Many UK companies are putting cost before quality when hiring members for their scheme’s trustee boards, research by Capita Fiduciary Group revealed today.

Only 38% of schemes have an independent professional trustee on their pension trustee board, the study found. Of the 219 finance directors questioned, 39% cited cost as their reason for not appointing a professional trustee.

Those who have employed a professional trustee have mainly done so for the quality of advice available. Specific reasons cited were having a wider knowledge of the issues facing the trustee board (59%), influencing better quality decision making by the pension trustee board (47%) and assisting the trustee board to work more effectively (35%).

Capita Trust Company head of pension trusts Michael Clark said: “A professional trustee is a key player in the resolution of pension issues which are increasingly key issues for the entire company. The value that professional trustees can offer far outweighs the outlay as evidenced by the views of those finance directors whose companies employ them. Indeed, a professional trustee is a way to reduce both costs and the risk to the company sponsor of the pension scheme.”

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