Is Your Board Keeping Pace? Why Self-Evaluation Matters More Than Ever
“Even if you are on the right track,
You’ll get run over if you just sit there”
As a trustee of a public retirement system, you shoulder the highest legal standards of loyalty and care, higher than those of a corporate director.
You're responsible for overseeing the management of the retirement security of teachers, firefighters, police officers, and thousands of other public servants who've dedicated their careers to serving your community. The decisions you collectively make today will affect whether these hardworking people can retire with dignity and financial security decades from now.
That's why board self-evaluation isn't just good governance—it's essential stewardship of public trust.
Why Self-Evaluation Matters More for Pension Trustees
Public pension boards face unique challenges that make regular self-assessment particularly critical. Unlike corporate boards that answer to shareholders who can sell their stock, you're accountable to beneficiaries who have no exit strategy. Their entire retirement often depends on your collective ability to navigate an increasingly complex landscape.
The Weight of Fiduciary Duty. When a corporate board makes a poor decision, shareholders might see their portfolios decline. When a pension board stumbles, teachers and firefighters could lose their retirement security. This heightened responsibility means you can't afford to operate on autopilot or assume that good intentions are enough. Regular self-evaluation helps assure you're living up to the extraordinary trust placed in you.
Managing Public Scrutiny. Your decisions play out in newspaper headlines and city council meetings. Board evaluation helps you stay ahead of legitimate concerns while building the credibility needed to weather inevitable political pressures. When you can demonstrate a commitment to continuous improvement, you strengthen your position to make tough but necessary decisions.
Competing Stakeholder Interests. A retirement system’s stakeholders include active employees, retirees, taxpayers, and future generations simultaneously—groups whose interests don't always align. Self-evaluation helps you navigate these competing demands thoughtfully and consider all perspectives in your decision-making process. But the bottom line is that you must make decisions that are solely in the best interests of the beneficiaries.
The Pace of Change
Perhaps nowhere is the acceleration of change more evident than in pension fund management. The strategies and assumptions that worked for previous generations of trustees are being challenged at an unprecedented pace.
Investment Evolution at Breakneck Speed. The investment landscape is transforming faster than ever. New asset classes emerge regularly, from infrastructure debt to cryptocurrency. Environmental, social, and governance considerations can reshape markets.
Private equity strategies multiply and evolve. Meanwhile, traditional asset allocation models face questions they've never encountered before.
Your board needs to stay current not just with these developments, but with their implications for long-term pension security. Self-evaluation helps identify whether your board has the knowledge, processes, and external relationships needed to keep pace with this rapidly evolving environment.
Patient Long-term Investors. Despite the pace of these changes, public retirement systems have a unique advantage that few other institutional investors possess: time. With benefit obligations stretching decades into the future and new members joining, these systems can afford to ride out market volatility and economic cycles that force other investors to make hasty decisions.
This patient capital allows retirement systems to invest in assets that may take years to mature—from infrastructure projects that provide steady returns over decades to private equity investments that need time to create value.
By maintaining a long-term perspective, retirement systems can capture illiquidity premiums, avoid the costly mistakes of market timing, and build portfolios designed to fund retirement security rather than chase quarterly performance.
The public employees counting on these systems don't need their pensions to perform well next quarter; they need them to be there when they retire in twenty or thirty years. This fundamental alignment between investment horizon and benefit obligations gives patient retirement systems a powerful competitive advantage in building wealth over time.
However, being a long-term patient investor doesn't mean operating on autopilot or ignoring the rapidly evolving investment landscape. While retirement systems can afford to take the long view, trustees must stay current with emerging risks, new opportunities, and shifting market dynamics that could affect their long-term strategy.
Climate change, technological disruption, demographic shifts, and regulatory changes can fundamentally alter the assumptions underlying a twenty-year investment plan. The debates about ESG investing, the growth of alternative assets, evolving cybersecurity threats, and changing member expectations all require informed oversight from trustees who understand their implications.
A truly patient investor isn't one who ignores change, but one who thoughtfully adapts their long-term strategy as new information becomes available. Trustees who fail to keep pace with industry developments risk making patient capital decisions based on outdated information—potentially jeopardizing the very long-term outcomes they're trying to protect. It’s not just an investment.
Technology and Operational Transformation. Pension administration has moved from paper records to sophisticated digital platforms in just a few years. Cybersecurity threats proliferate. Data analytics capabilities that seemed futuristic five years ago are now standard expectations. Beneficiary communication has shifted to digital channels that many trustees and the beneficiaries are still learning to navigate.
Regular self-evaluation helps to assureyour board isn't falling behind on operational oversight just because you're focused on investments. Both are critical to your fiduciary duties.
Changing Workforce and Benefit Expectations. Today's public employees have different career patterns, retirement expectations, and financial literacy levels than previous generations. Gig economy principles are creeping into public sector employment. Younger workers think about benefits differently from their predecessors.
Your board needs to understand these shifts to make informed decisions about benefit design, member education, and long-term sustainability. Self-evaluation helps identify gaps in your collective understanding of the workforce you serve.
A Practical Framework for Pension Board Evaluation
Effective self-evaluation for pension trustees requires addressing both traditional governance questions and the unique challenges of retirement system oversight.
