Executives of five defined contribution plans were honored Monday with Excellence & Innovation Awards at Pensions & Investments' West Coast Defined Contribution conference.
This is the eighth year P&I and the Defined Contribution Institutional Investment Association have recognized best and new practices to enhance plan participants' retirement security.
Judges this year also awarded two honorable mentions — to a plan executive and a trade association that represents government defined contribution plans.
The innovation winners are:
- Mary Moreland, executive vice president, human resources, Abbott Laboratories, Abbott Park, Ill. The company's Freedom 2 Save Plan is a unique effort help employees save for retirement while paying off student debt. If employees devote 2% of their annual salaries to student debt payments, Abbott will contribute 5% of their salaries — the equivalent of the company match — to their 401(k) plan accounts. Abbott needed a private letter ruling from the Internal Revenue Service to offer this program.
- Hugh Penney, senior adviser for benefits planning, and Kate Castello, associate director for retirement planning, Yale University, New Haven, Conn. As part of a dramatic restructuring of its defined contribution plans, Mr. Penney and Ms. Castello supervised the creation of a qualified default investment alternative called Target-Date Plus, which not only provided three risk profiles for each target-date vintage but also incorporated a guaranteed lifetime income option into the QDIA. Yale re-enrolled all participants in all plans into the QDIA, and the overwhelming majority have stayed with the QDIA.
The excellence award winners are:
- Lisa Joe, director of retirement programs and services, and Jason Culp, retirement plan manager, for the Board of Regents, University of Georgia, Atlanta. They managed a massive restructuring of the university's defined contribution system, which included consolidating record keepers, simplifying investment lineups and creating a single online portal for multiple DC plans. To help ensure a successful launch, they drove more than 3,900 miles throughout the state in just over two months. They visited 42 university campus locations and coordinated more than 80 retirement plan presentations.
- Cindy Rehmeier, manager of defined contribution plans, Missouri State Employees Retirement System, Jefferson City. By frequently conducting surveys and focus groups of nearly 70,000 participants, Ms. Rehmeier was able to assess not only the gaps in workers' knowledge and savings rates but also the need for a simplified education and communication strategy. The result was a pair of interactive calculators. One assesses the impact of defined benefit pension, social security and retirement savings, while the other provides a detailed look at how much participants need to achieve retirement spending goals based on anticipated years of work and savings. Each calculator allows participants to make quick adjustments to their retirement strategies so they avoid "the monotony of clicking the dreaded 'next page' button."
- Sarah Krause, director of retirement strategy and executive compensation, The Boeing Co., Chicago. Using America Saves Week in February as a backdrop, Ms. Krause initiated a program aimed at employees who weren't taking advantage of the company match. Because Boeing offers different match formulas to different groups of employees, Ms. Krause had to prepare targeted communications during the three-week program. It was a one-time campaign, but Ms. Krause said the strong response has prompted her to consider making this a yearly event.
The honorable mentions are awarded to:
- Carl Gagnon, assistant vice president, Global Financial Wellbeing and Retirement Programs, Unum Group, Chattanooga, Tenn. Seeking a way to reduce employee stress over student debt, Unum took two years to review and develop of plan, administered by Mr. Gagnon, that allows employees to convert the value of some unused personal time off towards payment of student loans. Unlike the Abbott program, Unum's effort, which will begin in January, isn't directly linked to a defined contribution plan.
- The National Association of Government Defined Contribution Administrators, Lexington, Ky. NAGDCA primarily represents deferred compensation plans whose efforts to improve participation are thwarted by the lack a federal law that allows auto enrollment. NAGDCA members must deal with a maze of state and municipal laws; about half of states still prevent auto enrollment because of anti-garnishment laws that weren't designed to affect defined competition plans. To educate members on what their peers are doing, NAGDCA conducted state-by-state research, then put its findings into an interactive map, posted on its website, that tracks activity of state and municipal governments.