New guidance aims to clarify fiduciary duties

The government's initiative to update fiduciary-duty guidance for pension trustees has generated significant discussion within the industry. Aimed at enhancing clarity on how trustees should consider long-term investment factors while focusing on the best interests of members, the guidance is intended to bolster trustees’ decision-making confidence.

The Society of Pension Professionals (SPP) recently concluded its 2026 Conference with a panel discussion dedicated to the revised fiduciary duty framework. Reflecting on the guidance, Sir Robin Knowles CBE, a High Court judge and chair of the DWP’s technical working group, stated that while it has been facilitated by government, it has been led by industry. He expressed hope that the upcoming public consultation “will be as constructive as the engagement with the pensions industry over the last few months.”

Sir Robin emphasised the role of trustees, noting that they are “the guardians of the long term in an environment with many short-term pressures.” He explained that the new guidance should empower trustees to “make the best decision, not the decision that’s least likely to be open to challenge.” The clarity offered by the updated guidance is seen as vital in equipping trustees to handle investment decisions effectively.

Addressing concerns regarding the non-statutory nature of the guidance, Sir Robin reassured attendees that “it will be taken seriously because it has come from the sector as a whole” and is likely to gain the attention and respect of regulators and the courts alike.

Andy Cork, a Partner at A&O Shearman and chair of the discussion, highlighted the evolving nature of fiduciary duty. He remarked, “As fiduciary duty continues to evolve, it was clear from this panel discussion that the breadth of what we recognise as financially material is widening.” This evolution encourages trustees to adopt a more comprehensive view of financially material factors, moving beyond mere numbers to consider complex, long-term risks.

Cork added that while the guidance may have governmental origins, its industry-led approach is crucial. He expressed optimism that it will strike the right balance between clarity and flexibility. The SPP plans to continue its involvement in the discussion, particularly in responding to the upcoming consultation and striving to ensure that the eventual guidance provides the necessary certainty for trustees navigating contemporary systemic challenges.