PLANSPONSOR - December/January 2020 - 12

UPFRONT
Time to Benchmark Your Adviser?
JUST as plan sponsors should periodically
benchmark the services of their
recordkeeper, third-party administrator
(TPA) and asset management firms, they
should also benchmark the services of
their consultant or adviser, experts say.
Surprisingly, however, " there are
many sponsors that started working with
an adviser as much as 20 years ago and that
have never benchmarked them, " says Steve
Wilt, senior vice president and a financial
adviser with CAPTRUST. Among advised
plans, roughly 20% of the advisers do not
act as a co-fiduciary, and 25% lack the
expertise, he says. " If sponsors were diligent
about benchmarking their advisers,
they might discover [those people] are not
experts on retirement plans. "
So, where should a plan sponsor
start? " There's a cottage industry of
independent third-party specialists and
ERISA [Employee Retirement Income
Security Act] attorneys that can help
sponsors conduct formal RFPs [requests
for proposals] on their advisers, " says Paul
Sommerstad, a partner at Cerity Partners.
" Most sponsors are benchmarking advisory
fees and services on an annual basis. "
A few specialist companies that perform
these functions are Curcio Webb, North
Pier Consulting, InHub and Wagner Law
Group, Sommerstad says.
Moreover, as sponsors continually
ask more from their adviser, it becomes
increasingly important for them to
monitor whether these services are being
satisfactorily delivered, Sommerstad says.
Thus, for any benchmarking exercise
to lead to informative results,
the sponsor needs to first determine
what outcomes it wants an adviser
to provide, says Bob Carroll, head of
workplace distribution at MassMutual.
Sponsors that want to conduct an RFP
on their own can narrow the search down
to three or four retirement specialists,
or those he calls " elite advisers, " adding
that some sponsors make the mistake of
including generalists in their search.
" Another way is to identify the top
advisers in your area and invite them in
for an interview, " Carroll says. " You don't
necessarily have to go through the paper
process of an RFP. Ask them how they plan
to make an impact on the plan to benefit
participants. Ask them for a quote and a
proposal, and document that process. "
Craig Rosenthal, senior vice president
of adviser sales and service at
Fiduciary Benchmarks, says when his
firm analyzes the services of advisers, it
SURVEY SAYS
Checked Out on the Job
Our readers say the top reason by far to disengage with
their job was lack of manager appreciation. But, of course,
a combination of factors can contribute to employee
disengagement.
Unappreciative management
Poor employee/manager communication 21%
Nothing new to learn 10%
Loss of interest in the work 10%
Poor workplace relationships 6%
Inadequate pay 4%
Too much work 2%
Poor work/life balance 2%
No way to move up 2%
Poor benefits or no benefits 0%
Personal reasons unrelated to work 0%
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44%
considers four factors: quality, service,
value and extra credit.
" Quality is: Who is the adviser? "
Rosenthal says. " What credentials does
he have? How much insurance coverage
does he have? Services cover the things
the adviser actually does. Does he take
on fiduciary status? How many meetings
does he hold a year? Value is the results he
delivers. What types of participant success
measures does he achieve? Extra credit is
what extra work or hours does he offer?
The combination of these four things leads
to quality benchmarks. " -Lee Barney
12 PLANSPONSOR.COM December 2019 - January 2020

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PLANSPONSOR - December/January 2020

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