An Employer’s decision to sponsor a retirement plan typically brings with it certain fiduciary responsibilities under the Employee Retirement Income Security Act of 1974 ("ERISA").
These responsibilities include:
The selection and monitoring of service providers for your plan such as recordkeeper, administrator, trustee and custodian, along with their respective fees’ reasonableness.
The selection and monitoring of brokers, consultants, investment advice service providers, along with monitoring associated fees.
The selection and monitoring of investment managers, investment options available in the plan, along with monitoring of investment expenses.
Under most retirement plan platforms available in the market today, the trustee does not have discretionary authority over the investment of plan assets. Instead, the trustee is a so-called “directed trustee,” meaning that another fiduciary, such as the employer, has responsibility for directing the trustee as to the investment of plan assets. In such cases, the employer retains the fiduciary responsibility under ERISA for investments.
Through its unique design, the Program provides employers with the highest standard of investment fiduciary protection under ERISA.1
| Typical Plan Trustee | Directed Trustee | Discretionary Trustee | ||
|---|---|---|---|---|
| ✔ Fiduciary liability to your firm | No Outside Fiduciary | Section 3(21) Fiduciary | Section 3(38) Fiduciary | ABA Retirement Funds Program |
| FIDUCIARY ACTS AND DECISIONS | RESPONSIBLE FIDUCIARY | |||
| Adoption and continued use of a plan provider | ✔ | ✔ | ✔ | ✔ |
| Selection and periodic monitoring of trustee, investment manager, and recordkeeper | ✔ | ✔ | ✔ | 
|
| Selection and monitoring of all service providers, including the investment advice service providers to participants | ✔ | ✔ | ✔ |
|
| Development and maintenance of Investment Policy2 | ✔ | ✔ | ✔ | 
|
| Selection, termination, and monitoring of all fund managers and investment options consistent with the Investment Policy2 | ✔ | ✔ | Investment Manager |
|
| Monitoring of all investment manager purchase/sale activity for compliance with investment guidelines | ✔ | ✔ Investment Advisor | Investment Manager |
|
| Determining applicability of, and compliance of fund investment line-up with, certain ERISA requirements including prudence, broad range, and sustainability | ✔ | ✔ Investment Advisor | Investment Manager |
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Watch this video to learn more about the Program's approach to fiduciary oversight and our service providers!
1For more information about the Program’s investment fiduciary oversight, refer to the Annual Disclosure Document (2025) – “ERISA and Fiduciary Obligations”
2Subject to acceptance by ABA Retirement Funds