UK – Custody services provider Northern Trust says the government’s recent pension reform proposals did not address a key aspect of the Myners report dealing with the independence of custodianship.

”We’re almost back to before Myners raised the question,” said Steven Hayward, head of UK pensions relationship management at Northern Trust.

He says the government’s Green Paper on pensions, released on December 17, did not even mention independent custody, although it was one of three areas addressed by the Myners report in 2001, along with trusteeship and corporate governance. Indeed, a word search through the paper reveals no mention of custody.

"The fact there was no reference to independent custody seems to confirm our view that it was unnecessary to legislate in this area. However, it would have helped to close the debate if there had been an acknowledgement that this should be adopted as industry best practice."

Hayward says the proposals could have acknowledged that the appointment of an independent custodian should be a conscious effort by trustees, not just part of a package of services delivered by the investment manager.

Chicago-based Northern Trust has 1.44 trillion dollars in assets under custody.