HELEN FRISBY
Many FDs dream of being able to remove pension liabilities from their balance sheets by entering the ultimate safe haven of a buy-out.
This is a large piece of project management of which we have wide experience as well as undertaking the investment decision of a buy-in. These are some of the largest transactions seen in the UK but we have also entered transactions for some of the smallest schemes. Indeed, we have expertise in all forms of de-risking and have excellent relationships with the main insurers and fully understand all the preparatory work that is required for such exercises.
To find out more about our pension scheme trustee services, please explore our Case Studies or CONTACT CHRIS MARTIN
TRANSACTIONAL / RESTRUCTURING
Where a company restructures (through choice or circumstance) or is engaging in merger, acquisition or fund raising and financing activity there can be a significant impact on the employer covenant supporting the pension scheme.
These situations are complex, far from business as usual and are generally periods of very intensive activity. We have extensive experience in negotiating mutually agreeable outcomes, in these areas, for scheme members and sponsors alike.
To find out more about how we can help, please explore our Case Studies or CONTACT CHRIS MARTIN.
SOLE TRUSTEESHIP & SMALL SCHEMES
It is questionable whether many small employers should have had a DB scheme in the first place, but many do with assets under £50m.
They can be a disproportionate drag on the ability of the employer to run their business. Smaller schemes require very pragmatic trusteeship and strong cost management and often, scheme rules will allow an employer to appoint a corporate trustee, such as ITS, to act as a sole trustee.
This is a big cultural step as it severs the link between the trustee board and the employer but with most DB schemes no longer part of the future HR strategy, it makes sense in many cases. We have a specific governance structure around our sole trusteeships with clear delegated authorities. All material decisions are taken by two directors so that sole trusteeship does not equate to one person.
To find out more about how we can help, please explore our Case Studies or CONTACT MARK EVANS
DEFINED CONTRIBUTION & MASTER TRUST
While the emphasis of DC trusteeship differs to DB, it is still a very important role, whose impact is more immediately visible to the membership. Many of our ongoing schemes are hybrid arrangements with DC sections and we see DC as equally important as any DB component.
Our stand alone DC client list includes FTSE 100 and FTSE 250 constituent companies where we have helped deliver market-leading and innovative solutions. We have extensive experience of DC Trust to DC Master Trust transfer and sit on the trustee boards of a number of DC and DB Master Trusts. We also serve on the Independent Governance Committee of a household name provider, overseeing contract based DC arrangements.
To find out more about how we can help, please explore our Case Studies or CONTACT DIANNE DAY.
SHORT TERM APPOINTMENTS & SPECIAL SITUATIONS
A trustee board will sometimes need some assistance to help them through a particular issue, for example, during a period of heightened sensitivity such as a scheme closure, wind up or a difficult valuation exercise where it has become apparent that the sponsor/ trustee relationship has room for improvement.
Occasionally, there may be challenges which are completely unexpected, such as misappropriation of scheme assets and money laundering, which mercifully are rare. A solution to short term issues and special situations is to appoint an independent trustee on an interim basis to help the trustee board work through its current challenges.
We have held a number of such appointments, stepping back on the successful conclusion of the project or often being retained on a longer-term basis.
To find out more about how we can help, please explore our Case Studies or CONTACT HETAL KOTECHA
TRUSTEE GOVERNANCE OFFICE
In our experience, a well-resourced experienced and focused pension executive function can plan and execute Trustee business and strategy efficiently. Delivering value for money.
In practice Trustee Boards and Scheme sponsors are often facing resource constraints be that capacity, capability, cost or a combination.
We can help provide:
- A fully outsourced governance service – becoming the Trustee’s/Sponsor’s “Pensions Office”, a service tailored to the Trustee’s needs,
- A co-sourced solution– working alongside existing support services
- Project Management or address special situations to meet an immediate, perhaps time-limited need.
We use our dedicated Trustee Governance Office team to provide specialist expertise and ensure full cost-effectiveness.
To find out more about how we can help, please explore our Case Studies or CONTACT JOHN LOVELL.