Trustee's changing Long Term Objectives
04 Nov 2019
70% of Trustees have reviewed their scheme’s Long Term Objective in the last 12 months, with many turning towards buy-out rather than self-sufficiency. However our research shows that many Trustees are not yet factoring in some of the newer end-game options to the decision process, such as consolidation. Hymans Robertson’s 'Understanding your DB Destination' paper explores each of the options available to help Trustees select the best one for their needs.
Elaine Torry, co-head of DB Investment and author of the ‘Understanding your DB Destination’ paper explains this shift in trustee behaviours:
“It’s not surprising that 70% of Trustees have taken TPR’s focus on setting appropriate Long Term Objectives as an opportunity to review their own plans*. We’ve seen a rise in popularity of trustees aiming for full buy-out while fewer appear to be targeting self-sufficiency. However, with 95% of trustees still working towards traditional goals it’s clear that more education and awareness is needed around the alternative opportunities now available. Trustees may not be fully considering some of the alternative self-sufficiency approaches or the newer end-game options such as exploring entering into a consolidator vehicle. By including some of these less traditional options into the review process, Trustees can have greater confidence in finding a Long Term Objective that best suits their needs and supports them to reach the best outcome for members.”