The €1.3bn Dutch Nedlloyd Pensioenfonds (NPF) plans to replace its current board based on equal representation with a ‘one tier’ model with full-time staff.

According to Frans Dooren, the scheme’s director, the pension fund wants to boost its governing power by incorporating the professional expertise of full-time executive members into the independently chaired board.

Under the proposal, Dooren and Randy Caenen, the new head of finance, control and risk management, would become the executive part of the board, with current board members to become the non-executive component.

However, supervisor De Nederlandsche Bank (DNB) has yet to approve the change or the proposed board members.

The new board model follows Nedlloyd’s decision to end its advanced individual defined contribution (DC) plan – introduced in 2015 – which allowed its participants to place their individually accrued pension rights into a collective DC pot at any moment.

The DC plan had just 500 active members, which Dooren said was too low for an acceptable cost level, adding that a significant increase in numbers was unlikely.

Other Dutch subsidiaries of Nedlloyd’s parent company, shipping giant Maersk, had placed their pension arrangements elsewhere, meaning NPF missed out on roughly 2,000 additional members for its DC plan, Dooren said.

The pension fund has said that the assets – run by Robeco – could be collectively transferred to a new provider or, alternatively, could be used to purchase pension rights at NPF.

NPF said that it intended to continue as a closed scheme for its 3,000 deferred members and 7,000 pensioners as of 1 January 2020.

Dooren said this would be an “excellent” option if combined with NPF’s current management arrangements.

“With a funding of 125%, we are in good shape,” he said. “This year, for example, we have granted full inflation compensation of 1.9%.”

He also indicated that NPF was assessing whether administrator RiskCo – which took over from previous provider Aon Hewitt – was the right partner for NPF.

“Although we don’t want to switch providers per se, the change poses an opportunity for checking the alternatives,” he explained. Aon had been NPF’s provider since 2014.

Dooren also said NPF was in talks with the €1.1bn Pensioenstichting Transport regarding options for co-operation between the two schemes.

Reaching an agreement had turned out to be trickier than expected, Dooren explained, because of specific differences between the pension funds.

In 2017, NPF revealed that it was in discussions with six schemes for co-operation on areas such as investment, board support and actuarial and legal matters.

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