Adopt good governance and treat customers fairly, pension fund trustees urged

Pension Fund trustees and administrators have been urged to adopt the RBA guidelines on good governance and treating customers fairly.

The trustees in a two-day workshop on governance in Naivasha were told that adoption of good governance practices will ensure effective service delivery, viability, and sustainability of such schemes.

“Good governance is a bed rock of a well run retirement benefit scheme, and there is a clear link between good governance and good performance outcomes. Without good governance, we are likely not going to achieve good outcomes,“ Zamara Group CEO Sundeep Raichura said.

According to Raichura, though good governance is an essential tool to good results, it is not an end in itself.

The CEO said currently, though there are volumes of good governance initiatives that the regulator has brought on the table, there lies a great risk of overwhelmed trustees just reverting to ticking the box and not focusing on what needs to be done.

This, he said will likely leave an insufficient room for decision making by the trustees.

“Good governance is not about ticking boxes.  In the context of a pension fund, it is about achieving good outcomes for members of pension funds” added Raichura.

Raichura urged pension funds to play their rightful role in developing the country. “With the correct incentives and regulatory interventions, the pensions sector in Kenya can play a significant role in our country, particularly in financing the country’s developmental needs, which include infrastructure and provide much needed financing to industry and businesses through capital markets and private equity financing,” he said.  

 Participants at the seminar will also review the pre and post COVID investments opportunities and engage with PS Charles Hinga on the Government’s affordable housing program and the new RBA mortgage regulations.

Raichura’s sentiments were echoed by Zamara Manager of Supervision at the Retirement Benefits Authority Caroline Wanjala who said the RBA guidelines are intended to ensure that pension schemes are well anchored on robust governance principles and optimal investment strategies to ensure continued growth of the industry.