LEGAL & GENERAL UNVEILS â€˜INDEPENEDENT GOVERNANCE OVERSIGHTâ€™.
16 May 2013
A NEW ERA FOR GOVERNANCE OF CONTRACT BASED OCCUPATIONAL PENSIONS.
In an announcement yesterday (15 May), independent Chairman Legal & General WorkSave Mastertrust, Paul Trickett, unveiled the company’s plans to extend independent “trustee style” governance to strengthen governance of contract based workplace pensions for its clients.
Paul commented: “The current contrast in Governance between trust based schemes and contract schemes has been well publicised in recent times.
Of course, many contract schemes work with very high levels of governance, with the sponsor, their advisers and their chosen provider collaborating to the benefit of the members.
But many others do not operate with such high standards, and some schemes will be wholly reliant on the provider.
Even with the impetus of political will, it is difficult to envisage a situation whereby employers can routinely up skill to contribute meaningfully to the governance process, and many employers may have insufficient HR budget to pay for advice. So the governance gap may persist.
To help bridge this gap, and to avoid the potential conflicts inherent in a system whereby only the provider is responsible, Legal & General is implementing a new governance structure, called Independent Governance Oversight (IGO).
It is designed to work both with schemes’ own governance committees and to take sole responsibility where no other governance exists.
IGO will mirror the governance structure of Legal & General’s WorkSave Mastertrust where the balance of powers is independent of the Legal & General Group of Companies.
We will utilise the support infrastructure embedded for the Mastertrust so that our approach is consistent across the DC spectrum.
I will chair the committee, and the other members include Pitmans Trustees Limited and Directors of Legal & General Trustees Limited.
We will also be supported by an independent investment adviser. I firmly believe that IGO will help deliver better outcomes to members of Legal & General’s contract schemes and further raise the bar of contract governance as a whole.”
Notes to editors
Workplace Savings was named Corporate Platform/Wrap Provider of the Year (2013) and Auto Enrolment Provider of the Year by the UK Pensions Awards (May 2012) in the Professional Pensions Awards.
Winners of Corporate Platform Provider and DC Bundled Services Provider (2012) with FT Business pension & Investment provider awards.
Pitmans Trustees Limited:
PTL is a top five independent trustee firm with offices in London, Leeds and Reading. PTL acts as an independent trustee and provides a range of governance services, predominantly to occupational pension schemes, including trust based defined benefit and defined contribution schemes and contract based pension schemes including group personal pension plans. PTL also provides a range of governance services to other non-pension trusts. More information can be found on www.ptluk.com
The Legal & General Group:
The Legal & General Group, established in 1836, is one of the UK’s leading financial services companies. As at 31 December 2012, we were responsible for investing £413 billion worldwide on behalf of investors, policyholders and shareholders. We also had over seven million customers in the UK for our life assurance, pensions, investments and general insurance plans.
For more information please contact:
About Legal & General
Legal & General Assurance Society Limited.
One Coleman Street
London EC2R 5AA.
Registered in England 166055.