Trustee chairs may be required to demonstrate how their trustee boards are diverse, The Pensions Regulator (TPR) chair, Sarah Smart, has warned.

Speaking at the PLSA Annual Conference, Smart stated that “we definitely want to be in a position where we can get trustees to make sure their trustee boards are getting the diversity that is out there”.

“We do want to see change," she continued. "We are all conscious of the lack of diversity there is in many trustee boards. There might be some movement at some point if we don’t see change of ‘can you demonstrate as a chair of the board how you feel you have got diversity?’”

"This approach would be preferable to mandating “x per cent diversity” Smart added. “Ideally, I don’t think we want to go down that route. But it’s a question we want boards to be able to ask themselves and then for the chair be able to answer.”

In July, TPR launched a trustee diversity and inclusion survey to help understand the current picture of trustees’ diversity and measure progress in promoting high standards of diversity and inclusion going forward.

The survey looked to understand the proportion of trustees with protected characteristics, their academic and socio-economic backgrounds and work experience, as well as trustees’ views on diversity and inclusion, in a measurable way to allow the regulator to detect changes in sentiment over time.

The survey also aimed to understand what diversity and inclusion data about trustees is being recorded by schemes and its intended use, and record the action being taken to ensure diversity and inclusion among trustees in their work.

Meanwhile, in September, The Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) proposed new measures to boost diversity and inclusion across the financial services sector.

Proposals set out by the regulators would include requirements for firms to develop a diversity and inclusion strategy setting out how they could meet their objectives and goals. Firms would also be required to collect, report and disclose data against certain characteristics, as well as set targets to address under-representation.

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