TPR’s EDI plans and what they mean for trustee boards

The Pensions Regulator (TPR) has published its Equality, Diversity and Inclusion (ED&I) Strategy.

In addition to setting out how TPR intends to embed an inclusive culture within its workplace, the Strategy also covers how it will work with governing bodies of workplace pension schemes, such as trustees, to help them become more diverse and inclusive in their decision-making.

The Strategy covers TPR’s three aims in this area for the period to 2025, with two out of the three prospectively affecting occupational pension schemes and the composition of the governing bodies that look after them:

1. To be a fair, diverse and inclusive employer
2. To build a collective understanding of why pensions inequalities occur and, within TPR’s regulatory remit, work in partnership with others seeking to reduce them
3. To promote high standards of diversity and inclusion among TPR’s regulated community.

ED&I and TPR

According to the foreword to the Strategy, written by TPR’s CEO, Charles Counsell:

“As an employer, we need to do more, not only to attract diverse talent but to keep people when they join us. We need to really challenge ourselves about why we are not diverse enough in the senior levels of our organisation and ask what we can do as a community to help all our people feel safe and supported at work. We want to influence and drive change across the pensions industry and to do that we need to take an honest look at ourselves as an employer and address those areas where we must do more”.

The Strategy then describes the current composition of the workforce at TPR and includes a commitment for “continuous scrutiny of our culture and practices so we can improve them”. Areas where room for improvement has been identified are: women in technological and specialist roles; pay gaps for people from ethnic minority backgrounds and LGBO+ employees; increasing ethnic minority and LGBT+ representation across the executive and senior leadership teams; and improving the position of disabled people and those with health conditions who work at TPR.

The steps TPR is taking to achieve its ambitions, including some specific objectives, are described in the Strategy, which also states that TPR will:

“embed diversity and inclusion within our people, regulatory and operational practices by 2025, and the suite of KPIs we develop will enable us to measure our success”.

ED&I and trustees

By way of context, the introduction of automatic enrolment has seen a dramatic change in the pensions industry. It has meant more people, including more women, more people from ethnic minority backgrounds, more young people, more disabled people, and more people on low incomes, are saving into pension schemes. However, there is still a lack of diversity in the composition of trustee boards.

So, against a backdrop of putting the saver at the heart of all that they do, TPR will undertake a ‘deep dive’ into the evidence base around the relationship between EDI and decision-making, and explore options for a forum with the regulated community where best practice can be shared.

The Strategy includes a road map for the period 2021 to 2025 and the success measures include:

1. by the end of 2021, TPR will co-create a strategy with representatives from the regulated community, which will support and set targets for the development of more diverse and inclusive boards of trustees/managers; and
2. this plan will also agree how to share resources and best practice in the long term, for example via a ‘hub’.

Trustees should keep abreast of these developments, with a particular focus on the targets for more D&I on trustee boards.