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MONITORING

Keeping your journey on track by monitoring what matters

While on the road you should be keeping a close eye on your car’s dashboard and GPS unit, making sure your engine runs smoothly and you remain on course. Similarly, between valuations, balanced and timely covenant, investment, and funding-level monitoring is crucial to spot any issues early and respond quickly. This will also help you avoid any surprises at the next valuation.

STAGE 1
SET UP MONITORING ARRANGEMENTS
WITH YOUR SPONSOR

Determine Monitoring Arrangements

Timely and proportionate monitoring is crucial to effectively managing risk and keeping your journey on track.

  • What metrics will be used to monitor your covenant, scheme, and funding position?
  • How should information flow?
  • Does scheme governance allow for an honest and open assessment of how things are going?

Agree Contingency Plan

A well thought out contingency plan agreed by all parties can help you respond to emerging situations quickly and effectively.

  • Set limits and triggers during calm periods.
  • Pre-determine actions to take if there are breaches.
  • Adjust your scheme’s governance as necessary to enable trustees to react and respond.

Use The Worry Index

  • As a high-level health check of your scheme’s position.
  • As an impartial measure of scheme-sponsor dynamics.

The Worry Index is a guide and can facilitate conversations between trustees and sponsors outside of valuations.

Visit The Worry Index

STAGE 2
IMPLEMENT YOUR
MONITORING ARRANGEMENTS

Track Key Performance Indicators

Keep an eye on the things that matter most, ensuring these get reviewed thoroughly and do not become a ‘tick box’ exercise:

  • Covenant strength.
  • Investment risk and return.
  • Funding level.
  • Scheme maturity.

Prepare for Unexpected Events

What other indicators are there that might be cause for concern?

  • Is demographic experience in line with assumptions?
  • Are returns tracking according to expectations?
  • Are there corporate transactions or technological innovations across the sector that cause concern?
  • What other corporate activity is occurring?
NEXT VALUATION DATE
What Next?