Employers

Employers who sponsor a retirement plan for their employees have the intention of providing an extremely valuable service. The employer-sponsored retirement plan is often the most important savings vehicle for an individual and can determine how comfortable that individual's golden years will be.

The plan sponsor and the individuals who participate in the various committees to run the plan, such as the investment committee are investment stewards. They are responsible for managing the money of others.

The US Department of Labor defines their basic responsibilities as:

To run the plan solely in the interest of participants and beneficiaries and for the exclusive purpose of providing benefits and paying plan expenses. Fiduciaries must act prudently and must diversify the plan's investments in order to minimize the risk of large losses. In addition, they must follow the terms of plan documents to the extent that the plan terms are consistent with the Employee Retirement Income Security Act (ERISA). They also must avoid conflicts of interest. In other words, they may not engage in transactions on behalf of the plan that benefit parties related to the plan, such as other fiduciaries, services providers or the plan sponsor.