What happens when a significant proportion of a scheme’s knowledge, governance activity and institutional memory becomes concentrated within a single organisation? Katherine Milton, who is part of our outsourced pensions management leadership team, looks at some of the challenges with concentration risk and outlines the key questions that trustees need to ask when assessing supplier concentration risk. 

Why do trustees need to consider concentration risk?

Concentration risk arises when significant proportion of a scheme’s knowledge, governance activity, and institutional memory becomes concentrated within a single organisation. This reduces resilience and where one organisation occupies multiple positions within a governance framework, there is a risk that alternative viewpoints become muted, reducing robust decision-making. 

What is Muse Advisory’s experience and difference in outsourced pensions management?

Muse Advisory’s outsourced pensions management team brings deep, wide-ranging knowledge and know-how acquired through successful careers spanning in-house, third-party and consultancy roles. Our difference lies in the depth of senior-level expertise aligned to outsourced pensions management, together with a team that asks the difficult questions and challenges thinking to reach the right outcomes. You can learn more here.