Effective member communication can have a significant impact on financial outcome, particularly in relation to DC pension schemes. The Pensions Regulator has today issued guidance on member communications. In addition, it has published an investment guide that can be provided to members.
The ‘Effective member communications’ guidance is for use by trustees, managers and employers and contains principles and guidelines on following good practice in written communications to members. The focus is on the schemes that appear to be in most need of support; smaller schemes may have less to spend on communications experts and advice, though schemes of all sizes can benefit from the guidance. Regulator choses to focus on written communications because these are the most widely used.
A common issue identified in research was that people did not have a communications plan or take any steps to see how successful their communications had been. The regulator’s guidance emphasises the importance of these considerations and the key messages contained in the guidance include:
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identify your objectives and have a clear communications plan;*
identify the best ways to communicate;*
tailor communications to the audience;*
remember the needs of all groups, not just active members;*
be open and honest;*
avoid jargon; and*
try to get members to engage.
As an additional tool, the regulator has also published a separate investment guide, ‘Making pension fund choices – think before you choose’, which trustees and employers can issue, if they so choose, to help members understand the DC fund choices available to them. It helps them to give members adequate support in this important area that impacts directly on the level of member benefits.
Reports show that trustees and employers are reluctant to communicate with members about investments, and stakeholders have supported the idea of drafting this straightforward guide that employers and trustees can issue to give members basic information that could set them in the right direction.
“In a world that is increasingly DC oriented, the issue of member understanding is of fundamental importance,” says Chris Dobson, executive director of strategic development. “The regulator’s objective is to see that the right information is communicated effectively to members by trustees, providers or employers, enabling members to make the best decisions.”
To view this guidance, please visit the web-site.
D.C.