The Fiduciary Gaps That Could Be Costing Your Company — And How to Close Them

For many organizations, managing a retirement plan feels routine. The plan is established, vendors are in place, contributions are flowing, and participants are enrolling. From the outside, fiduciary risk appears to be under control.

In practice, fiduciary exposure rarely comes from a single major failure. It develops quietly, through small gaps in process, documentation, and oversight. Over time, those gaps accumulate. They often remain unnoticed until there is a trigger—an audit, a participant complaint, leadership turnover, or increased regulatory scrutiny.

For HR leaders, CFOs, and benefits managers, the challenge is not a lack of good intent. It is the assumption that “no news is good news.” Fiduciary risk is less about what is done incorrectly and more about what is missed.

Below are several common fiduciary gaps that appear across organizations of all sizes, along with practical ways to close them.

Gap 1: Unclear fiduciary roles and responsibilities

Many plan sponsors struggle to answer a basic question: Who, exactly, is acting as a fiduciary—and when?

In some organizations, fiduciary responsibility is informally shared among HR, finance, and leadership. In others, a committee exists but lacks a defined scope. Vendors and advisors may be heavily involved, but their fiduciary status is not clearly documented.

When roles are unclear, accountability suffers. Decisions may be made without clarity on authority, and essential tasks, such as monitoring investments or reviewing fees, can fall between the cracks.

How to close it:
Clear governance is foundational. Define who serves as a fiduciary, what decisions they are responsible for, and how those decisions are made. Committee charters, role definitions, and documented decision-making processes help ensure fiduciary duties are understood and consistently applied.

Gap 2: Inconsistent or incomplete documentation

Plan sponsors often make prudent decisions but may fail to document them adequately. Meeting notes are brief or nonexistent. Reviews happen, but the rationale behind decisions is not captured. Policies exist but are outdated or not actively referenced.

From a fiduciary perspective, documentation matters. Under ERISA, process is central. If a decision cannot be demonstrated through records, it may be treated as if it never occurred.

This gap is especially common during periods of stability, when there are few plan changes and oversight feels routine.

How to close it:
Establish a consistent documentation cadence. Maintain meeting minutes, record key decisions, and periodically review governing documents such as the Investment Policy Statement. The goal is not excessive paperwork, but a clear, defensible record of fiduciary oversight.

Gap 3: Passive investment and fee monitoring

Once an investment lineup is established, monitoring can become passive. Funds remain in place for years. Fee structures are assumed to be reasonable because they were reviewed in the past. Comparisons to the broader marketplace happen infrequently, if at all.

Markets evolve. Products change. What was competitive five years ago may not be today. Without a regular, documented review process, sponsors risk falling behind prevailing standards, even if participant outcomes appear stable.

How to close it:
Adopt a regular review schedule for investments and fees. Benchmarking does not require constant change, but it does require periodic evaluation and a clear rationale for decisions to retain or replace options. Consistency and discipline are more important than frequency.

Gap 4: Committee drift and knowledge gaps

Retirement plan committees often experience turnover. New members join without formal onboarding. Others rotate off with institutional knowledge that is never transferred. Over time, the committee’s understanding of fiduciary obligations can erode.

This drift is rarely intentional. It is a byproduct of busy roles and competing priorities. Without ongoing education, committees may rely too heavily on advisors or vendors, without fully understanding their own responsibilities.

How to close it:
Plan for continuity. Provide basic fiduciary education for committee members, especially during onboarding. Periodic refreshers help ensure the group understands its role, the plan’s governance structure, and current expectations. Education supports better questions and more effective oversight.

Gap 5: Misalignment between vendors and fiduciary intent

Plan sponsors often work with multiple providers—recordkeepers, investment managers, consultants, and advisors. Each plays a role, but not all are fiduciaries, nor are they accountable in the same way. Confusion can arise when sponsors assume oversight is being handled elsewhere. Services may overlap in some areas and be absent in others. This misalignment creates blind spots, particularly around monitoring and governance.

How to close it:
Clarify and document who is responsible for what. Understand each provider’s role, services, and fiduciary status. Regularly review service agreements and ensure they align with the plan’s governance needs. Coordination matters as much as capability.

Gap 6: Governance that has not scaled with the organization

As companies grow, retirement plans tend to become more complex. Participant counts increase. Assets grow. Expectations change. Governance structures, however, often remain unchanged.

What worked for a smaller organization may not be sufficient at scale. Processes that were once informal can become strained under increased scrutiny.

How to close it:
Revisit governance periodically, especially during periods of growth or organizational change. Assess whether committee structures, review schedules, and documentation practices still fit the plan’s size and complexity. Adjusting governance is a sign of stewardship, not failure.

The common thread: Fiduciary risk lives in the gaps

Across these scenarios, a consistent theme emerges: fiduciary risk accumulates quietly. It develops through missed reviews, unclear roles, outdated processes, and assumptions that someone else is handling oversight.

Strong fiduciary management is not about perfection. It is about structure, consistency, and the ability to demonstrate a thoughtful process over time.

Where the right support makes a difference

Many plan sponsors recognize these gaps but struggle to address them without adding administrative burden. This is where a well-aligned partner can help bring structure and clarity without unnecessary complexity.

IMA Retirement works with sponsors to identify common fiduciary gaps, formalize governance practices, and create repeatable oversight processes. The focus is not on adding layers, but on making fiduciary responsibilities more manageable and sustainable—supporting sponsors as plans evolve.

Staying ahead of risk

Fiduciary oversight is not a one-time exercise. It is an ongoing discipline that benefits from regular review and clear governance.

By focusing on what is often overlooked and proactively addressing those gaps, plan sponsors can stay in control, reduce exposure, and better support the long-term outcomes of their retirement plans.

Download The Fiduciary Checklist: What Every Plan Should Review Annually.