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The future of Pensions – imagine if...Governance 2.0 and beyond
An experimental French multiplane prepares for a flight attempt in the 1890s.
The future of Pensions – imagine if...
� Pensions Today…
� Collaboration
2
� Social Media
� Governance 2.0 – Building a Community
...solve these problems?
� Multi-Dimensional Decision Making
� Governance: Responsibility of the Trustees
� Complex Decision Making Process
� The pension fund industry faces tough times
3
� Multiple insolvencies have added to the problem
� Companies are reacting
� Filtering through the noise
� How are trustees reacting: At a recent Trustee 100 event.
Accountable, Responsible Decision Making
Negotiating with the Sponsor
Setting a recovery plan
Agreeing a funding
Assets : Investment decisions
Setting a risk budget
Design and Establishing a view Assessing available
Liabilities : Benefits decisions
Agreeing the technical provisions
with the Scheme Actuary
Governance: Responsibility of the Trustees
Agreeing a funding schedule
Design and implementation of a hedging programme
Establishing a view on financial markets
Strategic asset allocation
Exploiting tactical market opportunities
Assessing available financial products
Fund Manager appointments
Main Trustee Board
Advisor(s) Scheme Actuary
Complex Decision Making Process
Investment sub-committee
Non financial sub-committees
Joint Working Group(s)
Actuary
The pension fund industry faces tough times
Multiple insolvencies have added to the problem
Companies are reacting
Chairman
Employer nominated
CIO
Actuaries
Lawyers
Asset Managers
Corporate Sponsor
Trustee Board
Filtering through the noise
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Employee nominated Independent
Investment Consultants
Investment Banks
RegulatorProduct
Providers
Lack of expertiseFocus on past, not
future strategyMaking decisions
takes too long
...lonely...Too much
How are trustees reacting: At a recent Trustee 100 event.
10
Lack of
accountability
Not enough timeImplementing
decisions takes too long
...lonely...Too much
information
The Rise of Collaboration...
� Yochai Benkler dubs it “the wealth of networks" � Howard Rheingold's term is "smart mobs." � It's the idea of technology-enabled collaboration … and it's making us all
smarter.
The collective action of beehives, photographed by Ted Horowitz.
� Jimmy Wales began Wikipedia on 2001 based on the willingness of people to share their knowledge.
� …one of the most-referenced, most-used repositories of knowledge on the planet, with more than one million articles in English (compared with the Britannica's 80,000) and hundreds of thousands in dozens of other languages, all freely available.
� The "wiki" in the name refers to software that allows anyone with Internet access to add, delete or edit entries. This has led to controversies about the reliability of the information, prompting the Wikimedia Foundation to set tighter rules for editors, while still keeping
The Free Encyclopaedia
prompting the Wikimedia Foundation to set tighter rules for editors, while still keeping Wikipedia open-source.
� "Wikipedia represents a belief in the supremacy of reason and the goodness of others. ...From the respectful clash of opposing viewpoints and the combined wisdom of the many, something resembling the truth will emerge. Most of the time."WIRED
http://www.wikipedia.org/
• Rice University professor Richard Baraniuk has a giant vision: to create a free global online education system that puts the power of creation and collaboration in the hands of teachers worldwide.
• Connexions, a website that allows teachers to quickly "create, rip, mix and burn" coursework -- without fear of copyright violations. Think of it as Napster for education.
• …it‘s open-source system cuts out the textbook, allowing teachers to share course materials, modify existing work and disseminate it to their students -- all for free, materials, modify existing work and disseminate it to their students -- all for free, thanks to Creative Commons licensing.
• …hundreds of online courses and used by a million people worldwide, Baraniuk's virtual educational system is revolutionizing the way people teach and learn.
• …it could become a powerful force in leveling the education playing field.
Connexions... http://cnx.org/
Social Media
Social Media
The convergence of Broadcasting & Communications Media
Years 13
38
Growth of Different forms of media
Years
1
13
Actual Statistic: 9 months - 100 million users
1990
Social Media: Timeline
1990 1994 1995 2000 2001 2003 2004 2005 2006
Stage 1 - 2004 Stage 2 - 2005 Stage 3 - 2006
Harvard Only High School Networks Everyone
Stage 4 - 2009
300 million users
Social Media: The Growth of Facebook
Social Media: Business Applications
Governance 2.0:Building a Community
We want one place to access all information
We each have defined roles
I can work at my
We have more regular meetings so
spend more time looking forward than recapping the past
I can share experiences with
other trustees
I can see what others think
about solutions
What trustees are saying
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own pace, when I have time
I feel better informed to
make decisions
We have a small working groupthat focuses on implementation
about solutions
We use independent trustees to challengethe board, advisors,
managers etc
Community Better governance
Define roles
Retain control
Hear others’ views on providers
Share experience
Another way
Smaller implementation groups
More regular meetings
Targeted education
In your own time
providers
The future of Pensions – Manchester 2014
� ....explosion of social media and online work will continue to blur geographic boundaries
� ...continuos improvements in communication and technology.� ...actuaries will be even more globalised . � Actuaries have the opportunity to help clients with their skills and
experience – need to adapt to changing landscape.
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� Which are you?� Sniff/Scurry� Hem/Haw
� Thank you and Good luck!
Direct Line: +44 (0) 20 7250 3416Telephone: +44 (0) 20 7250 3331
Redington13-15 Mallow StreetLondon EC1Y 8RD
Robert GardnerFounder &Co-CEO
Feel free to Connect, Share and Discuss...
� 2009...mail, phone and email
� In addition...� In addition...
� http://twitter.com/robertjgardner
� http://uk.linkedin.com/in/robertjgardner
