We caught up with Jo Waldron, one of our Company Appointed Trustee Directors, to talk to her about her role as a Trustee Director of the Prudential Staff Pension Scheme (Scheme) and to find out more about the Task Force on Climate-Related Financial Disclosures (TCFD) report, published by the Trustee last year.

Hi Jo, thank you for joining us today. Perhaps you could start by telling us why you decided to become a Trustee Director?

My day job is working in the Private and Alternative Assets Team and throughout my career I’ve found something of a niche in understanding relatively complex investment strategies, simplifying them and talking to other people about why they should invest. My clients today are dominated by UK pension funds – so the opportunity for me to see how things work from the ‘other side’ has been invaluable.

I think my day job has had a positive influence on the running of the Scheme, but equally my experiences of being a Trustee Director have really helped me with my role at M&G.

I also have a real interest in financial education and encouraging people to think about their financial future – and it’s been great to help my M&G colleagues understand the importance of saving for retirement – it really is a privilege.

So, you’re a Company Appointed Trustee Director, Jo. How did that come about?

I joined the Trustee Board in 2020. At that time, one of the previous Trustee Directors had left the Company so there was a vacancy for someone with a diversified investment background – which I have! I was put forward by a couple of M&G colleagues for the role, interviewed by the Trustee Directors, and was very pleased to be successful with the appointment.

The role is very busy – I sit on the Defined Benefit (DB) Section and Defined Contribution (DC) Section Committees, as well as the DC Section Investment Committee. It’s been a steep learning curve over the last few years, but very enjoyable.

What have you enjoyed about being a Trustee Director?

I’ve really enjoyed my involvement with the DC Section Investment Committee as I can use my experience in my day job to make a real impact and ‘get my teeth’ into things. I’ve also very much enjoyed meeting with the various advisers to the Scheme and seeing how everything operates from different perspectives. Drawing on the experience of the other Trustee Directors, who have so much experience in pensions has also been invaluable.

Now, what have been the challenges you’ve had to get to grips with?

As I said before, it’s been a steep learning curve. There’s a lot of papers you need to read and understand in a short space of time before meetings, but you soon get used to it.

I’ve found it both challenging and enjoyable getting to grips with the actuarial side of things – which was fairly new to me before I joined the Trustee Board, but we have some great Actuarial Advisers from Willis Towers Watson, who have helped me learn the ropes.

Do you have any tips for people who are interested in becoming a Trustee Director in the future?

So, an important skill to have as a Trustee Director is the ability to process large amounts of information and becoming accustomed to not ‘doing the doing’ but rather directing people to ‘do the doing’.

I’d advise anyone who’s interested in becoming a Trustee Director to join internal committees. This way, you can gain experience participating in scenarios where there’s a lot of information being provided from different people and areas of the business, which then needs to be pieced together to give you an overall picture. You also have to learn the right questions to ask, and this comes with experience.

The Scheme recently published their TCFD report, which is available on the Scheme website within the Document library. Could you perhaps give us a little bit of background as to what this is?

Absolutely. TCFD stands for ‘Task Force on Climate-related Financial Disclosures’. To take a step back, climate change presents a financial risk to the economy. In a world with higher global temperatures, certain companies or assets might not represent the good investment for the long-term as they appear today. This could be due to risks associated to the transition to a low carbon economy, however it should be said here that this may also present a whole suite of investments which are opportunities. There’s also a whole raft of ‘physical’ climate-related issues that can impact investments such as rising sea levels.

TCFD encourages us to look at our investments through the lens of climate risk and to disclose how we’re managing these risks. We therefore published our first TCFD report, and these will be published on an annual basis.

One of the most interesting things that we had to do as part of the report was to conduct a ‘scenario analysis’. We looked at how both the DB and DC Sections separately might fare over a range of different climate-related scenarios. We also have to set certain metrics and targets as part of the report which helps give us a sense of direction and set our principles for the future.

As we stand today, we have set a net zero ambition aligned with M&G’S 2050 target and have collected our first set of data. This then allows us to start the analysis to help us understand how we’re going to meet our target. We’d love to hear from our members about what they’re looking for with investments from this perspective - I really do encourage people to read the report on the website.

What should members look out for over the coming months?

Well, 2023 has already been another busy year for the Scheme and the world of pensions in general. The DC Section has reworked the investment options available to members - we’ve been in touch with members recently about this. We’ve run another Member Nominated Trustee Director selection process. And what I’m particularly excited about, is being involved with the valuation of the DB Section of the Scheme – this happens every three years and it’s the first time I’ll be involved.

In the world of pensions, work is ongoing with the Pensions Dashboard. This is a government-led initiative which will provide pension members with an online hub to view all of their pension information across multiple schemes, so members should look out for updates on this.

Thanks so much for your time today, Jo. Before you go, perhaps you can let us know what you like to get up to outside of work and your role as Trustee Director?

Well, we recently moved out of London, so I spend a fair amount of time making improvements to our house. I also have a five-year-old daughter, so a lot of my spare time revolves around taking her to various princess parties. I’ve also become very adept at negotiating my way around Disney + and finding programmes involving her favourite princesses at any given time.

Thanks again, Jo we hope to speak to you again soon.