Professional Trustees enter new era as evolving endgame options and surplus opportunities reshape trustee role

According to LCP’s latest annual Solemates report which will be launched in September, Professional Trustees (PT) are entering a new phase of the DB pensions market, with stronger scheme funding levels, a growing range of endgame options and renewed focus on surplus requiring a broader set of skills and experience than ever before.

LCP's annual survey of leading PT firms found that nearly 80% believe the role of the PT will need to evolve as DB schemes become better funded and face increasingly complex strategic decisions. 50% of respondents also said that new skills and experience will be required to meet the demands of this changing environment.

The report highlights that as schemes move closer to their endgame objectives, the traditional "one size fits all" journey is becoming less common. Alongside buyout, trustees are increasingly considering a wider range of options, including run-on strategies, superfunds and surplus sharing opportunities. This growing choice is requiring Professional Trustees to help sponsors and fellow trustees evaluate a broader set of commercial, strategic and governance considerations.

Key highlights include:

• While technical pensions expertise remains important, the skills sponsors value most when appointing a Professional Trustee are evolving. Professional Trustee firms ranked collaboration and the ability to work effectively with sponsors as the most important attribute sought by employers, followed closely by pension risk transfer experience and the ability to control costs.
• As endgame decisions increasingly involve balancing competing objectives and navigating new opportunities, stakeholder management and commercial judgement are becoming just as important as traditional governance expertise.
• Surplus management has emerged as a particularly significant area of focus. Experience of managing and distributing surplus is now becoming a common feature of Professional Trustee appointment discussions. As schemes consider how surplus can be used, firms highlighted the importance of robust governance, transparency and clear decision making.
• More than half of firms believe formal governance processes, including peer review, documented decision making and clearly defined governance frameworks, will be crucial in demonstrating that member interests have been appropriately considered when making surplus-related decisions. Around a third also believe there can be value in involving member-nominated representatives where decisions are particularly sensitive.

The survey also shows that the PT market expects the Pension Schemes Act 2026 to reinforce many of these trends rather than change trustee behaviour. Key areas expected to shape trustee agendas include resolving issues arising from the Virgin Media judgment, particularly for schemes progressing towards buyout, and growing interest in surplus extraction and surplus sharing arrangements.

There is also expectation of increased optionality in the market, including the development of superfund and alternative risk transfer solutions, to encourage more schemes to reassess their long-term strategy. For some smaller schemes, however, buyout is still expected to remain the preferred destination.

Nathalie Sims, Partner at LCP and author of the report, commented:

“Professional trusteeship is moving into a new phase. Improved funding levels mean many schemes are no longer focused solely on how to reach buyout, but on which endgame strategy will deliver the best outcome.

“That shift is changing expectations of Professional Trustees. Technical expertise remains essential, but schemes increasingly need trustees who can bring commercial judgement, manage complex stakeholder discussions and provide strategic direction across a wider range of options, from buyout and run-on to superfunds and surplus management.

“The challenge is no longer simply securing an endgame, but making the most of the opportunities that strong funding has created.”