General code in force: 28 March 2024
This module forms part of our expectations for trustees of those schemes required to operate an effective system of governance, see Systems of governance.
- This module applies to schemes required to maintain an effective system of governance1, (see Systems of governance), and to the pension boards of public service pension schemes.
- It is important that the governing body, or pension board, can demonstrate that, as a group, they possess the skills, knowledge, and experience2 to run the scheme effectively.
- The governing body should:
- have a balance of skills and experience throughout the board and be able to demonstrate this
- be able to apply its knowledge to governing the scheme
- have enough skills to judge and question advice or services provided by a third party
- be able to identify and address skills gaps
- have enough understanding of industry good practice and standards to assess scheme performance and its service providers. See Managing advisers and service providers.
- keep records of the learning activities of individual members and the body as a whole
- be able to demonstrate steps it has taken to comply with the law
- have and maintain training and development plans to ensure that individual and collective knowledge and understanding is kept relevant and up to date. See Knowledge and understanding.
- Members of a governing body should be aware that their responsibilities and duties begin from the date they take up their post.
- Members of governing bodies required to have knowledge and understanding should invest enough time in their learning and development, alongside their other responsibilities and duties. Governing bodies should provide the necessary training and support. Trustees of occupational pension schemes have the right to time off to perform their duties as a trustee of their employer’s scheme and for trustee training3.
- Learning programmes should be flexible, allowing those taking them to update areas of learning and to acquire new knowledge. Members of governing bodies who take on new responsibilities will need to ensure they gain relevant knowledge and understanding.
- As a matter of good practice members of governing bodies can work towards completing our trustee toolkit (or public service toolkit for members of pension boards of public service schemes) or equivalent learning programme.
- To enable governing bodies to ensure their knowledge and understanding is established and maintained, members of a governing body should:
- be able to demonstrate the basic level of knowledge and understanding needed to run their scheme within six months4 of their appointment5.
- start on a programme of learning immediately on appointment, if not before, in conjunction with a scheme-specific induction programme, if one is provided
- undertake advanced scheme-specific learning once a good understanding of the scheme has been obtained
- consider how they are meeting our expectations of knowledge and understanding.
- review their own knowledge and understanding and identify any gaps at least annually, particularly in relation to changes in legislation or their scheme
- keep records of any review of knowledge and understanding and steps taken to address any gaps
- keep records of any alternative or further learning activity (for example, reading, attending conferences, sessions with the scheme advisers)
Legal references
1 Section 249A Pensions Act 2004 [Articles 226A of The Pensions (Northern Ireland) Order 2005]
2 Sections 247-248 Pensions Act 2004
3 See section 58 of the Employment Rights Act 1996 [Article 86 The Employment Rights (Northern Ireland) Order 1996]
4 This does not apply to professional trustees, or those appointed to the governing body in a professional capacity, or for their specialist expertise. Those individuals should be able to demonstrate the relevant competency from the day of appointment.
5 Sections 247 and 248 of The Pensions Act 2004 [Articles 224 and 225 of The Pensions (Northern Ireland) Order 2005]