Sections

DNB warns of 'impure decision-making' due to conflicts of interest

Related images

  • Dutch Netherlands

Tags

Related Categories

Most pension funds’ boards pay insufficient attention to potential conflicts of interest of policy makers, pensions regulator De Nederlandsche Bank (DNB) has suggested.

It indicated it was not satisfied with the outcome of a sector-wide survey, during which it checked whether schemes had conducted a risk analysis or had formulated a policy on conflicts of interest.

DNB concluded that a large number of pension funds had not conducted an analysis, and had at best a policy that was not based on such a risk assessment.

Additionally, it found that many schemes did not declare and register the main functions and jobs on the site of board members and other decision makers, and did not have a view on their private interests either.

However, almost all pension funds had rules in place for how to deal with gifts, according to DNB.

In its opinion, merely a handful of pension funds fully managed the risks posed by conflicts of interest.

The watchdog commented that conflicts of interest could lead to “impure decision-making, which could harm pension funds”. Therefore, trustees must actively fight conflicts of interest, it said.

DNB added that, during discussions with trustees, it had noted that the subject is charged, and that the sector needed clear examples as to what constituted a conflict of interest.

As a consequence, the supervisor announced that it would draw up a number of good practices.

 

 

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2492

    Asset class: Active Investment Grade Corporate Bond.
    Asset region: Global.
    Size: In the region of £2 billion.
    Closing date: 2018-12-10.

  • QN-2495

    Asset class: Large & Mid & Small with bias to Mid Equities.
    Asset region: Switzerland.
    Size: CHF 30m.
    Closing date: 2018-12-10.

  • QN-2496

    Asset class: Commodities.
    Asset region: World.
    Size: CHF 100 – 150 m.
    Closing date: 2018-12-12.

Begin Your Search Here