More than two thirds (68 per cent) of corporate defined benefit (DB) pension scheme sponsors expect to increase their use of professional trustees in the future, a survey by Hymans Robertson has found.

The research also found that over two thirds (70 per cent) of companies expect to review their trustee boards at least every six years or less.

There were a number of factors behind professional trustees' increasing popularity, as 47 per cent of sponsors said they were looking for better management of advisers and costs, while 43 per cent were having difficulty in finding future lay trustees.

In addition to this, 38 per cent wanted access to expertise of trustees involved in multiple schemes, while 36 per cent were looking to increase their use of professional trustees to tap in their board-chairing skills.

Hymans Robertson welcomed the findings, noting that schemes will need boards with expert skill sets to meet the expectations of The Pensions Regulator's (TPR) new General Code, and the evolving sophistication of endgame strategies.

However, the majority of companies were already confident in their current pensions governance models, as 72 per cent were confident that their scheme governance was fit for purpose to deliver a DB endgame strategy, while just 12 per cent felt their current trustee boards might be a barrier to delivering the company’s pension strategy.

Commenting on the survey results, Hymans Robertson head of DB endgame strategy, Leonard Bowman, said: “It seems clear from this research that the role of professional independent trustees in UK retirement provision will be a much more dynamic aspect of the future management of DB endgames, which could lead to positive change and improved outcomes for scheme members.

“Whether managing DB endgame strategies, open defined contribution (DC) trusts or new forms of retirement provision, the role of trustees in UK retirement provision will remain central for many years to come.

“It feels like this may become a much more dynamic aspect of the future, if companies follow through on their intention to regularly review their trustee boards and, in some cases, those reviews lead to change.

“Not only can we expect greater use of professional trustees, but how companies evaluate their professional trustees is also likely to evolve and become more sophisticated.

“Companies have standard governance timetables for reviewing their advisors but it remains to be seen whether their professional trustees will be integrated into this cycle in the future.

“If they are, we could see the development of more sophisticated corporate objectives and measures for their professional trustees, which could in turn lead to evolution in the professional trustee market. A culture of strong scheme and corporate governance are important to ensuring good member outcomes and would therefore be welcome.”

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