Communication with members is important to get right and, with TPR's recently published governance survey identifying communication as an area for improvement, there is now renewed impetus to step up a level. The onset of automatic enrolment also provides a valuable opportunity to improve existing strategies.
As part of our ongoing series of newsletters focusing on topical scheme governance issues, this newsletter looks at the key elements of an effective communications strategy.
In this Alert:
All parties have an interest in ensuring members are engaged with their pension arrangements and, in particular, that employees recognise and value the benefits available to them. It can also offer a valuable opportunity to showcase trustees' governance work and its benefits.
Both employers and trustees have legal duties to provide employees and scheme members with information regarding their pension arrangements. For trustees, these duties are found mainly in the Disclosure Regulations1
. But with auto-enrolment on the horizon, employers have new legal obligations in this arena2
First, break your target audience into categories. Think about factors such as:
- How financially educated are they? This will drive how much technical detail you include.
- Is the audience familiar with pensions / their retirement options? It is important – but often tricky – to use plain language and avoid jargon.
- Are members nearing retirement? Members early in their careers may need a message focusing on the need to plan for the future, differing markedly from those closer to retirement.
Technology continues to offer new alternatives to the traditional method of communicating by post. But you still need to think about compliance, all member cohorts and record-keeping.
Since December 2010, changes made to the Disclosure Regulations have opened up the use of electronic disclosure. Members must be given written notice before trustees issue electronic communications for the first time and must also be given the option of requesting a hard copy. Trustees must also specifically draw members’ attention to information posted on a website. Employers may also comply with their auto-enrolment disclosure duties by communicating by email with workers, but cannot simply post information on an intranet or website.
Ever changing technology means that members across all ages may now use smartphones or tablets, and this can be a great way to engage them. Electronic platforms can be interactive, easy to update and maintain, and provide members with the opportunity to model their own circumstances. They can work particularly well for a mobile workforce, ensuring time critical communications are received.
But the use of smartphones and the like needs careful consideration – whilst it will engage some, it could alienate others depending on their familiarity with technology and its accessibility. Therefore, a hard copy may still be the best way of getting the message across. Hard copies can also be more appropriate for key information which must be retained by members, for example, those relating to tax liability.
Keep a record
Whichever method is used, remember to keep complete records of all communications issued and the issue date. It can be vital to identify what members were told at a particular point in time, whether to ensure clarity regarding benefit provision or perhaps in future litigation. If new versions of documents (e.g. booklets) are uploaded, it makes sense to retain a physical record of each version. If live presentations or Q&A sessions are held with members (particularly for benefit change exercises), make sure a written transcript is produced and stored.
And don't forget data protection. When using any electronic platform you must comply with data protection obligations, ensuring that appropriate security measures are in place to prevent unauthorised access or disclosure of member data.
Assess your achievements
TPR recommends that trustees have a communications plan with clear objectives that are tested. It is therefore important to identify your communications goals at the outset and to devise key parameters to assess whether those objectives were met.
For example, the communications plan might look at the topics addressed, how often you communicate or responses to different formats. Success rates can be monitored by looking at the number of ‘hits’ to a website, how quickly a communication is accessed or how many members take action in response.
Some schemes are going a step further – inviting member feedback or holding focus group sessions to hear what members think. This might not work for all, but good communications practice is constantly evolving.
1 The Occupational Pension Schemes (Disclosure of Information) Regulations 1996
2 Pensions Act 2008 and the Occupational and Personal Pension Schemes (Automatic Enrolment) Regulations 2010