UK pension proposal tips for trustee boards and advisers

15 August 2023

Whether you’re a trustee board or an adviser, being clear about your objectives during an RFP process is crucial to helping you meet your goals.

Being clear about your objectives promotes a better process and can help you select the adviser that’s best suited to help you meet your goals.

Whether you’re a pension scheme trustee board leading a proposal to hire an adviser or you’re an advisory firm pitching your services to a pension scheme, it can be a significant undertaking. 

Below are tips for both trustee boards and advisers to consider: 

Defining your objectives

For Trustee Boards

Invest time up front to think through holistically what you’re looking for from a service provider. 

Being clear about your objectives promotes a better process and can help you select the adviser that’s best suited to help you meet your goals. 

As you’re defining your objectives to engage a potential adviser – whether it’s an investment consultant, administrator, actuary, legal adviser, auditor, or professional trustee – think about what’s most important. 

For example, is it the: 

  • Person who will be the daily point of contact? 
  • The adviser firm’s reputation, experience, and service approach? 
  • Fees? 

Once you’ve landed on what’s most important to you, communicate that to the potential advisers so they can be responsive to your objectives. 

 For Advisers

Think through comprehensively what you’re looking for in a client, for example: 

  • How would this client fit into your client portfolio? 
  • How profitable will this engagement be? 
  • The benefit to your team in terms of experience that can be leveraged on other client engagements, and 
  • Finally, if it’s clear that your objectives don’t align with what the Trustee Board wants, it’s worth weighing up whether it’s better to bow out gracefully now versus engaging in a Request for Proposal (RFP) process with mis-aligned objectives. 

Considering Fees

For Trustee Boards

If you’re fee sensitive, it’s a good idea to be transparent about this from the start. Some advisers may opt to bow out of the process because they can’t accommodate your budget.  

On the other hand, you may have less rigid fee constraints, which may mean more options. 

Either way, if your adviser is performing well, you may ask them to take on more work than the original scope, which will increase the initial fee quote. 

You may want to consider asking early on for proposals for add-on work to help manage your overall budget and track spend. This practice can also help with planning for subsequent annual budgets. 

We would always advocate taking a value for money approach, sometimes paying higher fees for a service may reduce costs elsewhere. 

For Advisers

While it’s tempting to discount work to win an engagement, think through what margins you’ll be comfortable with and what it will take to be profitable. Then, to support your fees, articulate your firm’s value through specific examples during the process. 

Engage in a robust selection process

For Trustee Boards

A trustee board may invite several advisers to pitch. It’s important to communicate your goals, any fee sensitivity, use a detailed project plan, and stick to a timeline. 

You may also want to work with a third party to manage or support the selection process for, or with, you. 

At ZEDRA we use a five-step process to guide trustee boards through the selection process: 

  1. Define needs and create a detailed project plan, and put together a long list of possible advisers 
  2. Produce the RFP document and have it approved; then issue to agreed advisers 
  3. Evaluate the RFP submissions 
  4. Conduct interviews, presentations, make recommendations and selections 
  5. Manage any post appointment matters 

From a governance perspective, we also provide a clear audit trail of key milestones and decisions made throughout the selection process. 

For Advisers

It’s important to follow the requirements described in the RFP, differentiating yourself in both written materials and in-person meetings, and meeting deadlines. 

To help communicate your value: 

  • Demonstrate you’ve been listening by providing pitch materials that zero-in on the trustee board’s opportunities and challenges 
  • Provide examples of what your deliverables and reporting will look like 
  • Showcase dynamic and compelling graphics in your materials 
  • Ask for clarifications when necessary 
  • Ask for feedback and keep an open mindset 

When I asked my colleague, Lauren Branton, Trustee Executive & Project Team Lead, to share her tips, she commented, “Give examples of what you’re talking about to help the trustee board envision you in the role. Show them the technology you’ll use, what your team brings to the table, and how you’ll manage the overall engagement.” 

Keep in mind that your proposal submission is being evaluated in the context of competitors’ materials. 

In-person Q&A sessions & interviews

For Trustee Boards

Taking the time to hold in-person Q&A sessions for the full complement of potential advisers (“the long list”) and interviews for the finalist potential advisers (“the short list”) is critical to the selection process. While organising these meetings takes effort, they’re good opportunities to see the candidates in action and gauge their level of talent and experience. 

For Advisers

This is your opportunity to clarify questions and dig beneath the surface to make sure you’re matching up with what the trustee board wants. 

Keep in mind that interpersonal dynamics can be a powerful driver in the trustee board’s decision. 

Having good chemistry can be very important. When all else is equal, chemistry can tip the scales. 

How ZEDRA can help

Our technology, market position, and approach differentiate us. 

We use a project management tool that provides in-depth reportable project plans and task oversight. It helps us be streamlined, agile and transparent whilst ensuring all key stakeholders are aware of reporting timeframes. 

We work with around 60 institutional clients in the UK with assets ranging from £100m to over £45bn. In supporting our clients, we see how trustee boards and their advisers operate in practice, rather than simply on paper. 

We have a robust approach for reviewing advisers and believe in running a fair and transparent process so that both the trustee board and the advisers participating in the process are clear on objectives, review criteria, and timescales. 

Our professionals can help your pension scheme whatever your situation or goals. We support pension schemes with project management, strong governance, a focus on strategy and cost-effective implementation, and strengthening trustee decision-making for the long term.  

For more information, contact Judith Codling, Client Services Director or Lauren Branton, Trustee Executive & Project Team Lead.

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