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In simple terms, governance is the act of overseeing the control and direction of something.

For the SEI Master Trust it means our Trustee exercises its powers to act in the best interests of all members at every stage of their retirement journey. This includes the basics, like making sure money is being received, invested and paid out to members quickly, efficiently and in line with regulations.

It also means keeping them informed of the key decisions they need to take at key stages and providing value for the members throughout. 

Providing ‘value’ for members is not just a goal but a guiding principle that drives the many moving parts of 21st century pension governance.

How does our governance support members of the SEI Master Trust?

Investing dispassionately: tailoring to suit your scheme

Default investment strategies are hugely important for the majority of members who don’t want to make their own investment choices.

The default drawback, for most, is that it tends to resemble minor variations of a model that has been in place for decades. In short, investing in stocks and shares before switching into less-risky bonds and cash ten years away from retirement, regardless of the composition, character or retirement plans of the scheme membership.

Many defaults don’t allow members to continue to de-risk through retirement. That can mean placing members in static investment allocations of bonds and lower-yielding investments at age 65, despite still needing to generate return for another 20-30 years whilst providing sufficient income throughout that will last at least as long as they do. Perhaps even worse are those that force members to transfer out completely to another product and default at retirement, exposing them to additional market risks from which their retirement savings might never recover.

We think that’s unacceptable.

So we design default investment options with an appropriate blend of active, factor based, and passive investments. They have identifiable objectives that give members the best chance of attaining their retirement goals and align with an appropriate risk and longevity profile. If there’s too little risk, their money may run out just when they need it the most. Too much risk and short-term volatility can increase the chances of members switching to lower risk investments when the markets are at their lowest. So we continually monitor and adapt the investment on their behalves, taking them to and through retirement without any need to transfer out. At all times they will still have the option to come out of the default and choose their own investments, or for their advisers to help do that for them. 

Governance at the highest level: tackling trustee challenges

Trustees overseeing DC schemes strive to do the right thing on behalf of their members despite an ever-increasing volume of regulation.

Most want to address this added weight of responsibility but can lack the resources, support, and time to do so.

And while some employers may still choose a Group Personal Pension Plan and place their scheme under contract with an insurer, the lack of Trustee oversight often means they feel the need to establish their own governance committee, with the many obligations this brings, to maintain some form of oversight.

Clearly, a master trust can offer more than just reduced costs through economies of scale. It can appoint industry specialists to take on certain tasks, leaving the main trustee board with time and space to focus on delivering the best possible service and outcomes to members.

This ability to enable the trustee to focus primarily on those aspects of governance that most directly benefit member outcomes, whilst appointing certain aspects of the Trust’s development to market leading independent specialists in technology, engagement and investments is yet another advantage of the master trust’s depth of resources.

 

This is a marketing communication.

Speak to an expert today:

DC Director, UK Institutional Group

DC and Sol utions Managing Director, Institutional Group EMEA and Asia

Defined Contribution Director, UK Institutional Group

Important information

This webpage has been created in relation to the SEI Master Trust, an occupational pension scheme which is authorised by the Pensions Regulator. This information is issued and approved by SEI Investments (Europe) Ltd (“SIEL”) 1st Floor, Alphabeta, 14-18 Finsbury Square, London EC2A 1BR. This advert and its contents are directed at persons who have been categorised by SIEL as a Professional Client and is not for further distribution. SIEL is authorised and regulated by the Financial Conduct Authority. While considerable care has been taken to ensure the information contained within this webpage is accurate and up-to-date and complies with relevant legislation and regulations, no warranty is given and no representation is made as to the accuracy or completeness of any information and no liability is accepted for any errors or omissions in such information or any action taken on the basis of this information. The information in this webpage is for general information purposes only and does not constitute investment advice. You should read all the investment information and details on the funds before making investment choices. Please refer to our latest Prospectus (which includes information in relation to the use of derivatives and the risks associated with the use of derivative instruments), Key Investor Information Document, Summary of UCITS Shareholder rights (which includes a summary of the rights that shareholders of our funds have) and the latest Annual or Semi-Annual Reports for more information on our funds, which can be located at Fund Documents (https://seic.com/en-gb/fund-documents). And you should read the terms and conditions contained in the Prospectus (including the risk factors) before making any investment decision. The UCITS may be de-registered for sale in an EEA jurisdiction in accordance with the provisions of the UCITS Directive. If you are in any doubt about whether or how to invest, you should seek independent advice before making any decisions. Investment in the range of the SEI Master Trust’s funds are intended as long-term investments. The value of an investment and any income from it can go down as well as up. Investors may not get back the original amount invested. This document and its contents are for Institutional Investors only and not for further distribution.