Pension Fund Governance Reinforcement Act
The Dutch Pension Fund Governance Reinforcement came into effect on July 1, 2014. This Act sets new criteria for pension fund governance. One of the aims of this Act is sound stakeholder representation. The Act also aims to streamline organisations and pension fund duties, broaden expertise and reinforce internal supervision.
Pension Fund Code of Governance
Besides the new Act there is also the new Pension Fund Code of Governance. This came into effect on January 1, 2014. The Code contains standards to improve pension fund performance. If pension funds deviate from the standards they must explain why. This will make the way that pension funds are governed more transparent.
Sound pension fund governance
Sound pension fund governance means that the Board must be competent. It ensures that the pension scheme is administered properly and with care. It is also important that all stakeholders feel that the Board represents them fairly. Additionally, the pursued policy must be clear and transparent. Furthermore the Board must account to an Accountability Council annually. This Accountability Council consists of employer, employee and pension beneficiary representatives. Finally, pension funds must have set up internal supervision.