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General Code of Practice finally laid before parliament

Stuart Henderson, Director, Pension Funds
woman using tablet on bench

On 10 January 2024, the General Code of Practice was finally laid before Parliament. The laying period lasts for 28 days and it is expected the code will come into force on 27 March 2024.


The General Code of Practice (the “Code”) is the name given to The Pensions Regulator (“TPR”) programme to merge 10 of the existing codes of practice into a single new code of practice. The consultation on the single code ran from 17 March 2021 to 26 May 2021.

TPR states that the Code is not prescriptive about methods that governing bodies should use to meet their expectations, in recognition that different approaches may be appropriate for different schemes.

The key areas covered by the Code are the governing body, funding and investment, administration, communications and disclosure and reporting to TPR and there is increased guidance is given for cyber security, ESG and expectations on financial transactions.

Changes from the draft code

The main changes made from the draft code are:

  • There is now a clearer linkage between Effective System of Governance (“ESOG”) and the Own Risk Assessment (“ORA”). Therefore, the ESOG and ORA outputs work together so if there are significant changes or risks identified then these need to be captured and recorded in both.
  • Remuneration policies need only cover costs for which the governing body is responsible and there is no requirement to make them available to members.
  • TPR has added introductory paragraphs at the beginning of some of the modules explaining the type of schemes to which they apply.

ESOG, ORA and timings

An ESOG should include processes and procedures to ensure compliance in the following areas:

  • Management of activities covering the role of governing body, meetings and decision making, remuneration and fee policy, knowledge and understanding, governance of knowledge and understanding, dispute resolution procedures and scheme continuity planning.
  • Organisational structure covering appointment and roles of the chair, conflicts of interest, managing advisers and service providers and risk management function.
  • Investment matters covering governance, decision making, monitoring, stewardship, climate change and statement of investment principles.
  • Communications and disclosure covering general principles for member communications.

The detail of what constitutes an ESOG will be dependent on the size and complexity of the scheme however internal controls are a key feature of any system of governance. Trustees should regularly consider the performance of internal controls in mitigating risk.

There are various assurance frameworks suitable for use in relation to pension scheme operations. Governing bodies should understand the limits of each type of assurance, and the limits to the scope of any assurance process and how each can play a part in reviewing the internal controls framework of a scheme. This may include obtaining independent or third-party assurance about controls.

Governing bodies of schemes should also carry out and document an ORA of their ESOG. The ORA is an assessment of how well the ESOG is working, and the way potential risks are managed. The ORA documentation should cover how the governing body has assessed the effectiveness of each of the policies and procedures covered by the ORA and whether the governing body considers the operation of the policies and procedures to be effective and why. This should at least cover policies for the governing body, risk management policies, investments, administration and payment of benefits. It is not necessary for all of the ORA elements to be assessed at the same time, but the ORA should be completed at least every three years.

The scheme’s first ORA should normally be prepared and documented within 12 months beginning with the last day of the first scheme year that begins after the Regulator has issued the Code. So, a scheme with a 31 March year end will need to prepare and document its first ORA by 31 March 2026.


Now that there is clear timeline in place, Trustees will need to start to plan the steps that need to be completed to prepare their first ORA. If not completed already, the first step is to prepare a gap analysis between the scheme’s existing governance framework and the requirements under the Code. Trustees will need to consider how to address the gaps identified proportionally given the size and nature of the scheme.

How we can help

If you wish to discuss this further, get in touch with Stuart Henderson or your usual Crowe contact.


The Pensions Regulator has released its second consultation on the draft defined benefit funding Code of Practice.

Contact us

Shona Harvie
Shona Harvie
Partner, Pension Funds Group