The 2025 sole trustee landscape report, highlights the growth of professional corporate sole trusteeship appointments, which have grown significantly over the last two years after a slowdown in the previous year. This is in line with the leading pensions and financial consultancy’s prediction of a short-term reduction in growth in its February 2025 report.
Looking at this growth in the wider context of the DB pension scheme landscape the report also highlights that 20% of schemes have appointed a professional trustee as a sole trustee. It also found that most sole trustee appointments are still at the smaller end of the market with around 40% of appointments being for schemes with fewer than 100 members and 75% for schemes with less than 500 members.
The analysis also showed that despite the 13% increase in the overall number of sole trustee appointments over the last year, the proportion of schemes without a professional trustee has remained broadly unchanged. The report points to the increase of DB scheme wind-ups and the decline in use of professional trustees as co-trustee as the main reason. Over the same two-year period, the proportion of appointments as co-trustee fell from 32% in 2023 to just under 25% in 2025.
Commenting on the Sole Trustee landscape and changes over the last year and how the consultancy expects to sector to develop in the future, Shani McKenzie, Head of Sole Trustee Services, Hymans Robertson says: “This year we have seen the growth in sole trustee appointments return to double digits. That’s a trend we’d believe will continue for at least another few years as firms and market capacity continues to grow. We still expect board governance reviews to result in a variety of roles being met by professional trustees but with sole trusteeship continuing to dominate. Some schemes may choose to appoint a professional trustee as a co-trustee or, the Chair of Trustees depending on how the needs of pension scheme boards evolve.
“As schemes wind up and the DB universe continues to contract, it will take notable overall growth in professional trustee appointments to see a material decrease in the proportion of schemes without a professional trustee. That’s not something we’ve observed in the last year, as most of the growth in sole trustee appointments has been fuelled by the conversion of trustee board appointments.”
The report also looked at governance structures and delegations for eight of the largest sole trustee providers. It highlights, that professional trustees have welcomed The Pensions Regulator’s (TPR) announcement of its professional trustee engagement programme focused on maintaining a culture of open regulatory dialogue. The announcement builds on the current principles-based self-regulation set by the Association of Professional Pensions Trustees (APPT). The report notes that most sole trustee providers firms will have sole trustee governance processes and internal controls aimed at complying with and heavily influenced by, the voluntary code of practice .
Commenting on how Sole Trustee’s are shaping their governance, McKenzie, adds: “Sole trustee providers are clearly using a range of internal governance structures to oversee the management of the thousands of schemes they govern with the size of the scheme often driving what’s proportionate. Much like trustee boards the governance arrangements needed for the handful of complex scheme with 10,000 or more members may differ from the governance needed for the 40% of schemes with less than 100 members.
“When it comes to how sole trustee providers structure their teams, our report shows that larger firms tend to take one of three approaches to constructing their delivery teams. We saw a few key differences. Firstly, in how support teams are used, then how governance and secretarial work is separated from trusteeship and also how specialists or in-house advisers are deployed. What was largely preferable across firms was to have one relationship lead for the employer, as relationships are personal but broadly the form of engagement with the employers was similar to how trustee boards would operate.
“In terms of in-house governance approaches of the sole trustee providers we’ve observed two key areas of difference, relating to the breadth of the head of sole trustee’s role and the level of oversight on individual schemes. As sole trustee portfolios have grown, a few firms have noted the need to review and refine their oversight functions to support a larger number of appointments.”
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