News / 03 Apr 2019

Standards for Professional Trustees

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A professional trustee is defined by TPR as “any person, whether or not incorporated, who acts as a trustee of the scheme in the course of the business of being a trustee”.

The PTSWG has now published its consultation response, setting out the general standards it expects for professional trustees and the additional standards it expects for professional trustees who chair trustee boards and act as sole trustees.

The response also sets out the accreditation process.

General Standards

As well as meeting the normal requirements of any pension scheme trustee, professional trustees must also have a specialist pensions capability, and be able to demonstrate a range of knowledge and personal skills supported by 25 hours of relevant learning and development each year.

Additional Duties for a Chair

These include a number of technical and soft skills, for example, negotiation and communication skills. The chair should be able to chair the activities of the board with a focus on the strategic priorities and key risks affecting the scheme, maintaining a constructive environment on the board which encourages engagement by all members of that board.

Additional Duties for Sole Trustees

Sole traders and those firms that are not sufficiently resourced to mitigate the additional risks and responsibilities of this role should not act as sole trustees.

Sole trustees should also comply with a number of additional governance requirements. If a professional trustee, acting as a co-trustee on a board of trustees, is asked to become a sole trustee, then due consideration should be given to running a formal tender process prior to the appointment being accepted.

The Accreditation Regime

PTSWG has opted for a two-part accreditation regime with an initial assessment, and then annual monitoring of continued compliance.

To be accepted as an accredited professional trustee, applicants must meet the following requirements:

– Comply with a ‘fit and proper’ requirement, modelled closely on the requirements for trustees of master trusts.

– Have references from two senior figures within the industry, such as existing accredited professional trustees, pensions lawyers or scheme actuaries.

– Have passed PMI’s full awards in Pension Trusteeship (or earlier equivalent).

– Have completed an online skills test designed to assess the ‘soft skills’ associated with professional trusteeship.

On an ongoing basis, accredited professional trustees

– Complete an annual attestation confirming that they remain ‘fit and proper’.

– Complete 25 hours’ of relevant CPD. Trustees’ CPD submissions will be subject to a random sample check applied to 10% of the total membership.

PTSWG has decided that the PMI should be appointed to oversee the accreditation process. The PMI has extensive experience as a membership organisation and also has a long-established understanding of trusteeship. The PMI also has extensive experience of providing qualifications for Financial Conduct Authority (FCA)-regulated advisers. The APPT will have an oversight capacity over the standards and the accreditation regime through a dedicated committee with broad membership.

When will this happen?

The PMI expects to provide details on the accreditation process in the near future and anticipates that it will have commenced by mid-2019.

Adam Simons

Senior Consultant