Devils Advocates Panel – Morning Session
David Hare, Chair of the Independent Governance Committee, Phoenix Life
Barry Parr, Independent Trustee, Carey Master Trust
08:00 – 09:00
Registration and Networking Breakfast
09:00 – 09:10
Welcome and Opening Remarks
DC Strategic Summit
09:10 – 09:35
Presentation: Mapping the DC Landscape
The DC sector is far more complex than other parts of the pensions system. There are multiple practitioners involved, many of whose roles are poorly understood even by those actively involved in DC pensions. DG Publishing has teamed up with Quietroom to create a ‘Map’ of the DC landscape, depicting the various organisations involved in DC pensions and the roles they play. It is intended that the map will enable all stakeholders to explain this system to clients, colleagues, business counterparties, suppliers, trustees, investors, members, regulators, you name it – all those whom you serve or on whom you depend – in a clear, intelligible way, and in turn bring numerous benefits and efficiencies to your businesses and organisations. In this session, we will present the results of our work, and engage with delegates on how to develop this initiative further.
09:35 – 10:15
Panel: Competing Delivery Models – What’s Best for Members?
Capital Cranfield Trustees
Is it best to be governed by a single trust, a master trust or an IGC? Should provision be bundled or unbundled? How do you compare the merits of the numerous DC investment platforms? How do costs and benefits stack up for all of these alternatives? These are just some of the choices and challenges that even experienced practitioners – let alone lay members – find confusing and difficult. Our panellists will seek to demystify the competing delivery models for DC pensions savings and to point towards a methodology to assess them more efficiently.
10:15 – 10:35
Presentation: The Evolving Role of Multi-Asset Strategies in DC Default Funds
Global Multi-Asset Portfolio Manager
Default funds must accomplish a very great deal. When you consider that over 90 percent of auto-enrolled DC members are invested in a default fund, and that in future most workers will depend on their DC savings for a wage in retirement, that amounts to a lot of heavy lifting. The mix of investments within a default fund is therefore critical. Our speaker will explore how multi-asset strategies are evolving to deliver the combination of performance and stability necessary to optimise retirement outcomes for a large number of members.
10:35 – 11:05
Panel: Making the Most of the Charge Cap
DC Policy Manager
Department for Work and Pensions
The great majority of DC scheme members are invested in a default fund, currently with a maximum cap of 75 basis points for the total costs of running the scheme under auto-enrolment. This raises the dominant question on how to deploy that charge cap most effectively to achieve optimal member outcomes. Currently, costs for running the average scheme are not much above 50 basis points, strongly suggesting that DC providers are more concerned with prudence than performance. Meantime, many managers are reluctant to compete in the DC market because of the lower average fees. The panel will discuss whether there is an opportunity missed on both sides, and which combination of both passive and active investment strategies can be deployed to make optimum use of the charge cap.
11:05 – 11:30
11:30 – 11:50
Presentation: ESG – No Longer Just a “Nice to have”
Global Head of Sustainable Investment
J.P. Morgan Investment Management
ESG has come a long way. With better data and approaches to assessing financial materiality, defined contribution executives should carefully examine the incorporation of material ESG information as part of their DC portfolio planning. Our speaker will discuss the latest trends in ESG integration and especially their implications for investment strategy as well as manager selection and retention. She will also address the increasing interest from savers for dedicated sustainable investing strategies in DC pension portfolios and how best to structure a balanced portfolio to meet their needs.
11:50 – 12:30
Panel: Making Sense of Multiple Approaches to ESG
Fund Manager – Global Equities
Jupiter Asset Management
Building on the ideas in the preceding presentation, panellists will explore various approaches to sustainable investing within DC portfolios and the merits of each. They will discuss the challenges of incorporating ESG into various asset classes, and the extent to which DC managers need to become active stakeholders in the companies in which they invest.
