The UK workplace pensions industry is undergoing one of the most significant periods of transformation in its history.
From regulatory reform and consolidation to changing expectations around engagement, value and retirement adequacy, the direction of travel is clear: the industry is being challenged to deliver better outcomes for the people it serves.
But amid all the debate around productive finance, private markets, consolidation and mandation, there is a risk that we lose sight of the most important stakeholder of all: the customer.
This needed culture shift starts with language.
The pensions industry continues to refer to the people saving into workplace pensions as “members”. Yet almost every other industry would recognise them for what they really are: customers.
This isn’t semantics. This update in language causes a fundamental alteration in how we think about the people we serve, how we design propositions and, ultimately, how we improve their financial futures.
When you think of someone as a member, the relationship can become passive and administrative, characterised by low interest or engagement.
When you think of them as a customer, the focus changes entirely. You start asking different questions. What do they need? Are they getting good value from us? Are we helping them achieve their goals?
Too often in workplace pensions, decisions are shaped around employers, trustees, regulators or policymakers. Of course, these stakeholders matter enormously. Employers choose the provider, and schemes must operate within robust governance frameworks. But the end customer, the person whose money it is and whose future depends on it, cannot become secondary in the process.
Workplace pensions are one of the few sectors where the customer does not choose the product themselves. That makes it even more important that the industry puts their interests at the heart of decision-making. This shift in language and emphasis can make a big impact.
This matters now more than ever because the scale of change facing the industry is enormous.
Alongside regulatory reform sits a growing push for pension capital to play a greater role in supporting the UK economy, particularly through investment into productive finance, infrastructure and private markets. Initiatives such as the Mansion House Accord and the debate around mandation reflect a clear policy ambition to encourage greater investment into UK growth assets.
The broader objective is understandable. Policymakers want pension schemes to help drive economic growth while also improving long-term net returns for savers. Many providers and schemes, including Cushon, support that direction of travel and are already investing with a long-term outlook focused on diversification, innovation and improved retirement outcomes.
But throughout these debates, one principle must remain constant: customer needs come first.
The success of any investment strategy should ultimately be measured not by political objectives or industry targets, but by whether it improves results for customers. Does it deliver better returns and retirement incomes? Does it improve their engagement and confidence? Does it help customers feel more connected to their savings and future?
This is where adopting a genuine customer mindset becomes critical.
Equally, focusing on customers means recognising that value is about far more than cost. It is about delivering the best possible experience, communications, support, investment strategy and retirement outcome. As providers, I believe we achieve the best results for our customers when we put their needs first, rather than simply meeting institutional requirements.
This is not about replacing fiduciary duty with consumerism. It is about strengthening fiduciary duty through a deeper understanding of the people that pensions exist to serve.
That is why the industry’s transformation cannot just be about regulation, structures or asset allocation. It must also be cultural.
Changing the language from “members” to “customers” may sound simple, but it moves the emphasis from compliantly serving a group of members to achieving good outcomes for each and every individual paying customer. It reinforces the idea that people deserve the same focus on experience, value and performance that they receive in every other area of financial services.
The pensions industry has an enormous opportunity ahead. But as reforms gather pace, we must not lose sight of the customer.
Because if we truly want to improve outcomes, customers must be at the heart of every decision we make.
Troy Clutterbuck is MD of Cushon