Edition: April/June 2019
Retirement funds must get to grips with a new set of disclosure requirements.
|Chandler . . . key terms explained|
Is the fund’s principal officer included or excluded under the definition of “management control”?
The principal officer would be seen as equivalent to the chief executive officer in a corporate.
When it comes to amounts spent on “approved training” and “member education”, what if no amounts are spent by the fund itself for these purposes e.g. where trustees and/or members attend courses offered by service providers who pay for them? Will the fund be expected to report on these and be credited/penalised accordingly?
Funds are not scored on their skills-development spend for staff or financial education of members. They simply need to disclose information on training that was provided. This could include sponsored training.
They are not penalised in any way if they do not spend. Of course, rules of the Financial Sector Conduct Authority around gratuitous support must be considered. But this is beyond the scope of the Code.
Do funds usually record the racial profiles of their members? If not, any advice on how they might cost-effectively go about creating records that separate black from non-black members and men from women?
No, funds don’t usually record such profiles. But the data is often available from employers. Again, this is merely a disclosure requirement and not something that’s scored.
On “preferential procurement”, specifically on funds’ allocations of assets for management, would only the 48 asset managers listed in the latest 27four BEE.conomics survey qualify as “black-owned”? For reference, which other surveys are available in the public domain?
There are no other surveys of which I’m aware. However, the FSC rules are based on the FSC level and not only on ownership. There are many asset managers with good broad-based statuses e.g. Level 2 or Level 3. B-B BEE is about a wide range of balanced scorecard measures.
The FSTC says that, if “sufficient disclosure” by pension funds does not materialise, then a revision of the voluntary dispensation will be considered. Some guidelines of “sufficient”? Some indications of possible revisions?
It’s too early to comment. Now that the Batseta Council of Retirement Funds is a formal part of the FSTC, it would have to agree on compulsion. Decision-making at the FSTC is by consensus.
Previous TT editions have dealt with the FSC scorecard for trustee and consumer financial education.
For practical detail, retirement funds and service providers are referred specifically to the guidance note for criteria and measurement of this aspect. The note GN500 is available on the FSTC website.