Minimising risk through a structured process
Integrated Risk Management
How we can help
Trustees of defined benefit schemes have an obligation, under the guidance of The Pensions Regulator, to examine the interaction between three component risks:
- Employer covenant
The objective of an Integrated Risk Management program is to manage and mitigate the risks inherent in defined benefit schemes.
Our experienced and qualified team can take a close look at how each of these components align, prior to recommending an Integrated Risk Management framework and implementing any potential contingency plans that may need to be established.
Pensions Governance services
Many trustees have had their fingers burnt in underestimating the value of good governance and yet, it is a critical factor in determining the funds’ success. We will advise and help you adhere to every aspect of governance, ensuring that the rewards from having a good pension scheme in place are realised.
Our 5 Step framework which can be accommodated by most schemes
Step 1: Planning
- Determine the scheme and employer’s objectives
- Agree a relevant proportionate approach
Step 2: Risk Identification and Assessment
- Identify funding, investment and covenant risks
- Assess the impact and interaction between each risk
- Assess the employer’s ability to support the scheme and capacity of risk in comparison to that of the trustees
Step 3: Risk Management and Contingency Planning
- Assess the current position and determine whether the employer and trustees are comfortable or whether changes are required
- Understand how the employer covenant may impact on the investment and funding strategies, and develop contingency plans should strategies need to be revised
Step 4: Document the Framework and Decisions
- We bring clarity and assist with ongoing monitoring and core efficient decision making, with a focus on the main decision points
Step 5: Cyclical Risk Monitoring
- The framework doesn’t finish at this point! High level monitoring is carried out at least twice a year to periodically reappraise, respond quickly to emerging risks, and implement further action plans