Many Sponsors Unaware of Fiduciary Responsibilities
In
the past three years, there has been a decline in retirement plan sponsors’
awareness of their fiduciary responsibilities, according to research from
AllianceBernstein. More than one-third (37%) of sponsors aren’t aware that
they are fiduciaries, up from 30% in 2011.
“There’s a clear correlation between a lack of fiduciary awareness and plan
sponsors that are less concerned with increasing employee engagement and
protection in retirement plans,” says Dick Davies, senior managing director of
AB’s defined contribution business and co-head of North American
Institutions.
The survey also found that the use of target-date funds (TDFs) is rising, and
those sponsors that use target-date funds take fiduciary concerns more
seriously; 87% of sponsors with TDFs said fiduciary concerns were important or
very important.
“What’s comforting is that the adoption of target-date funds is rising, and
plan sponsors and participants alike want more innovative products that are
changing the retirement outcomes for plan participants,” Davies says. “These
include guaranteed income TDFs, multi-manager funds and other customization
options available in the DC marketplace.”