Fiduciary management: Adding bright sparks to your scheme.
Appointing SEI as fiduciary manager gave the trustees of the Schneider Electric pension schemes the confidence and the agility needed to guarantee member benefits. Richard Taylor, Pensions Manager at Schneider, explains the advantages.
Fiduciary management: Adding bright sparks to your scheme.
Q: What were the challenges you were looking to solve when you appointed SEI?
A: None of the trustees on our board were qualified investment professionals, so we needed to ensure they were supported by the right expertise.
Implementing changes to address underperforming funds typically took between six to 12 months in a consulting model. The aim of moving to a fiduciary manager was to be able to anticipate and respond to market events much faster.
We have three schemes, and we put the two smaller ones with SEI: the APC Pension Scheme with £25 million in assets, and the Schneider Electric Group of the Electricity Supply Pension Scheme (ESPS) with £18 million in assets. Just because they are smaller schemes doesn’t mean we don’t look after them just as much as we do with the biggest scheme.
We wanted a different voice. It’s easy to get stuck in an echo chamber hearing the same advice from the same people repeatedly. SEI offered a fresh perspective, which we valued very highly.
We didn’t want to just appoint a provider. We were looking for a partner who shares our goals.
Q: Why did you choose SEI?
We didn’t want to just appoint a provider. We were looking for a partner who shares our goals.
Some companies put their marketing or sales team forward for a tender, but we wanted to meet the people who would be doing the job and working on the account day to day.
SEI came in and opened investment opportunities that we may not have been able to pursue before.
Q: What was the onboarding process like with SEI?
A: The onboarding process for the first scheme (the APC Pension Scheme) was an absolute delight; it was so simple.
The other scheme (The Schneider Electric Group of the ESPS) was a bureaucratic nightmare due to its legacy as part of the old electricity supply pension scheme, which made it highly complex. Despite this, SEI helped where they could, and their part was easy to implement.
With SEI, we feel like we’re talking to real people, not someone who's a small cog in a big machine.
Q: What have been the benefits of having SEI as fiduciary manager?
We feel like we’re talking to real people, not someone who’s a small cog in a big machine. They’re authentic and the trustees enjoy talking to them, though, of course, we don't always give them an easy time.
It would be great if all funds increased in value all the time, but markets don’t work like that. When there is bad news, SEI has a way of delivering it, with a massive cup of optimism about how they’re going to handle it. Not everybody has that optimism and confidence, and that sets SEI apart.
We have an oversight report carried out every year, and the feedback for SEI is very positive, from the trustees and from the sponsor.
When we moved the APC scheme to SEI, it was clear from the start that it was going to move towards a buy-out further down the line. That scheme is now ready for that.
Q: Have there been any specific situations that SEI has helped you manage?
A: The obvious one was the Liz Truss mini-budget debacle. At the time, we had already appointed SEI for one of the schemes but were still in the process of moving the other. For the scheme they were already managing, SEI kept us updated with everything that was going on and protected our money. They were there to deal with everything, like the collateral calls, which gave the trustees the comfort they needed.
The fund that was not yet with SEI didn't do quite as well. To be fair, that was more due to the restrictions put on it by the sponsor, rather than the work of the previous fiduciary manager. But those restrictions are now looser, and that is partly to do with SEI’s relationship with the sponsor.
Lately, there’s been the Trump tariffs, and again we’ve had lots of communication from SEI to reassure us when there has been volatility in the market. They put a lot of thought into their communications, whereas with some managers you feel they’re just putting stuff out without thinking how their message comes across.
SEI hit the ground running with our schemes. They did what needed to be done, and they've got a great relationship with trustees and with the sponsor. It's all about authenticity.
Q: What would you say to any other scheme that was looking for a fiduciary manager?
A: Remember, you are handing over some of the responsibility for looking after investments, and so communication with the manager is key. You need someone you can talk to and trust, so you know that if there’s something that needs to be raised with the trustees, it will be. That’s what SEI does really well.
SEI hit the ground running with our schemes. They did what needed to be done, and they’ve got a great relationship with trustees and with the sponsor. It’s all about authenticity.
