UK pension fund trustees are underqualified and their performance is inadequately monitored, a survey by Watson Wyatt and Cranfield School of Management has revealed.
Few trustees have an investment qualification or a Pensions Management Institute designation, according to the research. The qualifications of most member-nominated trustees are particularly poor. Around 30 per cent of them have no relevant credentials and more than 40 per cent have only loosely related investment management qualifications.
And, while trustees see themselves as possessing suitable management experience, their performance is rarely monitored. More than two-thirds of trustees have never received a performance review and only 17 per cent of respondents said that there were measures in place to conduct such sessions.
A new culture of fund governance has to emerge and the trustee's role should be equated to that of a non-executive director of a plc, according the the research report.
"Trustees' capabilities are impressive, but their competencies may increasingly be examined,' said Philip Robinson, senior consultant at Watson Wyatt. "More needs to be done in order to cope with the demanding and complex pensions environment that most people agree is emerging."
Robinson called for better training, more delegation to expert advisers and the institutionalising of...