This year, in particular, with the protests that sprung up across the country following the death of George Floyd, has shown many companies the importance of having a truly diverse workforce. And that principle should extend to the retirement plan committee as well as the workforce, experts say.

While having a diverse committee is ideal, the first thing plan sponsors should do is select experts to sit on the committee, says Timothy Irvin, a director and corporate markets practice leader at Cammack Retirement Group.

That would include people from finance, benefits, human resources (HR) and operations, Irvin says. “First and foremost, it is an expert group,” Irvin says. “It is not worth sacrificing knowledge because this committee makes decisions on behalf of plan participants and their beneficiaries.

The committee needs to be capable, first and foremost, and, secondly, representative of the institution.” Those experts might include the chief executive officer, the chief financial officer, the vice president of finance, the treasurer, the chief benefits administrator, the head of HR or someone from payroll, Irvin says.

As far as diversity is concerned, companies should “make sure different areas of the company are represented on the committee,” Irvin says. “A lot of the committees we work with are diversified. We help our clients with this by benchmarking the typical roles on committees and sharing this information with clients.” Dannae Delano, a partner with The Wagner Law Group, agrees with Irvin that having a diverse retirement plan committee is an important consideration.

“Traditionally, the thinking has been focused on people with the right expertise, that is, representatives from the financial, HR and legal departments,” Delano says. “Those are all still important, but as workforces are becoming more diverse—culturally, generationally, by ethnicity and by gender—it is also important to have the committee represent this more diverse workforce.” Having a committee that is more representative of employees results in participants better understanding the plan—and, potentially, better retirement outcomes, Delano says.

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