PLSA 2019: DB trustees playing catch-up in harnessing tech

Defined benefit pension schemes are considerably behind their defined contribution counterparts in harnessing technology to inform members and improve trustee governance, it has been said.

Speaking at the PLSA Annual Conference 2019, Willis Towers Watson senior director Gareth Strange led a session detailing that DB schemes are “behind the curve when it comes to tech”.

Strange highlighted that where 90 per cent of adults in the UK use the internet regularly, trustees need to respond quickly to the fast moving market.

Examples of technology for DB schemes included a modeller, similar to those already in place for DC schemes to assist members with understanding how much they will get from their pension pot.

This can also help to inform members who are considering transferring out of their DB scheme, Strange said. With high numbers of industry members noting that a scandal in relation to transfers is likely, information of this kind could help to create better informed members who are less likely to make damaging decisions.

Also speaking on the panel, Fujitsu head of pensions and benefits noted that in the Fujitsu scheme, it has been realised that consumption of information is much higher when members are provided with video communications in comparison to letters.

Furthermore, technology can also significantly improve trustee governance and operations, the panel noted. This was highlighted in a survey by WTW found that 53 per cent of respondents think technology will improve governance for schemes in the next five years.

Platforms for trustees to directly access scheme and member data could completely transform trustee meetings, Strange said.

At present, Willis Towers Watson’ trustee platform is operational for three schemes, with seven more also looking to incorporate it into their business activity. The platform provides easier and more accessible member data, a scheme funding tracker among live administration data, among other features to improve the trustee conversation.

“Technology will help members to make the right decisions for them and reduce the cost of advisers [for trustees], creating time to focus on strategy instead,” the panel concluded.

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