Wednesday, 17 January 2018

    The independent trustee market: The trustee chair's view

    Sarah Smart, chair of the Pensions Trust, gives her view on the independent trustee market in the second of this four part series

    On boards everywhere I think there is a very mistaken belief that if you’re a good executive then you’re necessarily a good non-executive, which really doesn’t follow. And if you’re a good consultant or adviser – or just if you’ve got pensions experience, then you will become a good trustee. I don’t think either of those things follow.

    I think that for being an independent trustee the requirements really differ depending on the needs of the scheme, and whether it’s more of an executive role for smaller schemes, or a non-executive role. I don’t think schemes and employers who may be choosing the independent trustees really do enough to say what their requirements are and I don’t think their selection processes are rigorous enough either.

    The chair needs to be a leader, but not a really dominant leader. To my mind the chair needs to lead the group, lead the board and the executive team if there is one, to a certain extent, make sure they’re the right dynamics in the board.

    There’s quite a lot of coaching to be done as chair – coaching of board members, and coaching of the executive, because a lot of the chair’s role is making sure that the right amount of information is provided to the board to make sure they can make good decisions. That doesn’t just mean the decision the chair wants to come out, because a chair will always know so much more about what’s going on with the rest of the board because they’re closer to it, and a good chair efficiently makes the relevant information available to the board so they can collectively make a good decision.

    Often people say there’s no such thing as a stupid question. There is such a thing as a stupid question, actually. . Stupid questions are ones that completely take the discussion away from where it should be, and missing the point, and getting into a level of detail that is operational and not relevant.

    A good chair can spot a stupid, stupid question and politely bring the discussion back to where it needs to be, but also can spot a good stupid question and make sure they don’t close the discussion down at that point, and say “That’s a very good question actually – let’s explore down that route”.

    I think that’s a really subtle skill that good chairs have, and recruitment processes need to try and identify.

     

     

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