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Clear purpose and strategy

Develop and regularly review your pension scheme’s business plan. This will help you to manage your scheme effectively and get good outcomes for members.

Your business plan should help you to set a clear strategy and inform all that your board does.

Use your business plan

Setting a clear purpose and strategy is essential to managing your scheme effectively and getting good outcomes for members.

Having a business plan will enable you to plan ahead and improve your ability to comply with legal requirements at all times. Use your business plan to help you to:

  • set out strategic goals for your scheme
  • check your progress using short-term and medium-term objectives
  • take action effectively if objectives are not being met
  • prioritise scheme business and board agenda items
  • plan training and other activities to develop the skills of the board
  • co-ordinate activities of advisers and those providing services to your scheme
  • engage with employers
  • manage risks effectively

Your scheme’s business plan should cover:

  • clear, long-term goals for your scheme and interim objectives around key areas of focus including governance, investments (and funding for defined benefit schemes), administration and communications
  • how you propose to meet these objectives and goals
  • how you will measure and monitor progress towards them

Download a sample business plan (PDF, 141kb, 8 pages).

If you need to produce a more detailed plan, download a sample annual planner (XLSX, 22kb) for your scheme.

Governance examples 

Poor behaviour

Failing to plan

The scheme does not have a business plan to manage activities. Items are brought to the trustees’ attention by the scheme’s advisers or when the trustees have to make decisions.

Urgent business dominates meeting agendas and the trustees are unable to make time for strategic discussions. The trustees do not prepare for an upcoming regulatory change and end up missing a legal duty. The Pensions Regulator issues a penalty for non-compliance.

Without clear long-term goals or interim objectives the board is failing to govern the scheme effectively. Failure to comply with basic legal duties can be a sign of broader governance problems.

Good behaviour

Keep a forward look

The trustees keep a 12-month forward look of key legal changes, required activities and events coming up for the scheme. The trustees consider the plan at each board meeting, evaluate progress and update the plan. It provides the trustees with a clear and reliable way of planning scheme business.

The business plan shows what to cover at each point in the scheme cycle as well as reactive issues such as regulatory change that may arise. The board organises training based on these key activities and scheme events. For example, they receive investment training so they are ready to review the investment strategy.

Think strategically

The board has an annual strategy meeting and the trustees consider the scheme’s business plan. Evaluating progress against the scheme’s goals, they review the short-term and medium-term objectives and agree how these will be monitored.

The trustees consider the priorities in the plan and decide to delegate certain items to the scheme’s administrator. This frees up the trustees’ time and enables the board to take more of a strategic, proactive approach.

If less time is available, trustees allocate time in trustee meetings to focus on strategic issues.

Collaborate with sponsoring employers

The trustees discuss long-term plans and objectives with the sponsoring employer. The sponsor considers the investment performance is not good enough with too much volatility for the company balance sheet. They want to reduce the level of investment risk.

The trustee board carries out a review and sets out options, considering the scheme’s long-term journey plan. Developing a collaborative relationship allows the trustees and sponsor to understand and work towards the long-term goals for the scheme.

Check your governance: purpose and strategy

  • Does your scheme have a business plan that includes strategic goals and interim objectives?
  • Do you monitor progress against the objectives in your scheme business plan?
  • Do you review your scheme’s business plan and objectives regularly?

Trustee Toolkit online learning 

You can increase your trustee knowledge and understanding using our Trustee Toolkit. You must log in or sign up to use it.

Go to the Trustee Toolkit