The survey report said that throughout the survey, larger
plans and especially DB plans stand out positively on all measures of good
governance. These plans are more likely to provide training support and to be
aware of the guidance issued by the regulator.
Among DB plans there has been a significant increase in
the proportion of plans with a subcommittee responsible for reviewing the
sponsoring employer’s business plans. However, among medium and smaller DC
plans, there has been a drop in those saying that the board regularly reviews
investment strategy, which the regulator says may be as a result of day-to-day
pressure on these businesses and the uncertainty within the investment markets.
There has been a significant increase (from 45% to 60%)
in the proportion of plans agreeing that they believe their board has
appropriate processes in place to manage conflicts of interest. The report
pointed out though, that only half (52%) of all plans maintain a register of
Overall awareness of the Trustee toolkit is 89%, and the
survey shows that the proportion of plans (and more importantly the number of
trustees within each plan) using the toolkit is continuing to grow. However,
one third of DC plans have not made use of the toolkit.
Despite nearly three quarters of plans reporting that
they have a documented risk register in place, only two thirds of plans are
very confident that they have appropriate internal controls in place to monitor
and mitigate specific risks. The propensity to have a risk register varies
significantly between large plans (91%) and smaller plans (59%). Confidence
in internal controls varies from two thirds (66%) being very confident of internal controls relating
to fraud, while just two fifths of plans (43%) have confidence in the
controls relating to data transfer.
At the time of the survey only one in five plans had
made use of the regulator’s communications guidance, according to the report, but
the regulator noted that the guidance had only been issued in the six months prior to the survey and usage is likely to
grow. Two thirds of large plans have used or considered the guidance issued
by the regulator compared to two fifths (42%) of small plans. Key reasons for
not using the guidance cited were a lack of awareness or insufficient time.
Though usage of the regulator’s guidance is low, most
plans reported they regularly communicate with their members, but few plans
assess the effectiveness of their communications, and only one in five plans would go so far as to say their board communicates very effectively.
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