Skilled delegates the way to ensure democracy
Paid pension fund staff clearly need thorough training in the business area relevant to their role. But the decision-making process at a fund involves many others. In Denmark, more pension funds are taking a serious look at the skills of their delegates elected by members, says Claus Skadhauge, head of communications at €14bn pensions group PKA.
Many important decisions are taken at the annual general meeting, Skadhauge points out. At PKA funds, members that are elected remain as delegates for four years.
"There are almost 800 of them in the eight pension funds in total," he says. "They propose and have to decide on, for example, changed benefit structures, adoption of the annual reports and accounts, and they are involved in discussions of the investment strategy.
"It is obvious that their skills and ability to see the implications of decisions and how decisions interact with an overall strategy for the fund are extremely important," he says.
"Otherwise you may risk eternal changes and decisions based on fluctuations and with no lasting strategy."
Because of this, the PKA boards have put a lot of effort and resources into the training of the delegates. It is the only way to take democracy seriously, says Skadhauge. If the delegates were not trained, there could be fluctuations in decision-making on the one hand, and on the other, the danger that delegates would shy away from proposing anything - thus leaving all decisions to the board or the administration.
PKA's training activities include courses held among shop stewards within unions. Whenever new delegates have been elected, they are offered a comprehensive six to eight-day training programme on aspects of the pension fund, eg benefits, investments, communications policy, insurance technique, service level and EU recommendations on pension funds.
They also have the chance to meet PKA staff and management. Some of the modules include PC-simulation programmes, where the participants can see the implications of solvency and traffic light scenarios on, for example investment strategy and return rate policy, says Skadhauge.
As well as this, delegates meet once a year to discuss specific items of current interest to the pension fund, he says.