Please note: this programme is subject to change
Private sector pension provision is almost exclusively DC and therefore the amount contributed to these schemes and the way they are managed and invested will significantly affect the retirements of many of today’s workers. With more saving into DC comes certain challenges. Those saving in DC pensions bear more risks, and as the nature of working and retirement change, managing these risks is becoming increasingly complicated. Alongside these challenges, Government and industry are also working to tackle retirement income gaps for women, ethnic minorities and other “underpensioned” groups. Industry, Government and member representative bodies are working hard to ensure pension members have a Future in Hand, and are looking for ways to support navigation of the changing tides of DC pensions, so they can smooth sail to retirement success.
This session will address:
- The rise of DC in the private sector and the reasons behind this
- The transfer of risk and the changing needs of pensioners
- How the needs of tomorrow’s pensioners may differ from todays
- Inequalities within the system (ethnicity, gender, self-employment, disability, caring)
- The role of policy and industry in ensuring that future pensioners can meet their needs from DC saving
As DC savings become an increasingly significant proportion of people’s retirement assets, the need to support individuals to generate a sustainable lifetime income from their DC savings is becoming increasingly pressing. How can we do this and what are the main challenges? Can we achieve the best of both worlds by harnessing both guaranteed income and flexible drawdown? In this session Esther will explore some of the latest thinking in this area and share her insight on the key challenges which need to be overcome.
Member engagement is crucial for the success of DC pension schemes, as it helps to ensure that individuals are taking an active role in building and managing their retirement savings. There are several key reasons why engagement is imperative to members, including: Increased savings, better investment decisions, improved confidence in the scheme, improved retirement outcomes, and enhanced member communication. By encouraging member engagement, DC pension schemes can help individuals to take control of their retirement savings and to prepare for a more secure financial future. This requires a focus on providing clear and accessible information and guidance, as well as regular opportunities for members to engage with their pension scheme.
This session will address:
- How can schemes improve members' awareness and understanding the options available to them?
- How can we simplify the wide range of investment options and reduce the sense of "choice overload"?
- What tools are on offer to schemes to improve engagement levels for their members?
- How can we improve engagement for those who are digitally excluded?
At this seminar, Gareth Craft and Jack Gillions from the Linklaters Pensions team will discuss some of the key legal hurdles Trustees need to overcome, viewed through the lens of the member’s perspective and experience, on transfers to a DC master trust and when entering the decumulation phase. They will look at some of the key practical and regulatory issues faced by Trustees when giving guidance to help members navigate the options during the decumulation phase, along with the potential legal risks of introducing decumulation options into a scheme at retirement.
The low-rate, low-yield environment of recent years has given way to a new fixed income landscape, presenting both promising opportunities for returns and potential risks to navigate.
Looking ahead, we anticipate higher and more volatile inflation, increased interest-rate fluctuations, a tighter monetary policy, greater market dispersion, and periods of market upheaval. This allows DC investors to have an opportunity to harness the potential for long-term returns through diversified exposure to fixed income. By incorporating that strategic diversification and conducting thorough research, DC investors could have the opportunity to enhance the attractive long-term return potential through active management. Looking at fixed income through a sustainable lens is increasingly important to make the research informative over the long term.
Our conviction lies in the belief that DC investors who combine astute top-down sector rotation with meticulous bottom-up credit and ESG research could potentially benefit from consistent returns, robust downside protection, and low correlations to traditional market betas. By adopting this approach, they can position themselves advantageously to navigate an increasingly dynamic financial landscape.
Responsible investing has been a key theme for DC pension schemes, employers and the regulator, but can we define what value it brings and how can we measure this? This session explores different methods of accessing responsible investments in a DC pension context, why it's important to know what your and your members’ objectives are as well as how to measure progress, success and engagement with members.
Historic outperformance, characterised by strong dollar earnings, was overshadowed by stagnation leading to a lost decade for emerging markets. Investment in sustainability is developing as a new global centre of gravity. Priorities are changing: from global, concentrated, and just-in-time sources of supply to local, secure and just-in-case. Emerging markets are better funded and more self-reliant, plus the valuation discount versus developed markets is as wide as it’s been for 20 years. We believe that emerging markets can play an important role in delivering on two key objectives: capital growth and positive environmental and societal progress.
The challenges facing UK defined contribution (DC) pension schemes is clear. After the relatively stable growth and low inflation of the past four decades, schemes must now contend with high inflation, elevated interest rates and volatile public markets – all of which threaten their members’ outcomes. BlackRock believe in this new market regime, DC schemes should consider private markets – such as private equity, private credit, real estate and infrastructure.
Extending private markets access to DC members through the launch of the LTAF is a natural extension to building better, diversified and more resilient investment portfolios with the focus on helping members achieve financial wellbeing.
Join Hannah Wallis, Alternative Specialist, Melissa Ferraz, Head of Aladdin Alternatives and Claire Felgate, Head of UK & MEA Global Consultant Relations as they discuss the benefits of multi-alternative strategies, strategic asset allocation, sourcing, sustainable opportunities and risk management.
Historically access to private assets has been the domain of large institutional DB investors and while the potential benefits have been well known they have remained out of reach for most DC investors. This is now changing as DC schemes start to consider private assets, not only for the potential higher returns and diversification they can offer compared to traditional assets classes, but also for the positive impact those investments can have.
Tim Horne, Head of UK Institutional Defined Contribution at Schroders will discuss:
- How a thoughtful allocation across private assets can provide these benefits while facilitating the transition to a more sustainable future
- How they are now accessible for DC schemes
It is clear that DC schemes and their members have a growing appetite to invest in ‘sustainable’ companies. Fund managers commonly use environmental, social and governance (ESG) scores to decide which firms qualify, but these metrics can be problematic.
This session will consider the questions that we should consider in order to avoid being led astray be ESG risk scores.
For many DC schemes their equity exposure is delivered through a passive investment strategy which targets a number of sustainable characteristics such as lower carbon emissions, better ESG scores, and tilting exposure to companies whose revenues are linked to “green” endeavours. In addition, certain companies/sectors are excluded if they breach global standards and/or are within sectors that pose a future financially materially impactful scenario. Regardless of the nuances of these approaches, most of these are delivered using a passive investment approach by following indices designed to deliver these sustainable characteristics. A common challenge therefore to the managers of these strategies is the extent to which they can successfully engage with companies on the topics that many investors (including the end DC member) feel strongly about and that may pose financially material risks in the future.
During the session Caroline Silander (Head of Equity Indexation) and Kathleen Dewandeleer (Senior Sustainability Manager) will discuss how it is possible to create indices which can deliver Sustainable Outcomes, but are also able to deliver these Outcomes with an active approach to Stewardship and Engagement.
In recent years, TPR has been responsible for a multitude of aspects of the pensions industry: Regulating master trusts, focussing on improving retirement outcomes, developing guidance for protecting members from scams and fraud, and playing a key role in the development of Pensions Dashboards. Lately, TPR has also been developing the General Code, implementing change for more diversity in trusteeship, and giving guidance surrounding the gilts market following the mini budget last year. With so much going on, it's never too soon to update your knowledge, clarify your concerns and prepare for what TPR have instore for 2023.
This session will address:
- Guidance on how DC schemes can best comply with the General Code
- What can schemes do to improve diversity in trusteeship?
- Clarifying guidance surrounding the gilts market in the DC space
- What can DC schemes expect from 2023?