Majority of trustees to stand by endgame strategy amid Covid-19

Three-quarters of trustee chairs do not expect to adapt their endgame strategy in light of the Covid-19 pandemic, according to research by Barnett Waddingham and Winmark.

The organisations’ latest Pension Chair Remuneration Report revealed that just 2 per cent of trustee chairs are sure they will need to change, while the remaining 23 per cent of trustee chairs felt it was still too early to know or don’t know.

However, whilst the majority believe they will not need to change their long-term objectives, 50 per cent expected to have to prioritise consideration of the pandemic’s impact on employer covenant strength or funding pension scheme deficits.

A further third (33 per cent) stated that they would be prioritising the impact on administration and governance.

The majority of trustees (60 per cent) stated that current endgame strategy was to achieve self-sufficiency, compared to 35 per cent who were looking for buyout or buy-in transactions.

Commenting on the findings, Barnett Waddingham partner, Danny Wilding, stated: “In terms of this year’s priorities, it is clear that trustee chairs remain focused on the key high-level strategic issues of de-risking and endgame planning.

“Existing long-term strategies appear to have shown a high level of resilience to the ongoing pandemic in general, although clearly a number of pension schemes will be focused on the financial consequences of Covid-19 for some time to come.

“There is also a clear endorsement of the benefit of professional representation on trustee boards this year, with over two-thirds of trustee chairs suggesting professional trustees can improve standards of governance and member outcomes.”

Indeed, 69 per cent of respondents stated that an increase in the number of professional trustees on boards has a positive impact on standards of governance and member outcomes.

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