The aim of the Independent Governance Group (IGG) is to support UK scheme trustees, not replace them, as it continues to grow to build the scale and skills needed for the job, according to chief executive officer Andrew Bradshaw.
IGG was set up in February 2023 after Ross Trustees and Independent Trustee Services merged.
The first year was very much about “growing scale” according to Bradshaw. In the first half of the year the team grew by 27% from 119 employees to 152.
In January this year, IGG acquired IC Select, expanding its services to include the selection and oversight of investment consultants and fiduciary management providers.
But growth will not stop here, according to Bradshaw. He said that IGG is always “looking out for opportunities” as the demand continues to grow.
“If we think that there’s a particular skill set that we can improve on, or a particular trustee function and we think there’s a bit of business that we can bring in to help us deliver services, we’ll look at that,” he said.
He pointed out that the number of schemes is not going away, and there are still “lots of schemes” that don’t have professional trustees with good secretarial support.
Supporting trustees
But Bradshaw said that IGG does not intend to replace member nominated trustees (MNTs), instead it wants to support them.
IGG acts as a co-trustee for several schemes, he said, and this model works “quite well” in the financial services industry “where you’ve got a very engaged workforce, and a good quality MNTs coming forward”.
But smaller, medium sized schemes, in different industries with different workforces often struggle to find people, he pointed out.
Instead of fully replacing MNTs, Bradshaw suggested there could be a middle option. “They don’t have to be a trustee, but we can recreate that role by setting up a consultative committee,” he said.
“From the corporate’s perspective, they’re happy that the scheme has been managed appropriately by professionals with the appropriate skill sets, but you don’t lose the link with the members.”
This could ensure the communication aspect of the role remains, but without the duties of being a trustee and all the training requirements.
Bradshaw pointed out that MNTs are “really good at communicating things with members” especially when “big changes” are happening.
He said it would be “a shame to lose that whole section of the market”.
“It’s about supporting them when we’re co-trustees and helping train them. And if corporates want to put in place professional corporate sole trusteeship where there won’t be any MNTs, it’s about finding a way to keep the link with the membership, so you don’t feel too disconnected from the membership in terms of keeping them updated on what’s going on,” he explained.
Smaller schemes
Another area in which IGG wants to get involved in is smaller schemes, Bradshaw said.
“Historically, we’ve looked after some smaller schemes, but mostly medium and larger ones. And we really want to play our part in that part of the market, where a lot of the quality professional trustee firms haven’t previously been involved because the schemes are too small,” he noted.
Bradshaw disclosed that IGG is working on a new product that will help get access into that part of the market.
He said that for professional core trusteeship, traditionally there is a team working on a particular client, but IGG is looking at how it can make that more efficient.
The firm is considering how it can work internally in a much more efficient way. For example: “Can we start to have trustee meetings where we have, say 10 small schemes with one particular advisor, so you get the benefits of consolidation, but you do it through a professional corporate sole trusteeship?”
The details are still being worked out, but Bradshaw said IGG plans to launch the product in the summer with the aim of becoming “an aggregator in that smaller scheme bit of the market”.
He pointed out that the government and The Pensions Regulator have asked the industry to come up with ways that can help out in that particular part of the market and that is what IGG is looking to doing this year.
He said: “That’s a bit of the market we haven’t catered for, but we have thought about it quite deeply.”
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