Life as a member of your company’s retirement plan com- mittee, and a fiduciary under the Employee Retirement Income Security Act (ERISA), is certainly becoming more
challenging. In our December 2016 column we encouraged you
to review the governance structure of your company’s retirement
plan and your role in it. In our January column, we discussed who
should be part of the retirement plan committee, and in February
we focused on when the committee should meet and the topics to
cover. In this column, we address how plan committee members
should act, and we suggest standards by which
to review their performance.
An effective retirement plan committee
needs engaged and interested members.
Usually, committee members are appointed
by the board of directors or by its designee—
often the CEO. Plan sponsors need to look at
the company’s retirement plan documents—
typically the summary plan description (SPD)
and committee charter—to confirm who has
the authority to make these appointments.
Whoever has this duty also likely has the
ongoing responsibility to monitor his appointees’ performance
and to replace them when they step down.
How does a committee member know if he is properly
enacting his role? In addition, we are often asked, how should
the board or CEO evaluate the performance of the individual
committee members? The questions below provide some stan-
dards by which to measure:
• Does the member routinely attend all regular and special
meetings on a timely basis, missing them or arriving late only
occasionally and when absolutely necessary?
• Does the member thoroughly review all materials and
handouts circulated before the meeting and come prepared with
any questions, ready to discuss the subject matter?
• Does the member participate meaningfully in discussions
and deliberations with fellow members?
• Does the member consistently analyze fiduciary issues,
keeping an exclusive focus on the best interests of the plan
participants and beneficiaries and without regard to any ulterior
motives or factors?
• Has the member made it a priority to understand the
terms of the plans’ governing instruments, as well as charters,
• Does the member work effectively with his fellow
members, treating them with respect and showing an apprecia-
tion for their concerns?
• While showing respect for the opinions of others, does the
member analyze issues and problems independently and try to
avoid group think?
• Is the member willing to ask tough questions of the many
service providers to the plan and to avoid merely rubberstamping
In addition, it may be helpful to the effec-
tive performance of each individual retirement
committee member, and to the operation of
the committee as a whole, to keep in mind the
• Periodically, each member’s perfor-
mance should be reviewed, confidentially, with
the chairman of the committee. The chairman
should be evaluated by whoever appoints,
• Each member should identify potential educational areas
that he would like to pursue in the coming year and then deter-
mine how he will receive such education. That exploration can
be aided by adding “committee education” as a regular agenda
item—i.e., as part of your annual committee work plan.
• An environment should be fostered where each and
every member, regardless of experience level, feels comfortable
suggesting further process enhancements.
• A focus on identifying potential committee member
candidates should be maintained, as necessary, to replace
resigning members, taking into account candidates’ professional and educational credentials, job performance and likely
ability to bring new perspectives to the table.
• Underperforming members should receive constructive,
confidential feedback and be removed if performance fails to
Summer Conley is a partner in the Los Angeles office of
Drinker Biddle and Reath LLP, and Michael Rosenbaum is
a partner in the firm’s Chicago office.
your plan committee members