Investment Governance and Expertise. Start by honestly assessing your board's investment sophistication. Can you engage meaningfully with your investment consultant? Do you understand the risks and potential returns of your current portfolio? When complex investment opportunities are presented, does your board ask the right questions?
Consider whether your board has kept pace with investment innovation. Are you familiar with the latest developments in your asset classes? Do you understand how changing market conditions might affect your long-term assumptions?
Operational and Administrative Oversight. Evaluate how well your board understands the day-to-day operations that serve your members. Do you receive meaningful metrics about member services? Are you confident in your cybersecurity protections? Do you understand your system's technology capabilities and limitations?
Stakeholder Communication and Relations assess your board's Effectiveness in communicating with the various groups you serve. Are you transparent about challenges while maintaining confidence in your stewardship? Do you proactively address concerns before they become crises?
Keeping Pace with Change. Build specific questions about adaptation and learning into your evaluation. How does your board stay current with industry developments? What mechanisms do you have for identifying emerging risks or opportunities? Are you investing adequately in trustee education and development?
Making Evaluation Actionable. The goal isn't to become experts in every aspect of pension management—that's what you hire staff and consultants for. Instead, focus on assuring your board can collectively provide effective oversight, ask the right questions, and collectively make informed decisions.
Identify Learning Priorities. Use your evaluation to pinpoint areas where additional trustee education would be most valuable. Maybe you need to better understand alternative investments, or perhaps operational technology deserves more attention. Targeted learning is more effective than generic training.
Strengthen External Relationships. Consider whether your board is getting the expertise and perspective it needs from consultants, staff, and peer systems. Self-evaluation might reveal that you need different voices in the room or more frequent updates on industry developments.
Adapt Your Processes. As the pace of change accelerates, your board may need to adjust how it makes decisions, receives information, or allocates its time. Evaluation can help identify process improvements that keep you agile without sacrificing thoroughness.
Take The Long View
Remember that your decisions today will affect public servants for decades to come. The teacher starting her career this year is counting on your board to make sound decisions for the next thirty years. The firefighter approaching retirement needs to know his pension will be there when he's earned it.
Board self-evaluation helps assure you're prepared for that long-term responsibility. It's an investment in your own effectiveness that pays dividends in better outcomes for the people who've dedicated their careers to public service.
In a world of accelerating change, standing still means falling behind. Regular, honest self-evaluation keeps your board moving forward, growing stronger, and better equipped to fulfill one of the most important trusts in public service.
How effective is your board self-evaluation?
Here are five key questions to assess the effectiveness of your board self-evaluation process:
Did the evaluation reveal specific, actionable insights that your board didn't already know? An effective evaluation should uncover blind spots, not just confirm what everyone already suspected. If your results only validate existing assumptions or produce vague generalities about "improving communication," the process likely isn't probing deeply enough. Look for concrete discoveries about decision-making patterns, knowledge gaps, or relationship dynamics that genuinely surprised the board.
Can you point to tangible changes in board behavior or processes that resulted directly from your last evaluation? The ultimate test of evaluation effectiveness is whether it drives meaningful change. This might include modified meeting structures, new educational initiatives, clearer role definitions, or different approaches to oversight. If your board completed an evaluation but continues to operate exactly as before, the process failed regardless of how comprehensive it appeared.
Do trustees feel safe providing honest, critical feedback about board performance? Effective evaluation requires psychological safety—the confidence that candid input won't damage relationships or create political problems. If trustees consistently give positive ratings across all areas or avoid mentioning obvious issues, your process may be encouraging diplomatic responses rather than genuine assessment. Anonymous feedback and neutral facilitation can help, but the real test is whether tough conversations actually happen.
Does your evaluation process help the board adapt to external changes affecting your system? A good evaluation should assess not just internal dynamics, but whether your board is keeping pace with the evolving industry standards, regulatory requirements, and investment practices. For retirement systems, this means examining whether trustees have the knowledge and processes needed to address emerging risks like cybersecurity, climate change, or demographic shifts that could affect long-term sustainability.
Are you measuring progress over time, or just taking annual snapshots? Effective evaluation tracks improvement trends rather than treating each assessment as an isolated event. Can you demonstrate that the identified weaknesses from previous years have been addressed? Do you see evidence of growing sophistication in areas where the board committed to development? Without this longitudinal perspective, you're conducting surveys rather than driving continuous improvement.
Why it matters?
Board self-evaluation for public retirement system trustees isn't a luxury or compliance exercise—it's a fundamental responsibility to the thousands of public servants whose retirement security depends on your effectiveness.
In an era of accelerating change across investment markets, technology, and workforce expectations, even the most experienced trustees must commit to continuous learning and improvement.
The teachers, firefighters, and public employees you serve deserve a board that regularly examines its own performance, adapts to new challenges, and grows stronger over time. By embracing honest self-assessment and translating insights into meaningful action, your board demonstrates the same dedication to excellence that you expect from the public servants whose futures you're protecting.
Their retirement security—and your fiduciary legacy—depends on your willingness to never stop improving.
Adapted from “Transforming the Dialogue: Fiduciary Essentials.”
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