Investment Stewards of retirement plans (e.g. investment committee members, trustees) have a responsibility to monitor the advisors they have hired. CEFEX has the expertise to assist in this task. In other industries, product manufacturers mandate their suppliers to achieve ISO quality management system certification in order to ensure the highest level of quality assurance in their product. Isn't this what retirement plans should expect? Many retirement plans are now mandating the CEFEX certification of advisory firms.
Request for Proposal Template for use by Plan Sponsors
CEFEX and fi360 have developed a standard Request for Proposal (RFP) template, which can be used by Investment Stewards of 401(k) plans to select their advisory firms. CEFEX-certified advisory firms are very well prepared to respond to this RFP because many of the requirements have already been addressed in the CEFEX assessment.
This RFP is suitable for distributing to plans, as they have the responsibility to prudently select their investment advisor(s).
Download the template here.
CEFEX Advisors help Stewards Meet Regulatory Requirements
In the U.S. the Employee Retirement and Income Security Act of 1974 (ERISA), the Uniform Prudent Investor Act (UPIA), the Uniform Prudent Management of Institutional Funds Act (UPMIFA) and the Uniform Management of Public Employee Retirement Systems Act (UMPERSA) identify the responsibilities of retirement plan trustees (Investment Stewards). For example:
The 3(38) Investment Manager role
Often, retirement plans elect to seek general safe harbor protection (insulation from certain liabilities associated with investment decisions) by delegating discretionary investment authority to an ERISA Section 3(38) investment manager. CEFEX certified investment advisory firms that offer this safe harbor, as indicated in their scope of CEFEX certification, have been assessed on all of the associated ERISA requirements.