Claire Southern, partner at Hogan Lovells, joins Paul Kitson, head of UK pensions consulting at EY and Charlotte Moore, co-founder of Moore Squared Communications for the third episode of EY’s Re-imagining pensions podcast.
In this episode we get the lawyer’s perspective of what it’s like to operate in a surplus environment. Claire discusses how this changing the role of trustees and the greater array of options available to them.
We unpack how a surplus environment could also change the way super funds are built with the possibility of new superfunds targeting run-on now a possibility.
Claire jokes that a lawyer’s default position is to think about what could go wrong and talks about the importance of trustees being flexible enough to think about what they should do if bond yields fall and surpluses turn into deficits.
We discuss how trustees also need to stay flexible in the face of a world of increased geopolitical risk which has the potential to reshape government agendas and the future trajectory of interest rates.
For example, for many decades investing in the defence sector was an anathema to sustainable investors but that changed with the invasion of Ukraine. Claire emphasises how important it is to look at what will bring the most benefit over the longer term.
Finally, when offered a magic wand to change one thing in pensions, Claire says she would ask the sector to focus on the important long-term goals of providing people with a decent retirement and for us to not get caught up in issues like GMP equalisation which only benefit lawyers and advisers
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