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Why have a pension scheme diversity & inclusion policy?
16 July 2021

Why have a pension scheme diversity & inclusion policy?

In an ideal world, all of our differences would be equally celebrated and we would not need specific laws to protect an identified group, or awards based on sex, age or colour. Before we get to this utopian ideal, how can having a Diversity & Inclusion policy for your pension scheme help improve fairness?

Introducing a Diversity and Inclusion (D&I) policy provides an opportunity to assess current practices and to identify what could be improved in order to achieve your scheme’s D&I vision. The process of agreeing the vision and goals are an important part of the process. You consider which goals can be made SMART (specific, measurable, achievable, realistic and time-bound) and which are better as broad visions. Noting a SMART objective often narrows the goal, so you may prefer the visionary version for some or all aspects. We recommend you consider the trustee policy alongside any corporate policy, as the sponsor may be keen for the trustee board to be managing D&I issues consistently.

Some actions were highlighted in the SMART goals but there are also other actions which can support the D&I policy.

A few examples include:

  • Unconscious bias Unconscious biases exist and it is important that these are recognised, and trustees are not thoughtlessly led by them when making decisions. This issue can be tackled by asking questions and considering counterfactual views, e.g. when considering an ill-health retirement for a mental health condition; challenge with a counter-factual example like what if it was a bad back.
  • Diversity in trustee appointment By advertising vacancies with an emphasis on a willingness to learn and outlining the development support available for trustees, this will help to encourage a wider pool of candidates. This can assist in creating a board that encompasses cognitive, characteristic and experience diversity. Ensuring that the individuals who apply are aware that the board receives regular training and development support, as well as being encouraged to be a part of all discussions, should create an inclusive environment.
If we put the work in, we can strive towards an ideal world.

To read more on D&I in investment strategy read the March Pensions Aspects article here.

Notes/Sources

This article was featured in Pensions Aspects magazine July/Aug edition.

back to Pensions Aspects Magazine

Last update: 16 July 2021

Amy Bloomfield
Amy Bloomfield
Aon
Associate Consultant
Lynda Whitney
Lynda Whitney
Aon
Partner

Application Consultant

Salary: £20000 - £35000 pa

Location: South Birmingham

In-House Pensions Manager, Trustee Executive

Salary: £60000 - £80000 pa

Location: London

In-House DC Pensions & Benefits Manager

Salary: £60000 - £80000 pa

Location: London

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