PLANSPONSOR - June/July 2021 - 37

BEST PRACTICES | PLAN COMMITTEES
Often a committee will include one
or more of these members of the management
team: the vice president of HR, the
chief financial officer (CFO) and/or the
director of compensation and benefits.
Typically, the president or CEO is not
included as a member because he may
have too many other significant responsibilities
and too little time. Moreover, if
the plan holds company stock, the chief
financial officer (CFO) may be excluded
to help avoid conflicts resulting from
stock knowledge he has that may not be
discussed under applicable securities laws.
Alternatively, a committee may appoint an
outside third-party fiduciary to make decisions
with respect to any company stock.
We generally recommend that the
company's general counsel not serve on
the committee. Instead, have that person
or someone in the legal department be
an adviser to the committee; this will
help preserve the attorney/client privilege
to the greatest extent possible. Once the
committee is selected, one person should
serve as chairman to oversee the meetings
and keep them on track.
Appointing, monitoring and replacing,
as necessary, the committee members is a
fiduciary responsibility. Whoever is responsible,
whether the board or its delegate,
committee member appointments should
be periodically reviewed. This means
the fiduciary should assess whether the
members continue to act appropriately-
i.e., attend meetings and actively participate
in committee decisionmaking. Further,
the fiduciary should be prepared to replace
members as people change jobs within or
leave the company.
Why Keep Minutes?
There is no legal requirement that you
keep plan committee minutes. However,
if you perform a thorough and prudent
review when making a fiduciary decision,
you must be able to prove this if
later challenged. Having someone such
as the secretary take minutes at each
meeting is your best evidence that you
followed a prudent process.
General guidance. Certain basic
information should always appear in
the minutes, including, for example, the
following:
* Meeting date - It seems basic, but if
the date is not included, you'll later have
no idea when the meeting was held.
* Meeting attendees - The minutes
should list everyone who attended-both
committee and non-committee members.
The minutes should also note that
quorum was met.
* Issues discussed (we explain the
level of detail under " Documenting
discussions " ).
* Materials reviewed - Copies of all
materials presented should be kept with
the minutes.
* Decisions made - This is a key point
to include.
* Action items - Any next steps should
be recorded so they can be addressed in
the next meeting. For example, if the
committee decides to put an investment
option on a watch list, this should be noted
so the investment can be reassessed when
the committee reconvenes.
Documenting discussions. The
minutes need not be long or provide a
detailed description of who said what
to whom. In fact, it is probably best to
exclude the specifics of a back-and-forth
debate. Instead, when the committee
considers a question, the minutes should
state the issue, what information or materials
were presented, and whether any
advice or guidance was provided by a
third-party adviser. The minutes should
note that committee members reviewed
and discussed the materials and recommendations.
The committee's ultimate
decision is also important to note-how
else would you know, referring back,
what the determination was? Finally, if a
committee member is against a decision
or abstains from the vote, the minutes
should reflect this.
General format. It can be helpful to
develop a general format for the minutes
to facilitate the process and create consistency.
When following a set format, the
Appointing,
monitoring
and replacing,
as necessary,
the committee
members is
a fiduciary
responsibility.
meeting secretary knows what information
to record each time. It also helps to
use the meeting agenda as a road map
for committee members, so topics to be
covered do not get overlooked.
When a committee is responsible
for more than one plan, it's a good idea
to have separate minutes for each, or at
least plan-by-plan separation within the
minutes. That way, if you must provide
minutes with respect to a plan-e.g.,
in response to a Department of Labor
(DOL) investigation-you can limit what
you produce to only the minutes for the
relevant plan.
Ultimately, the key point to remember
is that the minutes are evidence that the
committee acted prudently. They should
reflect the process the committee engaged
in-i.e., that information was presented,
reviewed and discussed in order for the
committee to make its decision.
What Does the Plan Say?
A frequently overlooked fiduciary duty
is that of acting in accordance with plan
documents to the extent consistent with
the Employee Retirement Income Security
Act (ERISA). Committee members should
be familiar with the terms of those documents
governing the plan, including the
plan document itself.
Keep in mind that the plan document
means the most recent restatement
plus any subsequent amendments that
PLANSPONSOR.COM June - July 2021 37
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PLANSPONSOR - June/July 2021

Table of Contents for the Digital Edition of PLANSPONSOR - June/July 2021

2021 Plan Sponsor of the Year Winners
2021 Recordkeeping Survey
The Right Provider Team
For the Best Collaboration
2021 PLANSPONSOR Service Stars
PLANSPONSOR - June/July 2021 - Cover1
PLANSPONSOR - June/July 2021 - Cover2
PLANSPONSOR - June/July 2021 - 1
PLANSPONSOR - June/July 2021 - 2
PLANSPONSOR - June/July 2021 - 3
PLANSPONSOR - June/July 2021 - 4
PLANSPONSOR - June/July 2021 - 5
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PLANSPONSOR - June/July 2021 - 7
PLANSPONSOR - June/July 2021 - 8
PLANSPONSOR - June/July 2021 - 9
PLANSPONSOR - June/July 2021 - 2021 Plan Sponsor of the Year Winners
PLANSPONSOR - June/July 2021 - 11
PLANSPONSOR - June/July 2021 - 12
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PLANSPONSOR - June/July 2021 - 21
PLANSPONSOR - June/July 2021 - 2021 Recordkeeping Survey
PLANSPONSOR - June/July 2021 - 23
PLANSPONSOR - June/July 2021 - 24
PLANSPONSOR - June/July 2021 - 25
PLANSPONSOR - June/July 2021 - 26
PLANSPONSOR - June/July 2021 - 27
PLANSPONSOR - June/July 2021 - 28
PLANSPONSOR - June/July 2021 - 29
PLANSPONSOR - June/July 2021 - 30
PLANSPONSOR - June/July 2021 - 31
PLANSPONSOR - June/July 2021 - The Right Provider Team
PLANSPONSOR - June/July 2021 - 33
PLANSPONSOR - June/July 2021 - 34
PLANSPONSOR - June/July 2021 - 35
PLANSPONSOR - June/July 2021 - For the Best Collaboration
PLANSPONSOR - June/July 2021 - 37
PLANSPONSOR - June/July 2021 - 38
PLANSPONSOR - June/July 2021 - 2021 PLANSPONSOR Service Stars
PLANSPONSOR - June/July 2021 - 40
PLANSPONSOR - June/July 2021 - Cover3
PLANSPONSOR - June/July 2021 - Cover4
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https://www.plansponsordigital.com/plansponsor/october-november_2020
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https://www.plansponsordigital.com/plansponsor/june-july_2018
https://www.plansponsordigital.com/plansponsor/april-may_2018
https://www.plansponsordigital.com/plansponsor/february-march_2018
https://www.plansponsordigital.com/plansponsor/december_2017-january_2018
https://www.plansponsordigital.com/plansponsor/november_december_2017
https://www.plansponsordigital.com/plansponsor/october_2017
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