Historically, many organisations have relied on the trustees’ advisers to also answer the scheme sponsor’s pension questions. With the increasing risks posed by defined benefit pension schemes, and also given the legislative focus (and professional focus) for the scheme actuary that his client is the trustees, first and foremost, it is sensible for all scheme sponsors to have an adviser who is completely independent from the trustees and their adviser. Professional guidance regarding conflict-of-interest and the need for the scheme sponsor to ensure that it is getting the most objective independent advice, from the trustees, makes is sensible to ensure the sponsor’s adviser is both separate from the trustees and not from the same firm.
Most most organisations have started to address this issue, if for no other reason than the requirement for a sponsor to be consulted by the trustees in relation to the formal funding valuations of the scheme and the scheme’s investment principles. If you have not already done so, now is the time to address this.
Good independent advice also brings with a “fresh pair of eyes” looking objectively at a problem with no vested interest. Sometimes the independent view may be challanging, but an honest objective assessment is important. We use our experience and “out of the box” approach to solutions to bring new solutions to what others may regard as insoluble situations.