However, have you paused to reflect on the responsibility you shouldered when you accepted your nomination? Do you understand your responsibilities — your fiduciary duties — and have you considered how best to ensure that you fulfill them, and live up to your colleagues’ high expectations?

Instead of a heavy textbook setting out all the myriad things you have to attend to as a trustee, fiduciary duties give you a set of principles you need to adopt. Once you have mastered the principles you can apply them in any situation you find yourself in as a trustee, or to any decision you need to make.

Your duties

Fiduciary (trustee) duties were originally established through common law — Roman law and Roman-Dutch law — which has subsequently been developed further by rulings from our courts against trustees whom the court found did not act appropriately in relation to their trust.

Today, many of these duties are coded by legislation, in particular the Pension Funds Act and the Financial Institutions (Protection of funds) Act. The term "fiduciary" comes from the Latin fides, meaning faith, and many of the duties are concerned with good faith, loyalty and trust:

• you must act with "due care, diligence and in good faith";
  
• you must not put your interests before those of your members;
  
• you must take "all reasonable steps" to protect members' interests;
  
• you must not profit from your trustee position (unless the members consent);
  
• you must avoid conflicts of interest.

The best decisions

You can start by putting your members' interests foremost in your mind (before your own interests), and then making it your job to fully understand the issues facing your fund so that you can make the best decisions for your members.

If you do not feel 100 percent comfortable with the latest deliberations by the board, do not be lulled into thinking that as long as some members of the board seem confident about what is the right course of action, you can just go along with them. You will not be carrying out your fiduciary duty of care towards your members.

The other trustees may be overlooking something and, without your informed input, the best decision for members may not be taken. This can also have serious consequences for yourself.

Held accountable

In law, a trustee of a retirement fund must be a natural person who speaks "with his own voice" — a trustee must apply his mind and come to his own conclusion.

This differs from representing a juristic person, such as an employer or a union, and speaking with "the voice of the organisation". In the latter case you cannot be held accountable. However, as a trustee of a retirement fund, you can be sued in your personal capacity for negligence.

In my experience as a consultant to retirement funds, the best kind of trustee is the one who refuses to move on until he or she understands the issue thoroughly. This trustee needs to understand so that they can make the right decision for members and ensure their interests are protected. While my recommendations will be considered, the trustee will still make his or her own decision.

'Stupid questions'

I believe it’s better for the trustees to make these judgments as they understand their membership better than I do.

Do not be afraid to ask "stupid questions". Often they are not stupid at all, and can lead to further discussion and greater insight for everyone. Scrutinise reports.

If something does not look right to you, then find out why. Question the views and recommendations from experts, as experts can be wrong and you will be accountable if things go awry.

Don’t remain silent if you have doubt about what you are being told. Importantly, if something had to go wrong with your fund, could you stand in front of your members and assure them you did all you could to fulfill your fiduciary duties and that this is just a terrible case of bad luck?

Ken Schumann is an actuarial consultant for Old Mutual Actuaries & Consultants.