In their own words: Schneider Electric’s journey with SEI.
Watch the video to hear how Schneider Electric found clarity and agility in their investment strategy—and why their trustees feel future-ready.
Don Baines:
Hello, I'm Don Baines, head of SEI's fiduciary management team, and today I'm joined by Richard Taylor of Schneider Electric. Richard, thanks for joining us today.
Richard Taylor:
Thank you.
Don Baines:
Do you want to give a bit of background on your role and your responsibilities at Schneider Electric?
Richard Taylor:
Sure, so I'm a pensions manager, UK and Ireland for Schneider Electric. My responsibilities are kind of broad ranging. I'm both sponsor but also work with the trustees. Wear a lot of different hats and depending on what's going on, depends on what hat I'm wearing, but mainly it's helping the trustees and making sure they've got all the information they need and working with all of our partners.
Don Baines:
When you were looking to move across to fiduciary management, what sort of problems were you looking to solve?
Richard Taylor:
So the trustees were ordinary members of staff, so their late trustees, they didn't have the investment experience, didn't have the investment knowledge. Whenever we tried to do something when we just had an investment consultant, changing an investment fund could take six to twelve months, and by that point, the reason you're moving to those funds has changed, so you may not be benefiting from it. So the trustees decided that with after discussion with the company, that fiduciary management was the way to go just because there was more experience there, more expertise, and you guys could move a lot quicker than the trustees could ever dream of moving.
Don Baines:
With that in mind, why SEI?
Richard Taylor:
So we have a number of schemes. We have another fiduciary manager that we use, SEI was another voice in the room. It's always nice to have different opinions, different experience, different group of people to give the trustees information, and the trustees are very happy that they have those two different fiduciary managers to work with. SEI went through the full tender process, we have to do that with our company, and you came out on top.
Don Baines:
Since partnering with SEI, anything in particular that you feel has stood out?
Richard Taylor:
Honestly, it's the fact that SEI are human, there's that human touch. When you come into the room, you're not talking to SEI the company, you are talking to the individuals. So we have Harry, we have George, both of whom are absolutely fantastic. Obviously yourself, you come in and talk to the trustees as well. It's the human touch, it's the things may not have gone particularly well this month, but we have a plan, we know what we're doing, this is is the outlook. Whereas with other companies that you work with, it's more of you are talking to the company and people can't be individual, so that is one of the real, your expertise comes out, but it's the human touch that really sets you apart from everybody else.
Don Baines:
Brilliant, and I'll slip you a tenner for that comment later. So just with that in mind, over the period that you've worked with SEI, clearly there's been a few volatile moments in the market, the guild crisis, clearly the latest tariff talks. Anything that you felt SEI has really excelled in over that time?
Richard Taylor:
Keeping the trustees informed.
Don Baines:
Okay.
Richard Taylor:
Whenever there was something that you felt the trustees needed to be aware of, there was a communication that went out, whether that was in a trustee meeting, whether that was a separate email, don't worry, don't panic, everything's fine, we're monitoring everything. It's understanding that the trustees are going to have some concerns, but actually getting those answers to them before they've even raised those concerns with you, you also deal very well with the sponsor. So obviously I have both hats, but our group pensions team in Paris, you deal very well with them. So yeah, it's getting the information out before you're even asked for it that sets you apart.
Don Baines:
And finally, if you were to be giving anybody advice that is considering moving into fiduciary management, what would be the key things that they would need to think about?
Richard Taylor:
The most important thing I think is don't look for a provider. Look for a partner that shares the same goals, aims that you do. Make sure you question them. Make sure you understand who it is you're getting because the people that generally come and speak to you aren't the team that are going to be working with you. That wasn't the case with SEI. We saw the team that was working with us right from the start. Make sure that you can relate to the people that are coming out to see you. Obviously investment performance is good, you are able to show that, but it's being able to work with the trustees to understand what the trustees needs are, to understand the training that the trustees need. Honestly, I do think SEI go above and beyond there completely. Absolutely.
Don Baines:
Brilliant. Well, appreciate your time today. Thank you very much for talking to us.
Richard Taylor:
Thank you very much.
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