American Electric Power and HNI are part of a growing trend toward including treasury and finance executives in overseeing the investment side of their 401(k) plans.
Financial executives had been involved with their companies' defined contribution plans when the investments were separate from the record-keeping and administrative functions that were handled by the human resources and benefits departments. When Fidelity Investments and other giant players stormed the record-keeping marketplace in the early 1990s with bundled products that included investments, many HR/benefits departments oversaw these bundled relationships.
Now, though, as investment options are getting more complicated and fiduciary responsibility for company stock has become a big issue, more treasury and financial departments are getting involved again.
Steven Kiser, director of trust and investments for Columbus, Ohio-based American Electric Power Co. Inc.'s $2.8 billion retirement 401(k) plan, said, "We work very closely with the HR group when evaluating funds."
AEP's treasury department was not always so involved with the 401(k) plan, said Mr. Kiser, adding its $3.5 billion defined benefit plan was the main area of focus for treasury. But as assets for the 401(k) plan grew, his department became more involved in the investment selection process.
Mr. Kiser said the 401(k) plan recently switched providers to JPMorgan Retirement Plan Services, Kansas City, Mo., from Fidelity Investments, Boston. That was one of the first major 401(k) initiatives in which his department was involved.
"The treasury department has more of a financial background and can bring more of a focus on fees and performance," said Mr. Kiser, adding that he sits on the company's 401(k) committee with other trust executives and human resources professionals.
"There is a lot of money at stake, and participants need the best choices for a good retirement," he said.