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The Actuary The magazine of the Institute & Faculty of Actuaries

Communication named the most desired quality in actuarial consultants

Communication skills are the most valued quality in actuarial consultants, a survey of 100 senior pension trustees has found, but many are finding this to be in short supply.

Communication is increasingly important ©iStock
Communication is increasingly important ©iStock

Almost two-fifths said they value communication, or the ability to provide timely progress updates and clear information, above all other performance-based qualities.

However, four out of the top five challenges that trustees face when building a better consultant relationship are related to communications.

Difficulties in coordinating feedback, overcoming internal politics, providing concise objectives, and giving clear project briefs were cited by 69%, 63%, 59% and 56% respectively.

Barnett Waddingham, which carried out the research, said communication is increasingly important as defined benefit schemes reach maturity and shift strategic focus.

Head of actuarial consulting, Paul Houghton, said: “As priority shifts to managing the end game of risk reduction, often leading towards buyout, so is the role of the actuarial consultant changing. 

“Trustees are now expecting consultants to perform multiple roles, be it business partner, strategic adviser or outsourced administrator – clear communication is key.”

Knowledge, client-focus, exceeding expectations, accuracy, and proactivity were also cited as valued qualities by the respondents, which were all from large UK pension schemes.

But it was found that 61% of pension schemes are at least considering changing their actuarial consultant in the next year, possibly because of communication shortcomings.

Houghton said the onus also falls on trustees to improve communication, and to establish processes around appointment and evaluation of consultants to enhance relationships.

“Communication is a two-way street,” he continued. “It is absolutely essential trustees know what the scheme requires and can communicate this with the consultant.

“Better engagement between makes for a better relationship. This gives trustees greater confidence in their actuary, and better engagement should result in better outcomes for members.” 

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