Red Health Check
A Full Body Scan for a Pension Scheme
In a Red Health Check, clients receive a detailed overview of the scheme’s exact current condition, as well as a detailed risk assessment that includes a full Asset Liability Management (ALM) diagnostic review. The report contains a set of clear and actionable recommendations stemming from this analysis, with reasoning for how those actions can benefit the scheme’s returns and risk profile and the scheme as a whole.
RED Health Check is a way for Trustees to undertake periodic check-ups with Redington, a third party and independent advisor. Trustees gain:
- A third party, independent assessment of your investment strategy and risk management framework;
- A list of key areas of concern;
- Suggestions for improving returns while maintaining or reducing risk;
- An introduction to new asset classes and an impact assessment of engaging with them.
The combined test results and recommendations can prompt constructive conversation amongst Trustees about the scheme’s goals, progress and overall direction, and can stimulate productive debate about how best to reach them.
Included in the Report
A full diagnostic ALM review is run initially to understand and quantify the various risks to which the scheme is exposed; then a Flight Plan analysis is produced, showing the returns that are required for the scheme to meet its funding objective on time. Along with the ALM analysis and Flight Plan, a series of stress tests on the pension scheme are completed in order to ascertain sensitivities to economic factors like interest rates and inflation and in extreme scenarios. Additional analysis can be included at no extra charge.
“Redington’s Health Check provided us with an independent and comprehensive review of our investment strategy and risk management framework. The output both challenged and confirmed certain aspects of the Investment Committee’s strategy, and provided a wealth of material to consider and debate. This included a list of suggestions for improvement that were both practical and actionable. The service was genuine value for money and required little upfront work by the Trustees. It’s always best-practice to get the engine checked – even if the engine seems to be working fine.”
Jonathan Clarke, Investment Committee Chairman – RHM Pension Scheme