On 1 October 2008 the Companies Act 2006 introduces new rules on conflict of interest for company directors. This will affect both directors of employers who also act as pension scheme trustees and directors of corporate trustees who are also directors or employees of a scheme employer (or even just scheme members).
From 1 October a director will have a statutory duty to "avoid a situation in which he has, or can have, a direct or indirect interest that conflicts, or possibly may conflict, with the interests of the company". A director will avoid being in breach of this duty if the conflict is authorised in advance by the other (non-conflicted) directors. For private companies in existence before 1 October 2008, the transitional provisions require them to seek the approval of their shareholders if they want to permit such authorisation by the directors. Alternatively, shareholders may resolve that a director may retain his office despite a particular conflict situation.
Any company director who is concerned that his pension scheme interests or duties may put him in a position of conflict should take steps to ensure that the position is properly authorised in accordance with company law as outlined above.