The concept of ‘governance’ could not be timelier. In the non-ERISA world, plan sponsors are charged with managing a plan that they often know very little about, especially within the multi-provider, separate recordkeepers construct. Well-meaning investment providers are often presumed to care more about their bottom line than being trusted as a partner in benefit solutions. That stigma trickles down to boots on the ground advisers, often viewed as salespeople versus true financial consultants. Compounding the frustration is the negative press targeted at these plans, highlighting poor participation rates amongst a slew of other criticisms – all fueled by an extreme lack of information.

There’s a movement among thought leaders in the governmental retirement plan space who are looking for more modern plan solutions. Recognizing that a Master Recordkeeper approach is a viable alternative, plan sponsors can examine their plan more thoroughly and be flexible and adaptable to the nuances of their plan needs, whether multi-provider, single provider, multi-advisor, or agent distributor. A plan governance program takes into account the employer’s goals and objectives, determining what you want your plan to look like, and evaluating the quality of options available to employees. Plan consultants and advisors can help the plan sponsor determine what market segment they’re in, the fees they’re paying, and what provider licensing and accreditation should look like. From there, a custom solution can be built, curating provider products that make sense for your plan, and updating policies like solicitation agreements to better protect employees from potentially unscrupulous or unqualified salespeople.

Whether the governance issue is approached from the need-based, risk management perspective of preventing harm, or from a true desire to help, plan sponsors can make a profound improvement for plan participants by implementing a documented plan governance process.

The Final Step

Building a well-designed, operationally-compliant, participant-focused plan is only the beginning of governance. The most often overlooked component of effective plan management is also the most critical element of governance: enforcement. Enforcement is holding all service providers accountable, monitoring plan performance, enforcing solicitation protocol, and requiring higher standards of practice to best serve participants.

As a Plan Sponsors, you may be looking for ways to support your employees and help them build a more secure financial future. Supplemental retirement plans are one benefit area where there is significant room for improvement. A plan governance structure enables financial security for plan participants today, tomorrow, and the years to come.

The industry now has the tools and technology to document and review the plan management process on an ongoing basis and put into practice the next level of best practices in one simple platform, especially by utilizing innovative approaches such as a Master Recordkeeper. With a well-organized plan governance program in place, you will have the clarity, transparency, and accountability to best serve participants in a way that’s never been done in governmental plans.

The time has come for the next step in the evolution of non-profit and governmental plans. By engaging plan sponsors in the quality of the plans, offering innovative, effective investment products, building partnerships with advisors as consultants, and demonstrating the desire to help employees succeed, we all work together for a greater good. The next step is an administrative ecosystem that utilizes a Master Recordkeeper approach, providing a direct line of sight to the totality of plan activities, creating a modern plan ready for 2023 and beyond.

This series was created for plan sponsors, TPAs, plan consultants and advisors and others involved in managing non-ERISA retirement plans. IPX Retirement provides recordkeeping, IRA, trust & custody, and lifetime income solutions to the retirement plan industry. For more information on the IPX Retirement Plan Governance Program, contact your plan advisor or IPX Retirement representative or visit ipxretirement.com/pgp.