Retirement Plan Committees that Display Bad Behavior May Pay the Price. Many companies use a Retirement Plan Committee structure to oversee the tax-qualified retirement plan.
The knowledgeable plan sponsor is well aware, the operations functions and the investment management processes each have a high number of tasks each requiring flawless execution. Some of these tasks are repeated with each payroll and some tasks are only required to be completed once per year.
There are many benefits associated with establishing a Retirement Plan Committee. Today’s video on 401kTV will address some of the bad behavior that can easily be overlooked when in a committee setting. Sometimes overlooking bad-behavior can be costly.
This 3-minute video describes the fiduciary Warning Signs that were present at a pre-bankruptcy ENRON – specifically, the behaviors that went unchecked. This resulted in mistakes being made. Mistakes that led to a sophisticated and expensive – $1.5 Million – education for each the company’s outside directors and a select group of ENRON’s Human Resources professionals.
It is easy for the plan fiduciaries of today to chant in unison, “We’re no ENRON!” And that is certainly a true statement. However, the follow-up question to that retort is always the same. “Are you certain that you are not guilty of managing your own retirement plan with the same behaviors that were present at ENRON?
