As a consultant, I sometimes hear the collective ‘sigh’ from investment and retirement plan committees when I get to the ‘fiduciary education’ piece of our meeting agenda. However, individual committee members bring different levels of experience and expertise as it relates to their role on the committee. As a result, it is critical that members receive periodic education on their fiduciary responsibilities, as well as on a variety of broad topics related to managing a retirement program.
Recently, there has been an increased focus on the importance of providing fiduciary education to investment and retirement plan committees. In the settlement of ERISA lawsuit Cates v. Columbia University, a non-monetary provision was included stating “during the Settlement Period, Defendant shall continue to provide annual training to the Plans’ fiduciaries regarding their fiduciary duties under ERISA.” In addition, and likely in response to concerns around litigation, some insurers have begun asking plan sponsors about the frequency and timing of fiduciary education as part of the renewal of their fiduciary liability coverage.
At a minimum, committees should participate in and document that members have reviewed and understand their fiduciary responsibilities to the plan and its participants. An annual review of the plan governance documents, such as a Charter and investment policy statement (IPS), is one way to ensure committee members are aware of their role and responsibility.
However, many plan sponsors go beyond this and introduce a variety of retirement plan-related topics to their committees. A robust fiduciary education program helps committees remain current on legal and regulatory information and plan design and investment option trends. Also, committees are much more engaged and avoid the ‘sigh’ when new and interesting topics are presented.
At Multnomah Group, we have a fiduciary training program created in-house and available to all of our clients. To learn more and see all the topics covered in our training, click here.
Multnomah Group is a registered investment adviser, registered with the Securities and Exchange Commission. Any information contained herein or on Multnomah Group’s website is provided for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Multnomah Group does not provide legal or tax advice.