The Pensions Regulator (TPR) has published guidance on the responsible use of artificial intelligence (AI) in the pensions industry. The regulator encourages trustees to explore how AI can help provide better member outcomes while understanding and managing the risks it presents.
TPR notes that AI has the potential to transform the pensions industry through improved efficiency, value for money, and member outcomes. However, it also warns that AI can introduce new risks, including around cyber security.
The guidance outlines seven key principles for trustees and scheme managers, which match how TPR itself uses AI. These principles include starting with the problem, not the technology, and ensuring that human responsibility remains central.
Trustees should use the opportunities on offer in a responsible manner.”
Gunnee added that trustees don’t need to be AI experts, but they are accountable and must always know where AI is used, ask the right questions to challenge providers, and manage risks that any new technology presents.
The data and digital industry working group, established by TPR, has also developed an AI ‘jargon buster’ to support trustees with understanding terminology and in discussions with providers and advisers.
Association of Consulting Actuaries AI Steering Group chair, Kiran Mandalia, said, “TPR has rightly taken a principles-based approach here: one size doesn’t fit all. AI can feel daunting for some trustees, and a clear set of questions to work through gives them a practical place to start.”
The guidance helps trustees understand how their existing duties and good governance apply to using AI, rather than creating a new set of regulatory requirements. Trustees remain responsible for decisions affecting schemes and members, and they should ensure that appropriate governance and oversight are in place.
