Time To Make Time
bids for services. You have a fiduciary responsibility to
evaluate the plan’s needs and search for the most suitable
service providers with the most reasonable cost. This RFI is
a ‘live’, ‘go-to-market’ exercise designed to provide a plan
sponsor and fiduciary with the most current pricing data
while outlining new and improved services and tools for plan
participants they may not be aware of. Not only does this
allow plan sponsors to provide participants with a better plan,
but should the DOL’s law-enforcement arm—the Employee
Benefits Securities Administration, or EBSA—come calling,
the plan and plan fiduciary has proof they are fulfilling their
fee disclosure duties and have demonstrated a fiduciary
process and fiduciary prudence. Just as importantly, the
plan sponsor can use this process to negotiate with providers
for better pricing.
Fee disclosure is all well and good as long as plan fiduciaries
take an active role and recognize the need for the extra step
to actually examine and perform an analysis of the plan. By
taking the time to hire an outside expert, a plan fiduciary
has proactively made a decision to protect themselves from
liability and fulfill their moral duty to create better plan
outcomes for their participants.
Thus far, we have focused on plan fees and the liability
associated with NOT actively assessing them; just as
importantly, a plan’s fiduciary governance structure and
procedures should be reviewed and monitored as well. There
must be time made for Fiduciary committees to enforce
good and sound fiduciary processes. Plan fiduciaries and
their committees are strongly recommended to hold regular
meetings and keep accurate records of all matters discussed.
When significant decisions are made, those decisions should
be documented, and any alternatives considered should
be described. Finally, all appointing fiduciaries should be
reviewed as well.
So while plan fiduciaries often get distracted, side tracked,
and overwhelmed by the stacks of papers on their desks; while
their inbox grows, time must be made to assure the plan’s needs
are being met in a competent, efficient, and price conscious
manner. The solution is to engage in outside, independent
experts, who can assist and partner with a plan’s fiduciary
to make the best, freshest, and most delicious “donuts”. n
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