On the go: Nearly two-thirds of defined benefit scheme sole trustees have earmarked technology as their biggest challenge for the next few years, according to new research.
A Hymans Robertson survey of professional trustee companies found that eight out of 13 respondents, or 62 per cent of companies, said that their biggest challenge is the need to have technology ready “to support the continuous scheme management style that suits sole trustees’ governance approach”.
Just over half of sole trustees (54 per cent) were, meanwhile, concerned about resourcing demands from schemes.
The same proportion also highlighted the imminent challenge of embedding the new DB funding code. The Department for Work and Pensions published its consultation into DB funding on July 26, which proposed that schemes will need to be funded in such a way that they are in a state of “low dependency” on their sponsoring employer by the time they are significantly mature.
The report also revealed that growth in the sole trusteeship market surged by more than a 10th in the year to March 31 2022.
Five per cent of schemes with assets of more than £500mn have now adopted sole trusteeship, with the consultancy predicting that around a quarter of sole trustee schemes are expected to agree buyouts in the next five years.
“While a number of sole trustees have considered how technology can drive real-time scheme management and strategic progress for schemes, only a small number are already on an active journey to introduce more efficient, digitally led processes,” noted Shani McKenzie, head of sole trustee services at Hymans Robertson.
“The remainder see it as a longer-term need,” she added.
“The issue with taking a longer-paced journey is it could lead to under-resourcing and inefficient processes, both of which could then go on to create delays in scheme progress and problems around governance and consistency.”
