This is an important communication from the Trustee to all members concerning the governance arrangements of the HSBC Bank (UK) Pension Scheme (“the Scheme”).

The Scheme provides pension benefits for over 190,000 members enjoying both final salary and defined contribution benefits and the Trustee bears a significant responsibility to ensure that benefits are delivered effectively and efficiently. It is important that the Trustee Board has the right mix of skills and experience and we believe these changes recognise best and emerging practice.

In October 2018 HSBC UK Bank plc, the Principal Employer and sponsor to the Scheme, notified the Trustee of several intended changes to the structure of the Trustee Board of the Scheme with effect from 1 March 2019, or as soon as practicable thereafter;

• An Independent Professional Trustee would be appointed to enable the Trustee to benefit from wider experience and expertise;
• Hugh H Pugsley, General Counsel, HSBC UK Bank plc, has been appointed by HSBC UK Bank plc as a Bank Nominated Director with effect from 1 March 2019, in place of Stuart J Walker following his resignation on 31 December 2018.  This will help ensure a strong and continuing connection with the Scheme sponsor.
• The size of the Board will be reduced from thirteen to eleven as an interim step in a planned and phased reduction of the number of Trustee Directors to nine. There is a general trend both within and outside the Bank to reduce the size of governing bodies to maximise effectiveness and efficiency.
• Once the Board comprises nine Trustee Directors the balance of the Board would be five BNDs, comprising four BNDs including the Independent Trustee plus the Trustee Chair and four Member Nominated Directors (MNDs). In the interim phase of eleven Trustee Directors (from 1 March 2019) there will be seven BNDs including the Independent Trustee and the Trustee Chair and four MNDs.

Following a special Board meeting on 11 February 2019 when the selection process was approved, an independently chaired selection panel was constituted to interview those serving MNDs who wished to be considered for re-appointment and new terms. The four MNDs who were selected are listed below with their respective terms;

• Richard Dixon – expires February 2021 (initial appointment, 1 December 2015)
• Beverley Horler – expires February 2022 (initial appointment, 1 March 2017)
• Keith Plummer – expires February 2023 (initial appointment, 2 January 2018)
• Stuart White – expires February 2024 (new five year term following initial appointment on 1 March 2014)

At the expiration of these new terms, the Trustee will invite all members of the Scheme to nominate candidates for selection as a MND. This will extend to pensioners, deferred members and those in employment with the Bank, encompassing both final salary members and defined contribution members.

This is a development from holding elections in two constituencies for active members and pensioner members, and reflects the changing demographics within the membership of the scheme, in that deferred members form the majority of the membership. It is fundamental to the role of a Trustee Director that decisions are made in the interests of all members.

Going forward, following the member nomination process, an independently chaired selection panel will select the candidate with the desired skills, and competencies, in accordance with objectives and criteria set by the Trustee and to ensure there is a good mix of skills, perspective and experience on the Trustee Board.

If you would like to know more please view the FAQs here. If you have any immediate queries please contact the WTW Administration team here.