Building Better Pension Boards: How Should You Engage Your Trustees?

At the Canadian Leadership Congress, we’re all about starting conversations that matter to Canada’s pension leaders—our virtual Challenge of Change event was no exception.

Before the conference, we reached out to Canadian pension fund CEOs and CIOs to provide their questions on the main themes covered during our two-day event, including governance and leadership.

We then fielded questions from our delegates in order to get them the answers they need to address their challenges.

Following our panel discussion on the theme of pension plan governance, featuring Marlene Puffer (president and CEO of CN Investment Division), Deborah Leckman (member of the OPTrust board of trustees), and Christie Stephenson (executive director of the Peter P. Dhillon Centre for Business Ethics at UBC Sauder School of Business)—we presented the following governance-related question from one prominent Canadian pension CEO.

“When it comes to pension board composition, management is often working with trustees that bring competing perspectives/interests and understanding of investments to the table (I.e. unions vs expert board members, lay board members). Please share practical tips for pension management teams balancing the need to engage such trustees and yet maintain the long term health of the plan?” Canadian DB pension CEO – repetitive?

Our pension CEO received lots of suggestions from our group of leaders—below are just a few of the highlights:

Appeal to common sense always.

Everyone should take off their respective hats before they come in. Every investment committee agenda item that requires a decision, has to have an education component—can be optional. We have a retreat every year for our trustees and sponsors to get to know one another better and their perspectives.

Lots of time for social interaction. This has helped build a strong culture on our board that new members coming in really learn quickly. Insist on civility and respect—but entertain competing thoughts and priorities with reasonable time management—because those discussions/debates can lead to new or better results, and are, at the very least, educational.

Seems simple but, get to know them, their families, beliefs, interests, etc. This takes time, but will help lead to better collaboration and outcomes.

Have conversations with individual trustees outside the board room, informally at the breaks during board meetings, or if that isn’t possible, then with the Chair’s input to ensure they are onside.

Check in at least once a year with each committee member individually to see if there are any questions they may have that they may feel uncomfortable asking in the boardroom setting, or any topics they may feel should be addressed that perhaps the chair is not aware of.