Schemes struggle to get through to members, but members don’t find it much easier to get through to schemes
“It’s so hard to engage members with their pensions”, is a lament you hear at every pensions industry conference. And the younger the member, the harder it apparently is to grab their attention.
Given the trouble we’ll soon find ourselves in if people don’t start saving more for retirement, this lack of member engagement is a serious concern.
But the Pension Power Parliament organised by ShareAction last week turned this complaint on its head. Pension Power is a campaign the charity runs to help give individual scheme members and policy holders a say in how their money is invested.
At last week’s event, hosted in Parliament, saver after saver of every age stood up to share their stories of how this engagement was going for them. Their tales were both inspiring and dispiriting.
Inspiring, because they could point to real progress – individual members or groups of members reported many successes in getting there scheme or provider to listen to their concerns about governance, representation and responsible investment.
But dispiriting because in most cases the process was so hard. Members were not asking for the earth – just information about how their money was invested, or a say in how their scheme was run.
They generally found it very difficult to engage with their scheme. There were a few notable exceptions: Royal London won applause for being the first group personal pension provider to include a member on its independent governance panel, and L&G was praised for holding its first annual member meeting last month.
But generally, the first response to member interest was to stonewall. Schemes of all kinds – GPPs, mastertrusts, single-employer trusts, local government schemes – that I think of as being well-run either ignored or fobbed off members that were deeply interested in their pension schemes.
The most depressing story of the evening came from a group of MPs who have been probing trustees of their own pension scheme about its exposure to climate change risk. So far their trustees have declined to even meet them.
It would be unsurprising if all of these investors looked for alternatives to saving into a pension. This is their money, and they want some kind of control in how it is used.
Engagement is a two-way process, and the more pension schemes listen to their members, the more likely it is that their members will listen to them.