Defined Contribution

Callan Survey Unearths DC Governance Committee Productivity Hacks

Callan Survey Unearths DC Governance Committee Productivity Hacks
clock
1 min 57 sec

The governance committees that oversee defined contribution (DC) plans have a lot on their plate, and knowing how to make the most efficient use of the resources at their disposal is not always apparent. Effective governance of the DC plan helps employers meet fiduciary responsibilities, abide by regulatory requirements, and minimize the risk of litigation and negative press. And the stakes are higher than ever given the increasing complexity of DC plan requirements, as well as ongoing lawsuits over issues ranging from fund selection, plan fees, and overall plan monitoring and evaluation. A recently published Callan survey lays out a blueprint for investment committees to make the most of their time and energy.

To help plan sponsors better understand good governance practices, including how their peers are structuring their oversight committees, Callan fielded the DC Plan Governance Survey among large plan sponsors in May 2017. Our survey identified ways in which committee structure, composition—and even the number of meetings and those responsible for meeting agendas—have important implications for the priorities, challenges, and effectiveness of DC plan governance. Our findings reaffirmed our view that a properly structured and resourced committee serves as a critical foundation on which a DC plan thrives.

Other key findings of our survey include:

  • Large plans preferred to split the difference: Plans with higher participant counts were more likely to have separate committees—administrative and investment—than smaller plans, which were more likely to have a single committee.
  • Size matters: Across committee types, poor participation and clarity around roles corresponded with a higher-than-average number of committee members.
  • Improving the odds: Investment and administrative com­mittees with an even number of committee members were more likely to report challenges with strained internal resources.
  • Fiduciary training isn’t a given: While most committees reported annual or at least periodic fiduciary training, nearly one in seven respondents from single committees noted no fiduciary training had been done.
  • The hand that rocks the cradle rules: The party responsible for setting the agenda influenced the committee’s priorities (i.e., staff vs. committee head).
  • Committees tend to work: In general, respondents viewed their committees as highly effective.
Exhibit 2: Average Size by Committee Type

Find the full survey results here. For more coverage of defined contribution plans, including return data and asset flows, please view our DC IndexTM here.

106

Number of organizations that responded to Callan’s Governance Survey

Posted by

Share
Share on facebook
Share on twitter
Share on linkedin
Related Posts
Operations

Inaugural Study Reveals How Asset Managers Incorporate DEI into Their Core Business

Laura Dawson
Callan's 2024 Asset Manager DEI Study examines how investment managers approach diversity, equity, and inclusion (DEI) in their own firms.
Operations

Unlocking the Secrets of the 'Data Vault'

Bo Abesamis
Bo Abesamis describes the Callan "Data Vault," a repository where data is collected, cleansed, aggregated, and curated.
Operations

Financial Wellness: Is It the Right Prescription for Your DC Plan?

Jana Steele
Jana Steele provides a summary of her recent white paper on financial wellness options for DC plans.
Operations

DOL Proposes Tightened Proxy Voting Guidelines

Patrick Wisdom
The department’s new proposal dovetails with SEC guidance finalized in 2020 and would create a refined set of circumstances in which plan fiduciarie...
Operations

Fine-Tuning Implementation of the CARES Act

Jana Steele
The IRS has issued two notices and a FAQ to clarify how defined contribution (DC) plan sponsors should implement the provisions of the act, touching o...
ESG

DOL Calls for Stricter Rules Around ESG Investing in Retirement Plans

Thomas Shingler
Operations

Our DC Index Had a Noteworthy First Quarter

Patrick Wisdom
Operations

DOL Issues Common-Sense Information Letter About Private Equity in DC Plans

DC Consulting Group
Operations

Callan Survey: DC Plan Response to CARES Act Varied by Industry and Recordkeeper

Jana Steele
ESG

‘Social Washing’ and How COVID-19 Has Emphasized the ‘S’ in ESG

Aaron Quach

Callan Family Office

You are now leaving Callan LLC’s website and going to Callan Family Office’s website. Callan Family Office is not affiliated with Callan LLC.  Callan LLC has licensed the Callan® trademark to Callan Family Office for use in providing investment advisory services to ultra-high net worth clients, family foundations, and endowments. Callan Family Office and Callan LLC are independent, unaffiliated investment advisory firms separately registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940.

Callan LLC is not responsible for the services and content on Callan Family Office’s website. Inclusion of this link does not constitute or imply an endorsement, sponsorship, or recommendation by Callan LLC of their website, or its contents, and Callan LLC is not responsible or liable for your use of it. When visiting their website, you are subject to Callan Family Office’s terms of use and privacy policies.