Your members’ future in safe hands — the Mercer DC Master Trust

 

Outsourcing your workplace pension scheme to the Mercer DC Master Trust can deliver cost and time savings for your business and opportunities to improve outcomes for your people.


Introducing the Mercer DC Master Trust

The cost and complexity of managing a DC pension fund are increasing as regulatory and governance requirements increase. At the same time, many scheme members don’t have enough saved for their retirements because they haven’t always had the right help and information to prepare.

 

Our DC master trust helps address these problems by providing:

 

  • Access to best-in-class investments
  • Digital tools and engaging communications focused on holistic financial planning
  • Independent governance by professional trustees

Our DC master trust’s unique open architecture operating model allows participating employers access to best-in-class providers in each of their areas of specialism. Independent trustees are responsible for ongoing governance while you, the employer, keep the ability to decide on contributions.



Did you know Mercer's DC Master Trust has?


Leveraging our scale to delive

25

years of experience within the DC Master Trust industry globally.

2

independent administration and platform providers.

10

year investment performance track record for default option.

2050

Date by which net zero absolute portfolio carbon emissions achieved for our multi‑asset funds.



Why choose the Mercer DC Master Trust?

  • alt

    Governance

      

    The Mercer Master Trust (“MMT”) is authorised by the Pensions Regulator, this requires us to demonstrate that the MMT meets certain required standards.

     

    Our independent trustee board has real teeth when it comes to governance, with the ability to change the component parts in our openly structured operating model. The Trustees meet regularly throughout the year to discuss administration, communications and investments.

     

    Our robust governance framework ensures enhanced oversight of the investment and administration performance. Formal quarterly investment governance meetings take place to ensure investment options remain appropriate and market leading. We also undertake regular performance reviews of the administration services.

     

    We provide regular reporting on investment performance and administration to our participating employers. 

     

     

  • alt

    Administration

      

    There are three pillars underlying our approach to governance and administration:

     

    1.       Independence

    The independence of the Mercer Master Trust (“MMT”) is a key design strength, we have integrated leading components in each element of the member experience. Our administration services are currently provided by Scottish Widows and Aviva.

     

    We select our underlying administrators using whole-of-market research based on a wide range of criteria. This approach enables us to future proof the MMT as we can switch out an administrator with minimal impact to members or without winding up the trust if necessary.

     

    2.       Enhanced service levels

     Our independent approach enables us to provide truly conflict free administration. We have measureable service levels enhanced against what our administration partners provide outside of the MMT. These service levels have financial penalties attached for non-delivery.

     

    3.       Improving the member experience

    We use feedback from members in addition to the information obtained from the monthly governance process to drive enhancements to the member experience. 

  • alt

    Investments

      

    The investment options available in the Mercer Master Trust (“MMT”) are designed to cater for all members regardless of their required level of support. Your members benefit from access to Mercer’s investment expertise, from our extensive manager research capabilities to our global portfolio construction insights.

     

    Mercer SmartPathTM changes over the course of a member’s life and can target one of three retirement outcomes; income drawdown, annuity purchase or full encashment. The Trustees of the MMT will work with you to decide which one of these three options will be the default option for your employees, if members don’t make an investment choice this is where their pension savings will end up.

     

    Take a closer look at recent performance here.

     

     

    If members wish to select their own investments, the MMT has this covered. We have a broad fund range which is monitored and regularly updated to reflect Mercer’s best investment ideas.

     

    We have a range of multi-asset risk-profiled funds, including the Mercer Growth fund (used in the default option), each of which targets a different level of risk and return.

     

    For those members who wish to take full control of their savings, the MMT also offers a comprehensive range of self-select funds, covering all major asset classes and offering both active and passive management styles.

    • Multi-asset risk-profiled funds

      ·         Mercer Defensive Fund

      ·         Mercer Moderate Growth Fund

      ·         Mercer Growth Fund

      ·         Mercer High Growth Fund

    • Active funds

      ·         Mercer Active UK Equity Fund

      ·         Mercer Active Global Equity Fund

      ·         Mercer Active Global Low Volatility Equity Fund

      ·         Mercer Active Global Small Cap Equity Fund

      ·         Mercer Sustainable Global Equity Fund

      ·         Mercer Active Emerging Markets Equity Fund

      ·         Mercer Active Emerging Markets Debt Fund

      ·         Mercer Active UK Property Fund

      ·         Mercer Absolute Return Fixed Income Fund

      ·         Mercer Global Listed Infrastructure Equity Fund

      ·         Mercer Cash / Mercer Active Money Market Fund

    • Passive funds

      ·         Mercer Diversified Growth Fund

      ·         Mercer Passive Global Equity Fund

      ·         Mercer Passive UK Equity Fund

      ·         Mercer Passive Overseas Equity Fund

      ·         Mercer Passive Emerging Markets Equity Fund

      ·         Mercer Shariah Fund

      ·         Mercer Passive Over 5 Year Index-Linked Gilt Fund

      ·         Mercer Passive Over 15 Year Gilt Fund

      ·         Mercer Passive UK Corporate Bond Fund

      ·         Mercer Passive Sustainable Global Equity Fund

      ·         Mercer Pre-Retirement Fund

      ·         Mercer Inflation-Linked Pre-Retirement Fund

      ·         Mercer Diversified Retirement Fund

  • alt

    Communication and engagement

      

    Our member engagement strategy ensures that the right communications are delivered to the right people, using the right channels and at the right time.

