As contributions into the new pension scheme continue to grow, stakeholders are canvassing that part of the fund should be set aside for repairing the country’s decayed infrastructure. In this interview, Managing Director of Stanbic IBTC Pensions, Mr. Demola Sogunle, said that utmost care should be taken in making such investment so as not to waste pensioners’ money.
What role do you think pension funds can play in bridging Nigeria’s financing requirements?
A common challenge in Nigeria has been matching long term developmental goals with short term capital funding. The pension funds provide an opportunity to match long-term projects with long-term funds; however the fiduciary responsibility of all stakeholders must be met to ensure that at the end, everyone is better off.
The work to be done now is setting up the institutional framework that ensures people’s pensions, 10 -30 – 40 years from now don’t get swallowed in projects. It is also important that fixed income securities, floated to finance long term projects such as infrastructure, are structured in such a way as to protect the contributors against inflation, which can erode the real returns on such instruments in the long term.
Do you feel enough is being done by key stakeholders to raise awareness and enlighten people about pension matters in the country? What more could be done?
A lot is being done already, but more can be done. Just being here and talking to you is one way of doing more. Basically, as many communication channels as possible must be used to spread the message about the new scheme. Probably, the voices of religious and traditional leaders will lead to more awareness; that is one avenue yet to be fully exploited.
Stanbic IBTC Pension Managers has been in operation for less than a decade, what have been the key drivers of your rapid growth?
We can attribute that to a few factors; firstly, people. From inception we have been fortunate to assemble a world class team of professionals, their ideas, commitment and energy is one of the key drivers of the business today. The second factor is vision; the board and management have kept faith with the core vision of the business.
It is a vision founded upon strong convictions that avenues do exist in our nation for wealth creation and preservation. Also, sound professionals exist who can midwife such portfolios for the entire stretch of 10 to 50 years. Being part of the Standard Bank Group reinforces that belief of 150 years of service and wealth creation in Africa.
What is your take on Delayed and irregular payment of retirement benefits and what is Stanbic IBTC Pension Managers doing to ensure prompt and easy access to retirement benefits by its customers?
We keep introducing new ways to ensure that at the point of submitting the application all documents and issues are ironed out. The documentation process and calculations done at the point of submission is vital, most delays can be avoided if the right sets of documents are submitted at the right time, however different companies have several ways of handling staff retirement and disengagement, so some of these internal company processes do not align with the pension laws.
Such organisations are notified of what is required and amendments are gradually being made. Also if bottlenecks do arise, we immediately contact the client through multiple channels like SMS, phone calls and emails. This way the issues are quickly addressed.
How is Stanbic IBTC Pension Managers able to overcome this challenge?
The information is in the public domain, there is nothing hidden. The fund performance of PFAs is shown on their respective websites and on the PenCom website. Annually, PFAs and PFCs are statutorily required to publish the financial reports of their Retirement Savings Account Portfolios. The industry is transparent. In SIPML, we do all these without fail
What differentiates Stanbic IBTC Pension Managers from other Pension Fund Administrators?
I would say it is the people. If you take the same set of people into a new business today and give them the same amount of time, you will probably get the same results more or less. It is all about commitment.
Are there any lessons from other markets where the contributory pension scheme has worked that Stanbic IBTC Pension Managers is bringing to bear on its operations in Nigeria, considering its Standard Bank heritage?
Yes, we are leveraging our parentage to introduce a robust IT platform for improved operations and service quality. In addition, we have rode on the mobile electronic banking platform to introduce multiple remote access points for our clients to make enquiries and check their RSA balances via email, cell phone, short code and the latest cardless transaction on ATM
Although Stanbic IBTC Pension Managers is amongst Nigeria’s foremost PFA, what goals have you set for the company in the medium and long-term?
Beyond our borders, SIPML has served as a reference point for similar businesses in West Africa. Hence, in the long term we aim to be Africa’s reference point for pension management. The demographics and institutional architecture of most African nations are very different from Europe, Asia and America; hence how we manage pensions in Africa should be slightly different.
Also, we aim to out-perform our past in terms of delivery of quality service. We honestly believe there are many things that could be done better regarding turnaround time for payments, communication with clients and sensitising employers about the need to participate in the scheme.