EFRBS Trustees

Background

IFG Group PLC is a financial services business listed on the Dublin and London Stock Exchanges, with a number of institutional and private shareholders.

The international division of IFG Group Plc provides specialist trust and company management and administration services to a broad range of national and international financial institutions, corporates and high net worth individuals. These services are delivered by our team of 450 people across eight jurisdictions who manage and administer over 6,500 client structures holding assets in excess of EUR 50 billion.

A significant part of the business of the international division is the provision of bespoke employee benefits solutions including Employee Benefit Trusts (EBTs), Employer Financed Retirement Benefit Schemes (EFRBS) and Share Schemes.

Choosing an EFRBS Trustee

The increase in the volume of legislation, regulation and economic pressures in recent years has amplified the workload and responsibilities of trustees.

EFRBS are a specific type of unregistered pension arrangement which offers a wide choice of assets in which to invest and complete flexibility in how members plan for retirement. In addition the arrangements have compelling potential for tax planning.

Our EFRBS trustee solutions are tailored for each client. We are able to compile a range of agreed standard or open architecture investment propositions on a scheme by scheme basis.

From a corporate governance perspective, the corporate sponsor of an EFRBS must appoint trustees that have expertise in the management of such arrangements, that add value to the performance of the scheme and live up to member expectations.

The choice of trustee is of overwhelming importance to the running of the scheme on two levels. It is the trustee who is responsible for ensuring:

• that effect is given to the beneficial terms of the scheme; and

• the proper investment of contributions received and that, in particular, that the scheme strikes a balance between the interests of all the members.

In partnership with corporate sponsors and their advisors we compile solutions that best suit the scheme design, from establishing schemes that provide online administration platforms that can securely be accessed by members and the corporate sponsor to bespoke arrangements that adopt complex investment strategies.

How can IFG help?

IFG’s trustee services combine experience and understanding of clients’ needs, which allows us to construct innovative and bespoke services. We take our fiduciary responsibilities extremely seriously and, in particular, we recognise that one of the trustee’s key roles is to ensure that the investment of the scheme’s assets is managed within a risk and return controlled portfolio.

We understand that clients’ overriding expectation is the delivery of investment performance. Given the increasing complexity and range of investment solutions available, the trustee regularly monitors and appraises the investment performance of each scheme. The process typically involves the results of periodic performance updates and risk assessments being presented to the trustee and due consideration given to the portfolios’ performance versus benchmark, peer group, asset allocation bands and risk comparisons.

In cases where investment performance falls below reasonable expectation, a systematic escalation procedure is operated to examine trends rather than single time periods. This ensures that the trustee benefits by seeing the performance of the portfolio placed into context over time.

Through understanding the dynamics of portfolio performance and adopting a highly pro-active approach to the ongoing monitoring of performance, the trustee is able to protect the best interests of scheme members.

Our fee structures recognise:

• the role and responsibilities undertaken by the board of the corporate trustee and the time required in fulfilling their responsibilities; and

• the scheme’s administration and record keeping, which will vary subject to the chosen investment solution.

Summary

As part of a quoted PLC with substantial expertise and years of experience of acting as corporate trustee, we are entirely free of conflicts of interest unlike many of our competitors who are owned by financial institutions that are driven to increase assets under management rather than focused on the provision of trustee services as the core business.

Our philosophy is to maintain the highest professional standards and to deliver a high calibre service without distinguishing between large and small clients.

Despite the fact that EFRBS are relatively new, IFG Trust (Jersey) has already been appointed to act as trustee of a number of EFRBS.

IFG does not provide taxation, legal or investment advice. The information and expression of opinion expressed in this briefing note are not intended to be a comprehensive study or to provide taxation or legal advice. Specific advice concerning individual situations should be taken and IFG can provide introductions to advisers who specialise in this area.