Spotted an interesting article on FT.com headed “The paradox of professional trustees”.
At simplest a paradox is a statement that contradicts itself for example ”I always lie” is a paradox because, if it is true, it must be false.
My personal favourite is the Kleene–Rosser paradox which was developed by Stephen Kleene and JB Rosser, to show that the lambda calculus was inconsistent. I am not entirely sure what this means but suspect that;
1) I’ve been spending too much time in the company of actuaries and
2) that money directed to pure mathematical research is probably not particularly well spent.
The headline of the article appears to suggest, oxymoronically, or possibly just moronically, that trustees can’t be professional or that a professional can’t be a trustee. The article makes the point that there is nothing to prevent any idiot holding himself out as willing to act as a pension scheme trustee and seeking to charge for performing such a role. It highlights a trend for the great and the good of the pensions world to view acting as a trustee as a nice little earner to supplement their pensions. A sleepy wind down on route to the old folks home with a few long lunches and a decent claret or two along the way.
Anyone approaching trusteeship from this perspective will find themselves as irrelevant to the reality of the role they will need to fulfil as the Kleene-Rosser paradox is to the daily lives of you and me, and possibly just about everyone else on the planet, apart from Messrs Kleene and Rosser.
The article needs to be aware that not all professional trustees fit this stereotype – age and grey hair alone are no longer all that’s required .
Anyone acting as a trustee, professionally or otherwise, is faced with a challenging and dynamic pensions environment which is no place for those wishing to rest on their laurels. Try reviewing the guidance provided for trustees on the Pensions Regulator’s website for an idea of the breadth of knowledge required to adequately fulfil the role. Increasingly the trustee role is seen as something that poses risks for even the most diligent and enthusiastic amateur. Equally trustee boards are increasingly faced with contentious issues particularly around funding which throw up myriad conflicts of interest for those involved. The professional trustee is clearly a concept whose time has come.
The real problem, which in fairness the article does identify, is the lack of control over those who set themselves up to be a professional trustee.
- Just because someone is an excellent pensions lawyer does not mean that they are equipped to be a pension trustee.
- Just because someone is an excellent pensions actuary does not mean that they are equipped to be a pension trustee.
- Just because someone is an excellent pensions consultant does not mean that they are equipped to be a pension trustee.
A broad skills base is essential and we need to start to see acting as a trustee as a profession in its own right, not a place where old professionals from other disciplines go to die.
One positive recent development is the Pension Regulator’s consultation on its trustee register which has recently closed. The Regulator will obviously be keen to ensure that it suffers no further embarrassment such as that generated by the GP Noble debacle and companies thinking of appointing an independent trustee should be able to take some comfort in the revised register once it is available, as imposing some level of quality control in an area that has been sadly lacking in such to date.
So provided you do your research, and avoid the bull elephants thrashing impotently as the graveyard beckons, then there is nothing paradoxical about “professional trustees” nor, indeed, “intelligent journalism”.