Issue: March 2005
Editorials

FIRST WORD

Today's Trustee is the monthly publication born to augment the empowerment of employee-elected retirement-fund trustees. This is its fundamental mission and its dedicated purpose.

Naturally tied in are the aims to improve financial literacy and enhance the financial skills not only of trustees but also of the fund members they represent. That they are aware of their rights, and capable of fully asserting them, is a national objective. It's central, for instance, to the Financial Sector Charter.

We're not talking here of modest ambition, or ease of achievement. By the sheer size of the retirement-fund industry, the influence it can bring to bear on corporate South Africa is potentially more formidable than any other. What it will take is for the new generation of fund trustees to realise the power they can assert, and to assert it. It is these funds, on behalf of their members, who largely own the stock-exchange-listed companies of South Africa.

Today's Trustee intends actively to promote the funds' democratisation. It will seek meaning to the intention of the 1996 amendment to the Pensions Fund Act, which paved the way for this process. The Act makes it mandatory that boards of retirement funds comprise at least four members, half of whom are to be elected by fund members.

There are over 15 000 funds supervised by the Financial Services Board (FSB), according to its latest annual report. This means that there are, or should be, at least 30 000 employee-elected trustees representing over 9,5 million members with combined assets of some R835,5 billion.

By the sheer size of the retirement-fund industry, the influence it can bring to bear on corporate South Africa is potentially more formidable than any other



There are also the official Transnet and Telkom funds, which aren't registered with the FSB. On top of them is the largest of all, the state's Public Investment Commissioners, with another R380 billion under its belt. Together, the funds hold more than R1,3 trillion of national savings for over 10 million members.

All have pivotal roles in the transformation of South Africa's socioeconomic landscape, in the rise to prominence of corporate governance and in the attention to socially-responsible investment. At the same time, within the constraint of care, they retain the fundamental duty to maximise returns for their members to whom they must be accountable.

To fulfil their roles effectively, three basics are needed: first, adequate education and training for the new trustees to exercise due skill and diligence in the execution of their trust obligations; second, relevant reportage and commentary that helps stimulate their debate and inform their decisions; third, a forum for fund managers and trustees to communicate with one another in the public gaze of fund members.

The task for Today's Trustee is to assist in the building of these pillars. It will strive to do so through language and presentation which is friendly to its target market, and by the selection of content intended to be useful for it. The challenge is in being able to serve the employee-elected trustees, constantly monitoring their requirements, as well they might reasonably hope.

By its commitment to advance a national imperative may this publication be judged.

Allan Greenblo
Editorial Director