Monday, 1 November 2010

The Pensioner as stakeholder

Little more than a year ago my interest in the subject of pensions was confined to a natural concern about my own and how to live comfortably on it – now and in the future. Then the news emerged that I had been successful in the election held amongst the 38,000 Shell pensioners in the UK to become one of the two directly elected (by pensioners) Member Nominated Trustee Directors (MND) of the £11.4billion ShellPA Nov10 Contributory Pension Fund (SCPF). Given that I cannot claim to have any knowledge of, nor experience in, the arcane world of pensions you may wonder why I stood for election and, perhaps even more, why the Shell pensioner community chose me ahead of the other 22 candidates. The answer, I think, is that I firmly believe that pensioners are stakeholders in the enterprises that provide their pensions – both the funds themselves and the companies that sponsor them. And stakeholders of any organisation, and especially those of powerful multinational corporations, need articulate and determined representatives to protect their interests. I undertook to try to do this and the electorate put their trust in me that I would – so how is it going?

From the start the trustee training that I received, whether provided internally or by external agencies like the NAPF, emphasised the extent to which everyone in the world of Pensions, from the Regulator to professional bodies to corporate sponsors and the schemes themselves, was concerned that all trustees have adequate “knowledge and understanding”. Fortunately it was made clear to me that I was not expected to become a Pensions expert or to start practicing any of the many disciplines that operate in and around pension funds - and a good job too as many of these relate to the Law and to Financial Management neither of which would be my specialist subject on Mastermind! In my 37 years with Shell companies around the world I was fortunately never responsible for providing legal advice or for compiling statements of accounts. But as a member of various management teams over the years I did contribute, I think, beyond my own expertise areas of marketing and brand and communications. I was never shy about expressing an opinion nor nervous of asking the stupid question – characteristics which, I hope, will stand me in good stead in my Trustee role.

I am, then, an amateur trustee with no pretensions that in time I will become a professional one. I will continue to do my best, as the law requires me to, to become more knowledgeable about pension matters and there is plenty of help available to enable me to do this. Fortunately other directors of the SCPF Trust are experts in the various pension disciplines – as, of course, are those in our Trustee Services Unit, in Shell’s Investment Management company and in our various advisor agencies. The amateur trustee, like all the other trustees, has a statutory duty to represent all members at all times - but unlike the professionals he should be able to question or challenge without fear of revealing ignorance on matters on which he is supposed to be informed. Clearly you don’t want to be asking the same daft question too many times – but you should not be afraid of asking it in the first place. The Shell scheme permits any member to stand for election to the Trustee board from either the Actives or the Pensioner communities. I am biased, but I do think that this system is much preferable to that operated by some other large schemes where prospective MNDs put their names forward and are then chosen, in a selection process, by existing Board members.

A little under a year into my trustee role I am hugely enjoying it which, I hope, means that I will be able to contribute more effectively than if it was a chore. The Shell fund, a DB scheme which is still open to new entrants (albeit with slightly reduced benefits) and which is fully funded with a small surplus is in a comparatively good position. But legislative changes and social and political pressures are going to impinge one way or another on our fund and its members and the fact that the world of pensions is so much in the spotlight adds to the significance and to the challenge of the trustee role - we live in interesting times!

Paddy Briggs is a Member Nominated Trustee Director of the Shell Contributory Pension Fund. He writes in a personal capacity and the views he expresses are his own.

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