Covid-19 has caused significant disruption to economies worldwide, with policymakers, businesses and individuals dealing with a wide variety of challenges brought about by the rapidly evolving situation.

Defined contribution (DC) schemes face tough questions on administration, member communications, investment, governance and support on decumulation options. As trustees you may have already taken some immediate steps to deal with the current situation.

Here are some key points the PLSA believes trustees should focus on next:

Administration: Trustees should ask administrators how many of their employees fulfil the definition of “key worker”. Try to understand to what extent contact centres may be remote working and the impact of staff illness on operations. Ensure administrator has a clear sense of trustee priorities and proactively engage with administrators on member queries.

Communication: Once initial crisis communications have been issued, trustees should step up efforts to protect members from scams, warning them against cold calls and other ‘out of the blue’ forms of contact. Members may also be concerned about market fluctuations and it is important that any at retirement decision, or fund switch, they make is suitable for the long term. Members concerned about scams and Covid-19 generally can be signposted to the Money and Pensions Service website here.

Governance: Once trustees have assessed how their operation will be affected and have plans to hold an emergency trustee meeting, they should then have a strategy in place for future meetings, ensure board effectiveness is maintained and also assess cybersecurity implications of changed working habits.

Investment: Covid-19 has unleashed significant volatility in global markets and a sharp fall in every major stock market. Trustees should therefore, consider the longer-term impact, consider possible investment opportunities as well as check the implications for AGM season and their approach to stewardship.

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