Governance

The plan administrator has fiduciary and other responsibilities to plan members and beneficiaries. A plan administrator for the purposes of pension legislation and pension plan governance is the Board of Trustees. If needed, the plan administrator should engage appropriate professional advisors.

A fiduciary relationship exists when a plan administrator and/or any delegates can exercise discretionary power to affect members' or beneficiaries' interests. The greater the discretionary powers, the greater their fiduciary duties. The plan administrator and delegates must act in good faith and in the best interests of plan members, beneficiaries and other stakeholders of the pension plan when carrying out their fiduciary responsibilities.

In its fiduciary role, the plan administrator's responsibilities include:

Treating members and beneficiaries impartially;
Acting with the care, skill and diligence of a prudent person;
Interpreting the plan terms fairly, impartially and in good faith;
Preventing personal interests from conflicting with those of the plan; and
Within the scope of its authority, ensuring that members and beneficiaries receive promised benefits

When employers, bargaining agents or their nominees act as plan administrators, they must understand the difference between their plan administrator and other roles, and act accordingly. When acting as plan administrator, employers or bargaining agents should follow the principles in the Canadian Association of Pension Supervisory Authorities (CAPSA) Pension Plan Governance Guidelines.

The Board of Trustees for the Canadian Merchant Service Guild Eastern Branch Pension Plan has created policies to assist with the governance of the pension plan. The Statement of Pension Plan Governance Guidelines and Structure includes the mission statement for the plan and for the fund, a code of ethics, standards of professional conduct, and a conflict of interest policy, among other things.