401(k)ology – Plan Governance: Plan Sponsor vs. Fiduciary and Committee Roles and Responsibilities

Summary

With increasing frequency, we are asked who has the responsibility for specific retirement plan oversight. Depending on the size of your company, who is responsible may be just the owner of a small business or there may be specific teams or committees assigned to tasks in larger entities. Certain parties will inevitably wear multiple hats, acting on behalf of the employer (settlor functions) and on behalf of the plan as a fiduciary. The roles of the plan sponsor and of the plan fiduciaries can be hard to distinguish and, in certain functions, can overlap. In this article, we will help you decipher just who is responsible for what so that an effective governance structure can be developed and maintained.