Aon Hewitt has developed a series of 10 questions for pension trustees to use to make sure they’re getting the most out of their relationships with advisors.

Applicable to both defined benefit and defined contribution plans, the questions are part of an effort to create tools trustees can use to perform their responsibilities with greater confidence, according to a press release.

“When talking with trustees, we often hear that when they meet with their advisors, they might not feel in a position to ask challenging questions on every topic presented. For this reason, we have developed a set of questions for trustees so they can challenge the advice they are given,” said Susan Hoare, principal at Aon Hewitt. “These are less about querying the technical detail of what they are told but more about using superior questioning techniques to provide them with the information to make an informed decision.”

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In helping understand decisions from their advisors, trustees should ask: What’s the rationale for the recommendation, and how would someone articulate the decision to all stakeholders?

In testing the decision and its possible alternatives, trustees should ask: Are there simpler or cheaper alternatives that deliver similar outcomes?

Trustees can also play devil’s advocate by asking: What are the consequences of not making a decision now, in the next quarter or next year? And if everything has gone wrong in 12 months’ time, what are the possible causes?

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When trustees are trying to gain more perspective on lengthy strategies, they should ask: How does the decision fit with the long-term plan? And what might the decision prevent them from doing now or in the future?

Finally, trustees should ask: How do they measure the success of the decision and by when?

The research took the opinions of more than 120 pension trustees into account and asked them what they feel are the most important aspects of their roles, with particular regard to the quick decision-making they often undertake.

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Staff is regional vice-president, sales — specialty programs at Empire Life. These are the views of the author and not necessarily those of Benefits Canada or Empire Life.
Copyright © 2021 Transcontinental Media G.P. This article first appeared in Benefits Canada.

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