TPR diversity survey finds trustee chairs are key drivers of change
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Trustee chairs are the drivers behind how a board sees diversity and inclusion and whether it takes any action, the Pensions Regulator has found. Its first diversity and inclusion survey also shows pension trustees are significantly less diverse than the UK population and fewer than half of schemes have improved.
The regulator’s trustee D&I survey, conducted in summer 2023 among 2,197 trustees and public service scheme pension board members, shows the typical trustee is “a white man who is over 45”.
Louise Davey, TPR’s interim director of regulatory policy, analysis and advice, said: “While the profile of the ‘typical’ trustee is unlikely to be a surprise, this survey has supplied important baseline data we can use to measure progress towards more diverse and inclusive scheme boards.”
She added: “It also shows the majority of trustees recognise the importance of greater board inclusivity and diversity, although fewer than half of schemes have taken action to improve.”
Davey said TPR wants trustees “to think about diversity more widely than just through more visible characteristics and consider their boards’ skills, life experience and cognitive diversity as well.”
A year ago, TPR published guidance for pension funds and employers to help them improve equality, diversity and inclusion.
The primary predictor of whether a trustee board views diversity as important is whether there is a chair who drives and promotes D&I, TPR said, adding that for taking action, the two most important predictors were the size of the scheme and, again, having a chair that drives and promotes D&I.
Trustees see boards as diverse
Despite the current lack of diversity, 78% of respondents said they think diversity on a trustee board is important for good governance among others, though, perhaps unsurprisingly, it also found women and newer trustees had a more positive attitude towards D&I.
TPR said the results of its largest ever survey will “provide a baseline to measure progress towards ensuring high standards of diversity and inclusion on pension boards”.
The survey showed a clear lack of diversity in terms of protected characteristics and visible attributes, with more than half (53%) of trustees falling into all seven categories of being male, having the gender identity they were assigned at birth, being heterosexual, white, over 45, able-bodied and either of Christian faith or having no religion.
In comparison with the UK census, trustees are markedly less likely to include people under 45, people with disabilities, women and those of faiths other than a Christian faith or non-religious people.
Despite the evident lack of representation of some life experiences that would probably be associated with some or all of these characteristics, respondents said most trustee boards were diverse in terms of skills (82%), life experience (74%), professional background (73%), cognitive diversity (73%) and education (61%).
Fewer than half of schemes are taking action
Despite trustees’ seeming belief in the importance of diversity and inclusion, fewer than half (43%) of schemes had taken or were planning to take action to create a more diverse trustee board or to encourage greater inclusivity among trustees. Only 22% collected data on the diversity of their trustees in terms of protected characteristics, typically only covering gender and age.
Chairs are key drivers of D&I, according to the survey, and professional trustees are more likely to drive action. It found professional and corporate trustees were associated with greater action on diversity and inclusion, and half of trustees felt the board’s chair played a key role in driving and promoting in D&I.
Why do trustees say diversity and inclusion is important but fail to take action?
