Sackers comments on TPR’s new AI guidance for pension schemes

TPR today published new guidance encouraging trustees of pension schemes to explore how AI could be used “to deliver better member outcomes” whilst protecting against inherent risks.

Commenting on the announcement Oliver Topping, partner, said: “Against the backdrop of AI use becoming increasingly commonplace in the pensions industry, today’s guidance is most welcome. AI is a powerful tool which can help improve and deliver any number of efficiencies but, as TPR clearly acknowledges, this comes hand-in-hand with certain risks, two obvious candidates being hallucinations and cyber threats. There are also hidden dangers for members in using freely available AI to help plan for their retirement.”

“Referencing existing duties and good governance obligations, the guidance is built around seven key principles for trustees and scheme managers to help guide their AI approach. Importantly though, as many of their functions are delegated, trustees and scheme managers are not expected to be experts. But, depending on their AI use (and that of their advisers) they might need to develop an AI policy to help set expectations.”

“In what is an ever evolving and rapidly growing area, today’s guidance provides a sensible and pragmatic framework. Trustees and scheme managers should take the time to discuss the guidance with relevant advisers, assess existing and possible future AI use, before deciding on what steps might be needed next.”