12:30 – 12:50
Presentation: The Tipping Point for Scale in DC Pension Schemes
Senior Portfolio Manager, Multi-Asset Solutions EMEA
The DC occupational pensions landscape continues to evolve toward greater consolidation and fewer schemes, all in the name of scale and the benefits that size can bring. Our speaker will explore the other side of this coin, especially the trade-offs for individual employer schemes and the potential detriment to member outcomes. What is the prudent level of scale and what is the scope to achieve a better balance for providers, employers and members in a post-consolidation world? He will make the case for custom defaults and how this can be achieved efficiently.
12:50 – 14:00
Devils Advocates Panel – Afternoon Session
Claire McCormick, Board Trustee, Clydesdale & Yorkshire Banking Group
14.00 – 14.40
Panel: Measuring Value for money – What’s the best Approach?
RBS & Heineken DC Schemes
Chief Executive Officer
Independent Governance Committees are mandated, among other things, to assess value for money of the schemes they supervise. But there is more than one school of thought on how best to do this. In particular, some practitioners believe that VFM can be expressed in a single number, enabling great efficiency of comparison and empowering members to take control of their pensions decisions, while others hold to the idea that VFM is far more complex and that this approach is oversimplified and misleading. Our Moderator will stage a debate between speakers representing these two competing views.
14.40 – 15.00
Presentation: How the Young Could Transform DC Pensions
In future, most people will retire on a DC pension. Many of those future retirees are currently young people. Under the pensions freedoms they are being invited, as never before, to take charge of their pension savings and make critical decisions on how these savings are invested and ultimately drawn down. Our speaker will examine how the young are engaging with pensions issues, the choices they are facing, the key drivers behind their decision making, and how this will affect the design and delivery of DC pensions vehicles.
15.00 – 15.40
Panel: The Best Bang for Your Buck – Incorporating Illiquids
Head of Portfolio Research & Consulting Group
Natixis Investment Managers
Chief Investment Officer
HSBC Pension Scheme
One of the great challenges in DC pensions is that of incorporating illiquid investments to any significant degree in the asset mix. Some argue that it simply cannot be done effectively because of the daily pricing constraint. Others say differently, and certainly from a philosophical point of view a pension plan that is not going to be drawn down for many years should be able to access long term risk premia, including illiquids. Our speakers will discuss the practicalities of these issues.
15.40 – 16.00
Presentation: Dashboards & Statements – Keeping Track of Everything
The intention of the Pensions Dashboard is to permit members to get a clear view of all their pensions savings in the same place at the same time. Similarly the Pensions Statement aims to give members an annual reality check on where their pension stands and what has changed over the preceding year. Our speaker will discuss the status of these initiatives and the effect they will have on members’ choices for their future savings plans.
16.00 – 16.30
16:30 – 16:50
Presentation: To be advised
16.50 – 17.30
Panel: What Happens At Retirement?
Tesco Pension Scheme
A significant criticism of DC schemes is that they are not really a pension, rather a tax-efficient savings scheme. At the point of retirement, members have critical choices to make about how they draw down their DC savings – whether they do indeed convert them into a wage for life (i.e. a pension), cash them in entirely, or choose some solution in between. What is certain is that the great majority of DC members will be reliant upon their DC pot(s) for their retirement income, and that many of them will be ill-equipped to make the optimal choices on their own. The panel will discuss the products and strategies that are being developed by the industry to assist members with this critical decision.
17.30 – 17:35
17.35 – 18.45
Drinks Reception at County Hall
Dinner at Sticky Mango Restaurant
A partnership between celebrated Chef Peter Lloyd and Restaurateur & Wine connoisseur Nigel Wilkinson, Sticky Mango has taken residency at RSJ restaurant on the corner of Coin Street and Stamford Street in between Waterloo and London’s Southbank. The restaurant offers guests a relaxed dining experience, sharing the wonderful flavours of Lloyd’s creations paired with carefully selected Loire Valley wines from Wilkinson. We will provide a coach to take delegates the short journey to Sticky Mango following the Drinks Reception.