The chair of the pension trustee board should provide effective leadership, demonstrate decision-making skills at meetings, and encourage open and constructive debate.
You should arrive fully briefed on the agenda and prepared to discuss each item.
Boards should meet often enough to maintain effective oversight and control. In most cases this will be at least quarterly.
Importance of trustee board meetings
Trustee board meetings are a very important part of maintaining regular oversight of the running of a scheme. You should make sure that there is adequate time to discuss important strategic issues as well as scheme specific issues needing immediate attention.
Running effective trustee meetings is essential for good scheme governance. It ensures timely decision making, improves scheme efficiency and can help lead to good member outcomes.
Running meetings effectively
Compile an agenda and circulate it to the board at least two weeks before the meeting. You can use your scheme’s business plan to help focus the agenda points on strategic issues.
For meetings to be productive and effective, you should arrive prepared to discuss each item on the agenda. It’s particularly important that you’re clear on the decisions that need to be taken and the process for making those decisions. You are accountable for the decisions you make and you should make sure that you have access to all of the relevant information before acting.
Minutes should be taken at every meeting, paying particular attention to any decisions made, the reasons behind them, and any action points that need to be taken away.
An experienced and professional trustee secretary can help you to efficiently manage your meetings so that nothing is missed.
In general the topics that should be covered at most board meetings include:
- apologies for absence
- conflicts of interest
- approval and signature of minutes from previous meeting
- actions arising from previous meetings
- investment performance and strategy
- risks to the scheme (new and existing)
- administration including discretion cases and complaints
- member engagement, including communications
- sub-committee decisions
- trustee and adviser fees and expenses (ie budget monitoring)
- any decisions made since the previous meeting
- trustee training
- business plan
- notifiable events
- any other business
Trustee boards should meet often enough to maintain effective oversight and control, which in most cases will be at least quarterly
Role of the trustee chair
Improving the way you work
Lack of decision-making on the trustee board
The trustee board was required to appoint an investment manager to assist with the implementation of investment strategy and discussed this at a board meeting. Three investment managers were invited to pitch their services and one of the trustees couldn’t make a decision as to which manager to appoint, despite being armed with all the relevant information.
While a period of reflection can be useful to make a strategic decision, in this case there was no value in the decision being delayed.
The trustee chair should have been clear with the other trustees beforehand about the need to make a quick decision. If the trustee continued to delay in making a decision, and a majority of the trustees agreed to it, the chair could rule that a decision had been made without the delaying trustee’s vote. If the delaying trustee’s vote is needed, the chair should remind them of their duties, and that putting off a decision can be as bad for the scheme as making a poor decision. Creating the right culture within the board and setting the tone from the beginning would have reduced the chance of this scenario happening.
Agenda items not focusing on the long term
The agendas for the trustee meetings mainly focused on reactive, short term issues. The board didn’t set aside time for strategy. Dealing with urgent business in each meeting crowded out strategic agenda items and they had no time to discuss and evaluate how the scheme is meeting its objectives.
The trustees should have made more effort to produce the meeting agenda well in advance of the meeting (at least two weeks). The trustees should have consulted the scheme business plan to help focus the agenda on long-term strategic issues as well as scheme-specific operational issues.
Trustee behaviour in meetings
One of the trustees was a dominating force in meetings and stopped other trustees from speaking. The behaviour of the individual was preventing decisions being made and trustees struggled to find common ground.
The chair should have implemented a review process to evaluate board performance. The trustee should have been encouraged to work on their people skills and instructed to be less dominating in meetings. If the trustee’s behaviour did not improve, it may be possible to take steps to remove the trustee from the board.
Good working examples
Effective chair of trustees
The chair of the board displayed considerable knowledge and experience in both pensions and governance. The chair took time to summarise conclusions from each agenda item once discussions had drawn to a close, consistently asking fellow trustees if they have any remaining questions and was prepared to interrupt an adviser’s presentation to give space for trustee scrutiny and questioning.
Sufficient preparation for trustee meetings
All the trustees had taken sufficient time beforehand to read and digest the extensive meeting pack, including a large investment report. The trustees all contributed fully to discussions. There was no sense of any trustee being regarded as a ’junior partner‘, and they all seemed prepared and perfectly at ease with the subject matter.
Check your governance
Further information
Trustee toolkit online learning
The ‘The trustees’ role’ module contains a tutorial on ‘Trustee meetings ’. You must log in or sign up to use the Trustee toolkit.