Investment Policy Statement
(Defined Contribution Plan)

Summary

This template is an investment policy statement for a defined contribution retirement plan subject to ERISA . Although not legally required under ERISA, written investment policies are generally considered a best practice to promote the plan investment fiduciary's compliance with ERISA's broad fiduciary obligations. This template contains practical guidance, drafting notes, and alternate and optional clauses. An investment policy statement provides the responsible fiduciaries with written guidelines to provide a framework for decision making regarding plan investment selection, management, and oversight and related issues. Such policies should have sufficient flexibility in implementation to be proactive and responsive to changing circumstances so as to support the likelihood of investment success on an ongoing basis. Ideally, the investment policy ensures that investment decisions are made in a prudent manner and in accordance with ERISA and the plan document and policies. For a full listing of key content that can be used by in-house counsel to develop, revise, and implement a company's employee and third-party-related policies, see In-House Company Policies Resource Kit. For a full listing of key content for in-house counsel and corporate secretaries when performing corporate functions, see In-House Corporate Secretary Resource Kit. For additional information on ERISA's fiduciary obligations generally, see ERISA Fiduciary Duties. For a broader discussion about investment committee issues, including their use of an investment policy statement, see Investment Committee Issues for Defined Contribution Plans including the section on "The Investment Policy Statement (IPS)." See also Investment Committee Charter (Defined Contribution Plan) and other investment fiduciary-related resources in the ERISA Retirement Plan Investment Resource Kit. For a full listing of key content covering 401(k) and other defined contribution plan compliance, see 401(k) and Other Defined Contribution Plan Compliance Resource Kit.