The Role of the Principal Officer & Trustee

Duty of the Principal Officer

The principal officer is a statutory appointment in terms of Section 11 of the Retirement Funds Act, 2005. Section 11 (1) states “Every registered fund shall have a principal officer who shall be a Swazi citizen resident in Swaziland”. The role of the principal officer is not only to ensure compliance with all regulatory and statutory requirements in terms of the Act and execute the retirement fund corporate strategies, but to also guide the management board of trustees on the responsibilities related to their function.

In terms of the Fit and Proper Guidelines issued by the Registrar of Insurance and Retirement Funds dated October 2009, trustees and principal officers must be fit and proper, which include the following criteria; good character, honesty, integrity, financial soundness as well as competence, best measured by the ability to demonstrate, through qualifications and experience, the capacity to successfully undertake the responsibility of the position.

Duty of the Management Board of Trustees

In terms of Section 8 (1) of the Retirement Funds Act, 2005 every retirement fund shall have a controlling body which shall be responsible for controlling the business of the retirement fund. The persons appointed in terms of Section 8 (2) shall be referred to as trustees.

There are numerous duties and fiduciary responsibilities imposed by the Retirement Fund Act, 2005 on trustees. A fiduciary duty is considered the highest obligation implied by law as it is the duty to act on behalf of someone else whilst subordinating one’s own personal interest. Some of these duties trustees are to undertake include the following:

• Taking all reasonable steps to ensure that the interest of members, in terms of the rules and provisions of the Retirement Funds Act, 2005 are protected at all times;
• Acting with due diligence, good faith and avoid conflict of interest;
• Acting with impartiality in respect of all members and beneficiaries;
• Trustees must ensure that proper registers, books and records of the operations of the retirement fund are kept, which include proper minutes of resolutions passed by the Board;
• Trustees must ensure the fund employs proper control systems;
• Trustees must ensure that adequate and proper information is communicated to members of the retirement fund informing them of their rights, benefits and duties in terms of the rules;
• The trustees must obtain expert advice on matters where they lack sufficient knowledge and
• The trustees must ensure that the rules, operation and administration of the retirement fund complies with the relevant legislation, including but not restricted to the Retirement Funds Act, 2005, the Financial Services Regulatory Act, 2010 and Income Tax Order, 1975