Issue: November/December 2005
Old Mutual Corporate

Fewer headaches, more accountability.

See how a good umbrella fund can measure up for your company. You owe it to your members!

Hugh Hacking, Evergreen marketing manager at Old Mutual There are increasing demands on the financial services industry to provide transparent, simple and cost effective products. Hugh Hacking, Evergreen marketing manager at Old Mutual discusses the benefits of modern umbrella funds.

The provision of adequate retirement benefits by employers for employees is also under scrutiny. Government is reviewing the Pension Funds Act, which will almost certainly lay down far stricter requirements for pension fund governance, responsibility and accountability of trustees, communication and education of fund members.

This places a heavy burden on employers with smaller, self-managed pension funds who may not have the resources and economies of scale to meet these requirements.

Umbrella pension funds, as opposed to self-managed or standalone funds, are retirement funds to which multiple employers can belong. They are ideal for employers with diverse workforces. Smaller employers simply plug into an existing administration and management platform.

The law demands a minimum level of communication including basic member information, annual member benefit statements and new member certificates. Evergreen constantly seeks to exceed these minima, and provides members with enhanced communication, such as:

  • A guide pack with general retirement information to assist
  • members with decision-making;
  • Induction seminars;
  • Quarterly newsletters;
  • Education seminars; and
  • Access to a secure internet site showing investment fund and member portfolio details.

At Evergreen the majority of trustees are independent of Old Mutual. The trustees are appointed for three years. Each year, an independent trustee is elected chairman of the management board. A principal officer, also independent of Old Mutual and other service providers, assists the board.

To enhance transparency and good governance, an Evergreen trustee must sign an Acceptance of Trust document and a Code of Conduct statement. These demonstrate that trustees are committed to fulfilling their fiduciary duties, to act in the interests of the funds and their members, to disclose conflicts of interest, and to place the interests of the funds and members above their own.

Not only are company managements relieved from the increasing administrative and regulatory burdens, but employees have peace of mind that their nest eggs are in safe hands.

The economies of scale that a large financial services company such as Old Mutual is able to achieve also help insures that returns are not diminished by spiralling costs.

For more information, you’re invited to contact Hugh Hacking on (021) 509-4489 or