In Reply to: Two different points? posted by Brian Marks on 06 November 2003 at 20:58:36:
: Looks to me like GG and Tim are making different points.
: GG notes that the Courts are likely to apply higher standards to paid trustees than non-paid trustees. That is a timely warning, in case the trustees didn't realise. Personally, I have never thought it a big cause for concern.
Then .... hopefully no problem.
In my mind the pay might represent a real difference in "treatment" and interpretation by a court in the future if you accept that these issues are never precise and the unexpected always seems to happen. It also might represent a fear of trustees nbeing "bought" by the corporation.
For example in the EL scenario it is in my view unforgiveable that non-exec directors tried to say that they had insufficient technical knowledge to perform the duties of a director. But they were paid. This in my view places an additional responsibility on them to have turned down the offer of a paid directorship on the basis of their insufficient knowledge. If they took the cash knowing that they were defficient then they should expect to be kept to their obligations under the companies acts. In analysing why I felt that way I feel that being "unpaid" softens my attitude slightly - but an "important" slightness. I wonder whether the courts might take a similarly slightly more hardened attitude when they try to decide in the future "what is fraud" or "what was SERIOUSLY negligent" by a trustee particularly when there is a potential conflict of interest when being paid by the corporate sponsor of a pension plan, and when members are being disadvantaged to the benefit of the corporation.
In the last round of trustees elections, the company effectively fired an employee nominated trustee and replaced him with a company sponsored trustee. This was ona a board where members already effectivel had no control. Here the company showed that it could effectively thwart the wishes of the members and assert it's own. There is already a terrible conflict of interest between corporation directors and employees and pension plan trusteeship.
Some people might be concerned that the addition of payments by the company might be seen as an additional potential weakening of the relationship between members and trustees and a strengthening of the hold and relationship between corporation and trustees.
After all the trustees that we have most trust in are probably pensioners as well and I bet to some the job and extra cash is attractive and therefore perhaps a temptation to keep the company "sweet" may be feared by members, albeit you might say irrationaly.
GG