     


     

    A key part of our communication and engagement approach is Mercer Money, our market-leading financial wellness platform – available as an app or website. Mercer Money uses open banking, with bank standard security, to deliver a holistic view of an individual’s finances (earnings, savings, borrowing and assets) all in one place.

     

    Find out more about this powerful app here

  • alt

    Implementation

      

    The project to implement any new scheme will be expertly managed by our highly experienced programme and implementation team from start to finish. These teams have been responsible for successfully on boarding numerous schemes.

     

    The project will be overseen by a programme manager and managed in line with a six-stage process, following PRINCE2 methodology. The programme manager will liaise with all internal and external stakeholders and oversee dedicated specialists within the project, such as the asset transition team.



Mercer’s approach to responsible investment

The United Nations Principles for Responsible Investment defines responsible investment as a strategy and practice to incorporate Environmental, Social and Governance (“ESG”) factors in investment decisions and active ownership.

 

At Mercer we believe that a sustainable investment approach is more likely to create and preserve capital value for long-term investors. In particular, we believe that climate change poses a systemic risk and that, as investors, we should consider the potential financial impacts of the transition to a low carbon economy and the physical impacts of different climate outcomes.

 

ESG factors are incorporated throughout the Mercer Master Trust’s investment arrangement, including Mercer SmartPathTM, in line with Mercer’s four-pillar framework.

 


 

Integration

 

We expect managers to consider any Environmental, Social or Governance factors that might impact the value of members’ savings and to incorporate these into their investment decision-making.


 

Stewardship


Our investment managers are expected to have strong processes in place to ensure they are voting and engaging with investee companies to protect members’ interests.



 

Investment


We believe that investing in sustainable themes can offer return opportunities for members and can also help to manage risks. For this reason we have allocations to specific sustainable-focused funds within our default Mercer SmartPathTM.


Screening


Although we prefer integration and engagement we want to avoid profiting from activities that don’t align with our members’ values and so we exclude these from our investments.



 

 Net-zero commitment

 

Consistent with our sustainable investment approach we have committed to a target of net-zero absolute carbon emissions by 20501. for our multi-asset funds and plan to reduce portfolio relative carbon emissions by at least 45% from 2019 baseline levels by 20302. This includes the Mercer Growth fund used within our default investment option.


1. Defined as absolute carbon emissions, per $M of assets under management and Scope 1&2 emissions.

2. Per dollar of assets under management. While the funds continue to maintain an investment objective of seeking long-term growth of capital and income, they also promote environmental characteristics though progressive decarbonisation with a view to achieving net zero emissions by 2050.






Fill 1 Created with Sketch.
The cost and complexity of managing a DC pension fund are rising as regulatory and governance requirements increase. At the same time, many scheme members don’t have enough saved for their retirements because they haven’t always had the right help and information to prepare. Our DC master trust can help address these issues.
Fill 1 Created with Sketch.

Tom Curtis, Workplace Savings Strategy & Commercial Leader

 

Getting started on the DC master trust journey

Employers are increasingly turning to DC master trusts to escape the increasing regulatory burden and to provide members with the expertise and services they need.

 

This option isn’t for everyone, and there is a great deal of variety between those that are in the market. Here are some questions to get you started:

 

Your position:

 

  • Have you got the expertise and resources required to deal with the increased governance and regulatory burden faced by DC pension funds
  • Are you prepared for that burden to increase as ESG requirements and other regulations intensify?
  • Are your members getting the investment knowhow and advice and support they need for a smooth path to a comfortable retirement?

 

The DC master trust:

 

  • How independent is the DC master trust of its manager?
  • What is the range of resources available to the DC master trust?
  • How much flexibility does the DC master trust have to employ the best providers?
  • What services can the DC master trust provide to support your members?

 

Meet the Mercer Master Trust trustees

All of the Trustees are 100% independent of Mercer, we want to ensure that the trustee board always act in the best interest of members.

 



Speak with a Mercer consultant

We’re eager to speak with you. Please provide your details below.
*Required Fields

Important notice:


This information is based on our current understanding of legislation, taxation and HMRC practice which may change in the future. It is for information only and is not personal financial advice. If you require financial advice you should seek this from an authorised financial adviser. The value of investments can go down as well as up, so you could get back less than you invest.