Trusteeship has never been more demanding. UK trust‑based defined benefit (DB) schemes are now operating in an environment shaped by shifting regulatory expectations, evolving endgame strategies and heightened scrutiny from sponsors, regulators and members alike.
After concluding its consultation on trustees and governance, the UK’s Department for Work and Pensions now faces a challenging question: how can policymakers and the industry improve standards while preserving the strengths that have made pension scheme governance successful?
There is a risk that, in the pursuit of higher standards, we overlook what already works. Trustees’ fiduciary duty remains a powerful safeguard for members and the flexibility of the UK framework allows governance arrangements to be proportionate to scheme size, maturity and complexity.
In many larger schemes, trustee boards now benefit from a blend of pensions expertise and specialist skills spanning investment, risk and covenant. Governance quality has improved markedly as a result.
One of the most important, and most easily overlooked, strengths of the system is the role of member‑nominated trustees.
Member-nominated trustees (MNTs) bring a lived member perspective that cannot be replicated through reporting dashboards or consultation exercises. They ask basic questions others may avoid, reduce the risk of groupthink, test whether decisions work for members in practice, strengthen communication and engagement, and help keep boards anchored to member priorities.
Many larger schemes also benefit from capable executive functions that are closely aligned with trustee objectives. These teams play a critical role in developing strategy, supporting the day‑to‑day running of schemes and managing relationships with advisers on trustees’ behalf, helping to ensure continuity, coherence and delivery against long‑term goals as they evolve.
“The focus should shift away from individual credentials and towards collective effectiveness”
Morten Nilsson, CEO of Brightwell Pensions
Yet pressures on trustees continue to intensify. While trustees are already required to maintain appropriate knowledge and skills, the reality is that application is inconsistent. The pension regulator’s Trustee toolkit, while valuable, is no longer sufficient preparation for the scale and complexity of today’s defined-benefit schemes.
A growing gap has opened up between foundational training and full professional trustee accreditation. Many lay trustees do not aspire to professional status, but still need stronger support to operate effectively on increasingly large and complex boards.
An intermediate training or certification pathway could help bridge this gap, raising capability without creating barriers that deter participation.
Advisers are an essential part of the ecosystem, but effective governance depends on trustees having the confidence and capability to challenge advice, assess value for money and determine the right governance, resourcing and operating model for their scheme. There are inevitable conflicts of interest and without sufficient trustee capability these may not always be fully understood or managed.
Raising standards in a way that is proportionate is important as overly onerous requirements risk shrinking the pool of lay trustees at a time when recruiting MNTs is already becoming harder as schemes mature and active membership declines.
This matters because diversity of thought on trustee boards is not a “nice to have”. It is central to good decision‑making. Member‑nominated and employer‑nominated trustees bring insight, authenticity and challenge that cannot be replaced by member panels or consultation exercises.
Focus on the collective
The focus, therefore, should shift away from individual credentials and towards collective effectiveness. What matters most is whether trustee boards can challenge and support their executive functions whilst scrutinising advisers and suppliers with confidence; manage conflicts of interest robustly; and select governance and delivery models that genuinely serve members’ interests.
Independent, periodic reviews of board effectiveness can raise standards without undermining diversity.
Conflicts of interest deserve particular attention. As professional trustee firms diversify their services and the market becomes more concentrated, trustees must be equipped to identify and manage commercial conflicts transparently.
Registers, disclosures and governance protocols are widely used, but their effectiveness depends on trustee capability and active oversight.
Looking ahead to 2030 and beyond, trustees will need broader skills, clearer regulatory direction and governance frameworks that balance rigour with pragmatism.
Raising standards is essential in an increasingly demanding environment, but it must be done in a way that protects what already works: independence, diversity of perspective and the common‑sense judgement that sits at the heart of effective trusteeship.
