Pensions and Retirement Training Course on Monitoring Investment Risk for Trustees

Module 1: Introduction to Investment Risk for Trustees
Overview of investment risks in pension portfolios
Role of trustees in risk governance and oversight
Fiduciary duties and accountability for investment risk
Types of investment risk: market, credit, liquidity, operational, and ESG
Case study: Lessons from risk oversight failures

Module 2: Risk Frameworks and Governance
Establishing a risk governance structure for pension funds
Risk management policies, risk limits, and escalation protocols
Roles of trustees, investment committees, and advisors
Risk culture and accountability
Workshop: Designing a governance framework for investment risk oversight

Module 3: Monitoring Market and Portfolio Risk
Understanding volatility, correlation, beta, and tracking error
Risk-adjusted performance metrics (Sharpe ratio, Information ratio, alpha)
Stress testing and scenario analysis for trustees
Early warning indicators for market risk and underperformance
Practical exercise: Interpreting and analyzing portfolio risk reports

Module 4: Monitoring Credit, Liquidity, and Operational Risk
Credit risk in fixed income and counterparty exposures
Liquidity risk and its impact on pension fund operations
Operational risk: processes, controls, and fraud prevention
Monitoring outsourced manager risk and third-party relationships
Case study: Managing liquidity challenges in pension portfolios

Module 5: Reporting, Communication, and Decision-Making
Reviewing risk dashboards and reports from investment managers
Communicating complex risk information to trustees and stakeholders
Integrating risk insights into investment decisions
Ensuring regulatory compliance and reporting obligations
Workshop: Presenting and discussing risk reports with trustees
Capstone exercise: Developing a trustee-focused risk monitoring framework