The life of a trust director

In this Q&A, Guernsey-based Relationship Director, Donna Shorto explains what the role of a trust director entails along with the unexpected benefits and challenges of the role.

Can you describe a day in the life of a trust director?

Life as a trust director is incredibly varied and dynamic, so no day looks the same, meaning you are required to be adaptable to all types of situations. There are often unforeseen matters that need to be addressed, such as changes in beneficiary circumstances, legal matters to be considered, regulatory updates or geopolitical changes which involve collaborating with relevant parties as well as my team to reach informed decisions that align with the trust’s objectives and legal requirements.

I generally start my day by going through emails and prioritising urgent matters to ensure timely responses and actions are taken. Part of my role is to oversee structures that include investments, so I will be reviewing the latest financial market updates and any news or updates that might impact my clients. Whilst we do not provide investment advice to our clients, being up to date with the latest market movements is essential to being proactive about investments and ensuring action is being taken by the appropriate appointed representatives.

Alongside the above, I will generally spend my day dealing with beneficiary requests, liaising with advisers, approving payments, discussing the performance of structures and generally engaging with our clients to ensure we have an up-to-date understanding of their needs or concerns.

I have an extremely varied portfolio of clients, both in respect of asset class and geographical location and therefore every structure is unique and requires a different skillset to ensure it is being managed most effectively.

However, not all the work required is client-facing and a large part of the role is ensuring that all of our structures are regulatory compliant and that all of our trust records are current.

Finally, I also sit on the board of Praxis Guernsey, so I am involved and responsible, alongside my other Board members, for determining our business strategy and long-term planning goals as well as ensuring that any areas of development or improvement are given the appropriate focus.

What are the most challenging parts of being a trust director?

One of the most challenging aspects of being a trust director is balancing the diverse and often competing interests of our clients while adhering to our fiduciary duties as well as balancing workload.

Beneficiaries often have different financial needs, expectations and goals, and ethical dilemmas along with sensitive family dynamics whereby disagreements can also arise. Possessing a high level of emotional intelligence and patience is essential in helping to navigate these family dynamics, mediate conflicts, provide support during difficult times and maintain harmony. Maintaining objectivity while being empathetic and ensuring fair and impartial treatment is an important part of the role.

Understanding and navigating the complex legal and regulatory requirements is a demanding part of the role. We are also committed (and duty-bound) to continued professional growth, and to keeping up to date with developments in the fiduciary space in terms of changing laws, compliance, tax regulations, estate laws, trustee duties etc. Our in-house legal counsel and tax specialists at Praxis ensure our client directors have direct access to advice and guidance, which is a significant benefit for us and our clients (although it is important to note that Praxis does not provide tax advice).

Despite these challenges, being a trust director is a highly rewarding role that offers the opportunity to make a meaningful impact on the lives of beneficiaries.

What are the most surprising or unexpected aspects of being a trust director?

People often assume that the role is based on financial and legal tasks, but the interpersonal dynamics often take centre stage and the depth and variety of personal relationships involved can be surprising.

Developing close relationships with beneficiaries is often more significant than you would think, but our role is to understand their background, values and goals to ensure effective trust management that fits their requirements. The role requires a broad range of knowledge beyond finance and law, including an understanding of psychology (including determining mental capacity in some instances) as well as an understanding of all types of asset classes and jurisdictional complexities. It is a much wider-ranging role than it was when I first started in the industry and does require you to be knowledgeable in many different areas.

Trust directors also often find themselves in an educational role, helping beneficiaries understand complex financial concepts, trust terms, and the implications of their decisions. This teaching aspect can be unexpectedly rewarding.

What do you find most rewarding about your role as a trust director?

The long-term impact of decisions we make as trustees can be profound, and the responsibility for shaping the financial future of beneficiaries and ensuring the longevity of the trust requires a thoughtful, strategic approach that I enjoy.

More than ever, young people are coming into huge amounts of wealth that they may not know how to handle at such a young and vulnerable age, and it is our job to help both parents and children find a structure that suits their needs and provides wealth protection until they are financially aware enough to manage their assets themselves.

I also appreciate how multifaceted the role is - it goes beyond financial stewardship and encompasses personal relationships, crisis management, education, and a broad spectrum of knowledge and skills.

Further information

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Please note that this article is intended to provide a general overview of the matters to which it relates. It is not intended as professional advice and should not be relied upon as such. Any engagement in respect of our professional services is subject to our standard terms and conditions of business and the provision of all necessary due diligence. © Praxis 2023