Mercer Encourages Greater Partnership with Advisers

Advisers can help retirement plan sponsors with the task of creating the most effective plan for participants and maintaining a plan compliant with various regulations.

Mercer’s latest Retirement, Risk & Finance Perspective, “DC Plan Management: Co-Sourcing Trends,” contends that what it calls “co-sourcing” provides an effective means to meet the higher standards imposed on sponsors, and addresses the organizational risks presented by defined contribution plans.   

Under the co-sourcing model, an adviser plays an inside role, side by side with the plan sponsor, often acting as an extension of the sponsor’s staff. As insiders, advisers have access to details and background information that may allow them to proactively identify problems and risks–and potentially avoid problems before they develop.  

As an example, Mercer mentions that including an adviser in recurring administrative conference calls can help ensure the plan sponsor’s interests are supported. The adviser can help the plan sponsor know when it should and should not push its vendor. Adviser assistance can also be critical when engaging a new provider or updating an existing relationship.  

In addition, mergers, spin-offs, changes in benefit structure or administration and turnover in benefits staff are all areas of potential risk that can be effectively addressed with the help of an adviser.  

The Perspective paper illustrates the co-sourcing model for different areas of plan management.  

The paper can be found here.