However, when I was writing about these issues there seemed to be a significant consensus that, in order to meet these demands, at least in part, a good pension system should be based on three pillars: first, a tax-financed public plan that provides a flat-rate or means-tested basic pension; second, a mandatory occupational or private (but publicly regulated) funded pension scheme; and third, a voluntary pension saving scheme, often with tax incentives. Three pillars, rather than one, are needed in order to accommodate the tradeoffs between goals, make the overall system more resilient to different types of shocks, and  1  The main article referred to can be found http://www.sedlabanki.is/uploads/files/mb011_5.pdf. 2  The speech can be found on the http://www.sedlabanki.is/uploads/files/MB041_7.pdf. BIS Review 63/2010  on  the Central  Central Bank  Bank of  of  Iceland Iceland  website: website:  1  provide for flexibility and choice. This is, of course, familiar to most of you here, and an excellent – by now, almost classic – presentation can be found in the 1994 World Bank publication: Averting the Old Age Crisis. By the turn of the century, the Icelandic pension system had taken on many of these attributes. The public pension system provided a low basic pension but a much higher supplementary pension that was, however, means-tested, also against pensions from other sources. This meant that, as the occupational or second-pillar pension funds matured, the public pension would dwindle in relative terms.
An example is the Risk Management & Corporate Governance Programme, conducted with SPRING Singapore. 2  BIS Review 164/2010  19. SID can do much more in this respect. SID should be sensitive to the current needs of directors and fine-tune the content of its courses accordingly. In addition, SID can better engage experienced directors, and tap on their expertise through putting together relevant case studies. Conclusion 20. Ladies and gentlemen, with increasing expectations on directors, companies will come to place a premium on well-trained, ethical directors who look out for the interests of all stakeholders, and are not rubber stamps for management decisions. This presents an opportunity to directors who are proficient and professional. 21. It is in companies’ and directors’ best interests to “Get it Right” by having effective and committed directors who pursue good corporate governance practices, as this will result in a premium for shareholders. Grooming such directors will help to encourage new ideas, better practices and encourage leadership renewal for company boards. 22. On this note, I would like to end by thanking SID for its efforts in the area of corporate governance. I hope that the discussions arising from this conference will help directors gain a better understanding of how they can carry out their duties more effectively. 23. Thank you and have a pleasant day ahead. BIS Review 164/2010  3