Professional Trustee Accreditation
25th February, 2020
The use of professional pension trustees has increased materially over recent years. More and more pension schemes are using professional trustees to help them meet the increasingly challenging governance standards set by the Pensions Regulator. This has led to trusteeship morphing from a small cottage industry dominated by late-career pensions specialists moving in to trusteeship prior to retirement to a vibrant, innovative industry attracting increasingly younger professionals from more diverse backgrounds who are developing their own long-term professional trustee careers.
Alongside this growth, there is a requirement to maintain quality and standards and the Pensions Regulator referred to the “accreditation” requirement for professional trustees in its recent response to the consultation on the Future of Trusteeship and Governance. The accreditation process is there to ensure those acting as professional trustees meet minimum standards, providing pension schemes with reassurance that professional trustees will make a real positive difference to the running of those schemes. However, whereas in the past an accreditation regime did not exist at all, now there are two. Further, these two accreditation processes are very similar and they seem to be competing with each other.
Firstly, the Association of Professional Pension Trustees (APPT) announced its accreditation framework. This is based on three pillars that professional trustees need to meet – exams, a fit and proper test and wider credentials (for example experience, references and CPD learning). Shortly after this, the Pensions Management Institute (PMI) launched their own accreditation program which appears very similar to the APPT’s program. So now we are in a position where there are two programs which has led to confusion and frustration amongst the pensions industry.
There are now two incredibly similar accreditation regimes which is unhelpful to the industry, could potentially cause confusion and undermine the benefits an accreditation programme was meant bring to pension scheme governance. However, with a choice of accreditation regimes now available, professional trustees are having to carefully consider which they want to follow. Whilst our strong preference was for a single accreditation process, we now have to decide between the two. What’s best, an accreditation regime run by professional trustees for professional trustees, learning and developing from direct experience or one run by a third-party commercial organisation? Whilst as a firm we remain supportive of the PMI, with regards to accreditation our intention is to continue to support the APPT’s accreditation process going forwards. We will be putting all of our professional trustees through the APPT’s process.”