Managing Conflicts of Interest; GOOD ADVICE
Byline: Asmah Baig
ARE you a senior employee and a trustee of your company pension scheme? Are you a member nominated trustee?
There is heightened awareness of conflicts of interest in relation to pension schemes through draft guidance issued by the pensions regulator. This guidance is designed to assist trustees in managing conflicts of interest. It is based around five principles which the regulator believes will help trustees assess whether its governance arrangements are sufficient for the management of conflicts of interests.
1. Understanding the importance of conflicts of interests.
There is an emphasis on the importance of trustees' awareness of its fiduciary duties to the scheme members. Trustees should be able to identify the different types of conflict which may arise as a consequence of their personal circumstances (the classic example being where the finance director of the company is also trustee of the pension scheme).
2. Conflicts of interest policy.
Trustee boards are advised to agree, document and regularly review a policy managing conflicts of interest which should be reviewed by the scheme's legal advisers. …