This webinar presentation below looks at the importance of addressing Strategic Investment Objectives in the wake of Covid-19 and in line with the CMA Order which required DB trustees from 10th December 2019 to set clear objectives for their investment advisers, whether an investment consultant or fiduciary manager. We have split the recording into two parts i.e. the introduction and presentation, then the Q & A.
Introduction and Presentation
Covid-19 has put funding and covenant under pressure although it is something trustees can do little to influence. Therefore it becomes even more important to get the most from your investments and having clear and effective strategic investment objectives is an essential element in achieving this.
In addition, The Pensions Regulator's guidance says trustees should be reviewing their current investment and governance arrangements to ensure they remain appropriate to enable decisions to be made quickly.
TPR’s guidance recommends that schemes:
• State objectives that take account of the scope of investment services offered
• Use balanced scorecards to evaluate investment advice
• Understand that it is against the spirit of the order for investment consultants or fiduciary managers to set and measure their own objectives
What should these objectives look like, how will they be measured, how often and what happens next?
What You’ll Learn
• Regulatory background to the order to set and assess clear strategic investment objectives
• How this will work, for example the balanced scorecard, measurement and assessment process and the benefits for trustee boards
• How to ensure that all objectives are Relevant, Achievable, and Measurable
Suitable for - Defined Benefit (DB) pension scheme trustees, chairs, sponsors and other stakeholders
Martin brings 40 years of experience to the defined benefit (DB) investment governance specialists, having worked in previous pensions roles for blue-chip multinational companies. These include as global benefits director at Tetra Pak, head of pensions and benefits at Royal Bank of Scotland, and vice-president of pensions at DHL.
He previously chaired the Pensions and Lifetime Savings Association’s benefits and investment councils – when the trade body was known as the National Association of Pension Funds – and the UK Investment Performance Committee, the consultative body for the Global Investment Performance Standard.
He is currently also managing director at Protrustee, and a trustee for the Church of Scotland Pension Schemes, a Unity Trust Bank scheme, and the Really Useful Theatres Pension Scheme. He also serves as chairman of the East Sussex Pension Fund board, and vice-chairman of the Scottish Teachers’ Pension Scheme board.
"The CMA Order for trustees to set Strategic Investment Objectives by 10th December 2019 for their investment advisers is a “game changer”.
The setting of clear objectives will result in trustee boards then wanting to measure success and judge value for money. At a time when covenant and funding are under severe pressure investments become more central and investment governance is something DB trustees/sponsors can improve. Research shows good governance can add 1-2% pa to returns.
Given the Covid-19 disruption there will be real benefits for Trustees starting this sooner than later. After all ‘What gets measured gets done’.”
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This article was published in Pensions Expert | March 18, 2020
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