IORP II vs ESoG: Navigating Pension Legislation with Expert Support

A Roadmap through Pension Legislation

Navigating the complexities of pension legislation can feel like going through a maze, but with the right support and expertise, it becomes a manageable journey. My experience with implementing IROP II legislation for an Irish scheme has provided invaluable insights into the intricacies of pension governance. While the prospect of implementing the Effective System of Governance for a UK scheme may seem daunting, I am confident in my ability to rise to the challenge, especially with the support of the dedicated team at Dalriada.

On the 18^th November 2021 the Irish Pension Authority released the much-anticipated Code of Practice for trustees, ushering in a new era of governance standards. While some may view the extensive guidelines as burdensome, I see them as a necessary step towards ensuring robust governance practices. Similarly, the upcoming General Code of Practice for UK schemes presents both challenges and opportunities for enhancement. As trustees and scheme secretaries, we must move beyond mere compliance and strive for a governance framework that is tailored to the unique needs and circumstances of each scheme.

Nuanced Governance Approaches: Contrasting Irish and UK Codes

One of the key differences between the Irish and UK codes lies in their approach to governance. While the Irish code mandates specific actions, the UK code emphasises proportionality, recognising that one size does not fit all in the realm of pension governance. This shift requires trustees to adopt a nuanced approach, evaluating the size, nature, and complexity of their scheme’s activities to determine the most appropriate governance measures.

Implementing an effective system of governance shouldn’t be a series of boxes to be checked. A governing body must be actively engaged in its system of governance in order for it to be genuinely effective. Trustees must provide justification for their decisions regarding how to proceed and whether or not to impose controls on specific activities. And be ready to adjust the governance structure, for instance, if the plan moves toward a buy-out and its operations alter.

At Dalriada, we understand the importance of effective governance and offer tailored solutions to help trustees navigate these complexities. Our team-based approach ensures continuity of service and expertise, allowing trustees to focus on strategic decision-making rather than administrative burdens. With our support, trustees can confidently navigate the evolving landscape of pension governance, secure in the knowledge that they are well-equipped to meet regulatory requirements and deliver optimal outcomes for their members.

Want to know more?

To discover more about how we can assist you in navigating the complexities of pension legislation and implementing effective governance frameworks tailored to your scheme’s needs, explore our Pensions Management service or contact Emma Roberts.