The National Pension Commission (PENCOM), has set new guidelines for appointments to board and top management positions of all Pension Funds Administrators (PFAs).
A circular with reference no PENCOM/INSP/SURV/11/04 which was signed by Head of Surveillance Department, Mohammed Datti and addressed to all PFAs, stated that any PFA with funds under management of N100 billion and above must create a minimum of eleven departments in its company.
Some of the departments to be created include contributions/collections, investment, benefit administration, business development/relationship, management, finance compliance, risk management, Information Technology, administration/human resources, internal audit and legal/company secretary.
The circular further directed that where a PFA has Retirement Savings Accounts (RSA) funds up to N100 billion and above, it must have two separate investment departments with one each for the RSA Fund and other funds. Also, the circular stated that a chartered financial analyst should be appointed to head each of the investment departments.
Another requirement according to the circular, is the existence of the office of the managing director and two executive directors (EDs) with the latter overseeing departments and not units. “The MD/CEO should have only three departments, Legal/company secretary, internal audit and compliance reporting to him.”
It also stated that all core operational departments should report to the MD through executive directors, adding that the core operational departments for this purpose are contributions/collections, benefits administration, investment, ICT, business development/relationship management, risk management, administration/human resources and finance department.
It however, said that the new requirements would however not affect the existing approved Board and top management staff of affected PFAs.
Stating the requirements for opening branch in the other states, it said that in a situation where a PFA has 10,000 or more RSAs in a State, the PFA must open a branch in that state which must meet the following service requirements; human resource and ICT requirements as specified in the Commission’s circular for branch opening as well as have a benefit administration function.