Download Trustee Effectiveness: The Need for Strategic Choices

Trustee Effectiveness: The
Need for Strategic Choices
Anil Verma
and
Johanna Weststar
University of Toronto
To be read in conjunction with “What Makes for Effective Labor Representation
on Pension Boards?” by Johann Weststar and Anil Verma (Forthcoming 2007,
Labor Studies Journal) and “Just Having a Voice is Not Enough: Labour’s Voice
on Pension Boards,” by Johanna Weststar and Anil Verma (Forthcoming as a
chapter in Socially Responsible Investment of Union-Based Pension Funds, Jack
Quarter, Isla Carmichael, and Sherida Ryan (eds.) University of Toronto Press,
Toronto
FACTORS RELATED
TO TRUSTEE
DEVELOPMENT
Union’s
Strategic
Choices
Accountability
Structures
Recruitment
and Selection
Training and
Learning
Networks
Board Integration
and
Participation
SOME FINDINGS…
88% feel like integrated and participating
board members
BUT evidence of:
-
Lack of training
Lack of social networks
Lack of prior exposure to pension issues
Lack of guidance from unions
None
Poor
Minimal
Adequate
Good
Excellent
11%
8%
27%
25%
21%
8%
LEVELS OF
STRATEGIC
CHOICES
Full participation
with a
stakeholder
perspective
Full
participation in
a traditional
fiduciary role
A Seat on the
Board
At each level
implications for trustee
selection and support
grow and change
D
Seat available
to Union?
Campaign
for a seat
No
D1
SPECIFC
DECISION
POINTS
Yes
No
D2
Take a seat?
Denotes decision points
Leave
Governance
To Others
Yes
D3
Finance
Professional
D6
Fiduciary Duty
alone guides
trustee conduct
Labor Insider
“Regular”
Trustee
Fiduciary Duty+
Proxy Voting+
SRI+ETI+….
D4
Labor
Activist
Formal
Accountability to
Union/Membership
D5
Self-paced
Reporting
PENSION GOVERNANCE: A STRATEGIC
OPPORTUNITY FOR LABOUR
• BUT unions need to express a
comprehensive and proactive policy on
their role in pension governance
• AND decisions about trustee selection and
development must be aligned with these
strategic decisions
Two Broad Debates
1. Strategic Union Agenda
– What do unions want?
• Traditional fiduciary
• Broad stakeholder role
2. Trustee Selection and Development
– How do they get it?
• Human Resource Model?
• Nomination / Political Model?