Pension boards lack diversity but not the desire to improve

Results of The Pensions Regulator’s (TPR’s) first trustee diversity and inclusion (D&I) survey, published today (Tuesday), shows the ‘typical trustee’ is a white man who is over 45.

Completed by 2,197 trustees, making it TPR’s largest-ever survey, the results will provide a baseline to measure progress towards ensuring high standards of diversity and inclusion on pension boards.

The results highlighted industry recognition of the importance of inclusive and diverse boards with 78% saying they felt a diverse trustee board was important. There was also broad consensus that diverse and inclusive pension boards are important for good decision-making (84%), good governance (83%) and good member outcomes (85%).

While the survey highlights the lack of trustee diversity in terms of protected or visible characteristics such as ethnicity, most trustee boards were seen as diverse in terms of skills (82%), life experience (74%), professional background (73%), cognitive diversity (73%) and education (61%).

Louise Davey, TPR’s Interim Director of Regulatory Policy, Analysis and Advice, said: “Growing evidence shows diverse and inclusive boards make more effective decisions, which is key to good governance and improving saver outcomes.

“While the profile of the ‘typical’ trustee is unlikely to be a surprise, this survey has supplied important baseline data we can use to measure progress towards more diverse and inclusive scheme boards.

“It also shows the majority of trustees recognise the importance of greater board inclusivity and diversity, although fewer than half of schemes have taken action to improve.

“We want trustees to think about diversity more widely than just through more visible characteristics and consider their boards’ skills, life experience and cognitive diversity as well.

“Those wanting to improve their scheme’s board should take advantage of our latest guidance, which provides practical ways to improve board diversity and inclusion.”