A friend of mine who I respect a lot tells me that pension trustees should be abolished. It is not a view that can be taken seriously at a time when the various pension codes issued by the Pensions Regulator place such importance on trustees. But the challenge now is that trustees spend more time being compliant to these codes than caring for their members.

It could be argued that their fiduciary responsibility to members is to exercise what they consider the best for members , but I wonder how many trustees are these days taking their own decisions when it comes to investment. They choose their advisers it is true but the advisers then choose the strategy and have a major say in its implementation. To say that trustees take fiduciary responsibility is to ignore both compliance to the regulatory codes and the advice of consultants and no trustees is going to do either, unless very brave.

For the most part, trustees boards are ridding themselves of representatives who act for the member (the member nominated trustee) or the sponsor (the employer sponsored trustee). The rise of multi-employer DC schemes (and soon CDC schemes) allows trustee boards to be given over to corporate trustees who may act in their own name or that of the corporate trustee body. Either way they are arguing that they should be the voice of trustees in schemes.

An office or a prison for trustee’s views?

Most recently, trustees have (for the new CDC schemes) been banned from marketing or promoting their scheme, again their fiduciary responsibility is being defined by a third party.

Trustees are responsible however for acting as compliance officer on the material of the CDC’s proprietor and as such an extension of the Pension Regulator’s authority. Let us look at a case study.

Case study ; the diminishing room for trustees to exert conviction

I was recently told by a senior regulator that I was not acting in the interest of CDC by quoting the Government’s announcement , issued on 22nd October 2025 , that CDC can deliver up to 60% more than a DC pension. Is this considered a prudent position for trustees to take? The Government’s own impact statement backs up the statement with the studies of senor sources.

• A range of studies have estimated large benefits, including from Willis Towers Watson, PPI, and Government Actuary’s Department. Further details on the reports are included in the Department’s Impact Assessment published alongside the legislation.

It is not just TPR who are whispering in the ear of those appointing trustees, it is the PRA a member of which argued with me about the number on social media.

There is very little that can be done but listen to the views of the trustees and if those views are influenced by regulators who take a position against the studies and the DWP, then trustees can control the promotion of their scheme and hide behind their duty to comply with a requirement not to promote the scheme.

The regulators could be influence by the PRA for all I know, but let’s not deny it , Government has spoken and for all the talk of fiduciary responsibility, Government is elected by us to be authoritative.

I am not sure whether a trustee would have allowed the Government to make this statement , if it had been pension trustee to the DWP!

How the room for trustees to exert conviction is diminished

To end on the lack of independence of trustees to act on the behalf of the members, let us remember that the majority of professional trustees not only have to comply with the regulator’s codes but to the house views of the firms of trustee’s that they sign up to. These trustees are often employees and if not they are required to attend meetings and read compliance documents to ensure that the house view is followed.

For a trustee to take a decision when controlled by the organisation they are part of , TPR that regulates them and the reality of getting paid, makes the exercise of personal conviction very hard.

Which is why I can see why my very senior friend’s view that trustees are no more than compliance officers has sense. But I stop here, although they must take advice, they have the choice of the advisers, have the right to fire them and get new ones in and though they have diminishing responsibility to assert the value of their scheme to its members , they have the right to listen to their members and act in their best interests.

I do not think we have heard the last of the independent trustee. Vidett (a thriving firm of professional trustees) , spoke at the Pension Age conference last week and found their argument for firms like theirs to take control of trusteeship ran into a storm of opposition from independent trustees in the room.

Which is why we should have member nominated trustees and trustees who choose to participate in commercial multi-employer schemes. In these schemes there is a third constriction of power for trustees which is that the commercial decisions of the provider of proprietor of the scheme is ultimate decision making on much of what trustees once chose themselves.

There is a new world for trustees to do good. Their capacity to exert conviction is much diminished but they can be more than compliance officers. We should  stand up for their independence at a time when it’s under massive challenge.