New Code of Practice for Professional Corporate Sole Trustees of pension schemes

The new Code of Practice for Professional Corporate Sole Trustees of Pension Schemes (PCTSs) was published on 1 January 2021. The Code of Practice sets out guidance as to the processes and procedures which firms as acting as a PCST should implement and maintain these obligations falling on APPT members in relation to PCST appointments.

We’ve recorded a webinar on ‘How to comply with AAF requirements for the APPT PCST Code relating to sole trusteeships’ which you can access here.

Key items within the New Code of Practice include:

Appointment

Initial Appointment – Due diligence procedures should be put in place ensuring the sponsoring employer can decide whether to accept or not accept the appointment as a PCST.

Evolving from Joint Trustee to PCST – Due diligence procedures should also be performed where a trustee becomes a PCST through the death, retirement, resignation or removal of other trustees.

Removal and/or resignation of a PCST – Where required, the removal/resignation should be drawn to the attention of The Pensions Regulator.

Working with the sponsoring employer

Independence from the sponsoring employer – A Sponsoring Employer Independence Policy should be maintained.

Negotiations with the Employer – Procedures should be in place for when negotiations with the sponsoring employer to ensure they are conducted accurately.

Decision making

There should be a documented Decision Process outlining how decisions are taken and recorded so there is no influence from external individuals. Where there is a material decision to be made, at least two Accredited Professional Trustees should be involved.

Diversity and Inclusion

Diversity and inclusion should be considered by the PCST firm during their decision-making.

Appointment and review of Advisers and Service Providers

Appointment – Appointments of advisers and service providers should be based on the needs of the scheme which should be documented.

Review – Reviews should be performed once every three years.

Conflicts of interest – If appointed on multiple connected schemes, there should be appropriate processes in place to manage the conflicts.

Assurance reporting

It is a requirement of the Standards that PCST firms provide assurance reporting on internal controls in accordance with “ICAEW Relevant Trustee Supplement AAF 02/07 (TECH 04/13 AAF)”

Would you like to know more about how the requirements outlined within AAF can help support you meet the new Code of Practice, we’ve prepared a webinar on ‘How to comply with AAF requirements for the APPT PCST Code relating to sole trusteeships’ which you can access here.

Please don’t hesitate to contact us if you have any questions. You can reach by calling 020 7112 8300 or you can email us on info@assureuk.co.uk.