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The National Association of Pension Funds published its review of the 2001 Myners Principles. It concluded that overall standards of governance of
The six main findings of the review were:
(1) Since the Principles were first published, and even since HM Treasury undertook its Review in 2004, trusteeship has become more complex – the result of a harsh financial environment and an increased regulatory burden.
(2) There has been an increase in compliance across all 10 Principles, but progress has not always been even. But there are no significant ‘market failures’.
(3) There has been a step change in trustees’ knowledge and understanding.
(4) The Principles remain relevant, but are in need of refreshing to ensure they continue to reflect best practice and take account of legislative, regulatory and market developments since 2001. There is also scope to simplify and consolidate the Principles.
(5) Targeted help and support are needed to tackle areas of under-compliance, notably trustee self assessment and small schemes.
(6) The Principles should continue to be based on the voluntarist approach but with additional comply or explain reporting for schemes with assets in excess of £250 million in place of a mandatory Independent Compliance Review.
The NAPF made a series of recommendations which include:
- retaining voluntarism at the heart of the Principles, reinforced by a ‘comply or explain’ approach to reporting;
- replacing the current ten Principles with six high level Principles, supplemented by supporting guidance and toolkits to give trustees practical support (see appendix 2);
- the Principles should be co-owned by The Pensions Regulator and the Pensions Industry; and
- trustees should undertake formal self-assessments of their own performance and that of the Board.
NAPF Chief Executive Joanne Segars, said: “Only a few areas need further attention, including trustee self-assessment and our recommendations for change are directed at addressing these issues.”