NETHERLANDS - The boards of pension schemes still aren’t sufficiently aware that they need to be in control and that just implementing internal management is not enough, claim two Dutch experts on corporate governance.

Proper arrangements on internal supervision are essential, and fit within the present debate on corporate government, said Peter de Koning, former member of the Tabaksblat Committee, and Stefan Peij, director corporate governance of Galan Group, in the daily Het Financieele Dagblad.

According to De Koning and Peij, many scheme board members are wrongly satisfied with the external supervision by the regulator De Nederlandsche Bank and the external accountant, or with the supervision from the sponsoring company.

“The effect is a looming increase of the involvement of the regulator in the internal supervision,” they said. “Moreover, there is a structural underestimation of the potential value of internal supervision. In the past the regulator has regularly been engaged with this issue, because pension funds hadn’t made proper arrangements themselves.”

“Both the external account and actuary are mainly serving the stakeholders and the general cause.

“Although the supervision at pension funds is usually implemented by several parties, in our opinion it is one-dimensional at the same time,” the pair stated. Both have been members of the committee for correct government of pension funds at the Dutch Association of Industry-wide Pension Funds, or VB.

They referred to the US Sarbanes-Oxley legislation, which requires companies to sign an ‘in control’ declaration. This considerably enhances their liability to internal supervision.

“The VB committee has established that the definitions and views of the Tabaksblat Committee for companies are very well applicable to pension schemes as well,” they added.

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