Risk management and automation are among retirement benefit issues employers are likely to focus on this year, a new report says.
Among changes making an impact on retirement plans this year are recent legislation, tighter reporting and funding, and the gradual shift of risk from employers to employees, according to a new survey by Hewitt Associates, Lincolnshire, Ill., a human resources consultant and administrator.
Hewitt’s study of 190 mid- to large-sized U.S. companies finds new funding rules for pensions and increased scrutiny of retirement plans, in general, are prompting more companies to take extra steps to manage risks for their plans in 2008.
Among companies offering pension plans, 63% said they are very likely to perform funding and accounting projections, 30% plan to perform an asset liability study and 29% are very likely to assess the risks that their pension plans are running based on current strategies.
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Among companies offering a defined-contribution plan, 55% intend to review their fund operations including expenses and revenue sharing. Also, 35% say they are very likely to review their 401(k) plan governance structure or hire a third-party monitor to review their investment options, in order to meet their fiduciary responsibilities.
At the same time, 56% rank employees’ taking accountability for retirement as a high priority this year, and 50% plan to focus on helping employees better understand their retirement benefits.
Much of their efforts will be carried out through communications with 66% of employers saying they are very likely to undertake a communication program on 401(k) plan participation, and 64% are likely to communicate to their employees about diversification and fund usage. In addition, 58% plan to focus their communication efforts on 401(k) contribution levels.