Case Study: Growing our pension scheme with Acuvest’s assistance

Since management completed a buy-out in 1993, Jones Engineering Group (JEG) have assisted their employees in saving for retirement via a Defined Contribution (DC) scheme. In 2013 JEG had concerns that scheme decisions were not always driven by member objectives. The company and trustees needed reassurance that they were doing right by their people and decided that they wanted advice that was independent from the investment managers.

JEG’s main asset is its people and they invest heavily in their people. And, like all companies, JEG is ultimately responsible for the type and quality of the DC scheme in place for its people supported heavily by the trustees, who have specific legal responsibilities to the members. But neither the company nor the trustees, who volunteer their time willingly, are pension experts. They are responsible for employees’ retirement savings but must be able to rely on the advice they are receiving to be independent and be seen to be independent.

Acuvest were engaged as an independent adviser. A comprehensive review of the scheme was undertaken in order to agree the objectives of the scheme for the company, the trustees and its members, all informed by an in-depth analysis of existing scheme members and their likely savings needs.

Following the review, a number of significant improvements were made in the scheme. It was decided that the scheme branding would emphasise ‘Jones Engineering Group’ to promote the improved scheme and the benefits for people. This ensures that members better understand that it is the company providing the benefit and that member focus is on investment objectives of the funds and not the provider brands when making investment decisions.

The range of fund options and fund managers on offer were also simplified and improved including a completely redesigned default programme which would automatically innovate and remain relevant and appropriate for members.

With the support of Acuvest, the company also offers access for members to an Independent Financial Adviser on reaching 55 years of age which is designed to ensure choices being made in the crucial pre- retirement planning phase are appropriate to each member.

The scheme governance structure was also updated and the right levels of support were established to allow the trustees to discharge their responsibilities and empower them to make decisions with member outcomes in mind.

In the first three years of working with Acuvest, membership of the scheme has grown by 65%, assets within the scheme have doubled and over 60% of members now contribute more than the standard 5%. Ongoing communications campaigns driven by Acuvest, in partnership with the trustees, ensure awareness and engagement with the retirement savings scheme.

Jones Engineering Group is now confident and comfortable that its scheme is a strong value proposition for its people. Company time spent on the scheme has significantly reduced while still achieving the highest governance and risk management standards.

The trustees value that there is a ‘one team ethos’ with Acuvest and that there is someone to call on for support and independent advice on any pension issue. The collective strength of investment knowledge, provided by Acuvest, ensures rigorous and constructive challenge of fund managers on behalf of members and that the trustees feel supported and have confidence in their decision making.

“As trustees we feel confident that with the support of Acuvest we are providing the best solutions and outcomes for our members. We value our independent relationship and see many benefits from the rollout of the communications strategies.”