14 episodes

Most retirement benefits for American workers are built up through workplace savings plans where employers play a pivotal administrative and legal role as the Plan Sponsor. PGIM’s new podcast, The Accidental Plan Sponsor™, hosted by Josh Cohen, Head of Institutional Defined Contribution, explores the origins, evolution, and trends within the employer-based retirement system.

The Accidental Plan Sponsor‪™‬ Josh Cohen, Head of Institutional Defined Contribution, PGIM

    • Business
    • 4.8 • 24 Ratings

Most retirement benefits for American workers are built up through workplace savings plans where employers play a pivotal administrative and legal role as the Plan Sponsor. PGIM’s new podcast, The Accidental Plan Sponsor™, hosted by Josh Cohen, Head of Institutional Defined Contribution, explores the origins, evolution, and trends within the employer-based retirement system.

    Episode 7 - Lawyering Up: The Impact of Class Action Lawsuits on the Retirement System

    Episode 7 - Lawyering Up: The Impact of Class Action Lawsuits on the Retirement System

    Jerry Schlichter and Jamie Fleckner have some things in common. They both got into law through political activism, and they’ve built their careers on ERISA litigation. But where they differ is largely about who their clients are. One represents plan sponsors and their providers, the other represents employees who feel they have been wronged, and their legal battles have shaped how the defined contribution retirement space thinks about innovation. In this episode, we sit down with each to try to understand the history of these cases, how they work, and how litigation has influenced plan sponsor decision making.
    Key Takeaways:
    [:25] Josh opens up today’s episode on lawsuits and the effects it has on innovation. How did we get here in the first place? Let’s ask some prominent lawyers about the history of how this all came to be. 
     
    [2:25] Jerry has always been an advocate for civil rights and has seen first-hand how much good law and order can do. After being a student protester and passing the bar, Jerry took on race and gender discrimination cases against large companies.
     
    [4:05] Jerry’s path eventually led him to investigating 401k plans for minorities. The more he saw, the deeper he dug. He found himself in unknown territory. There was no definition on how companies were making their investments or the types of fees they were charging. If he were to take on this case, he would be going to war with companies with big pockets. 
     
    [7:55] As a young lawyer that represents plan sponsors at the time, Jamie found himself deep into ERISA topics. Jamie mostly worked around the issue of company stock options and retirement plans, but what Jerry brought to the table was completely different. Plan fees have to be monitored and capped based on what’s happening in the market. Third-party mutual funds saw ‘record keeping’ fees as a loophole. 
     
    [11:45] Jerry was challenging some pretty ‘status quo’ practices. In trial, Jamie saw first hand how little people understood about ERISA. After a month’s long trial and several witnesses taking the stand, the judge still had a thousand questions on how this process all works.
     
    [15:15] Jerry knew he had to be detailed and diligent in his work. They had to make sure their research was accurate. His team read every public information available to understand this better. 
     
    [18:45] The human element really comes to light in cases like this. A plaintiff was displeased with her plan sponsor and her 401k investments, but inadvertently didn’t know that by suing them, she was also suing her former employer; who she loved. 
     
    [22:20] Trials are a big production with a lot of emotions to balance in between. Jamie explains why most companies decide to settle, even if they’re in the right. 
     
    [26:15] Appeal after appeal, Jerry sees his case go to the supreme court. The first 401k excessive fees case in history. 
     
    [29:15] Despite Jerry and Jamie been on both sides of an ERISA lawsuit more than once, they know that, for the most part, plan sponsors are not crooks.
     
    [33:40] As long as plan sponsors make decisions based on the best interest of their participants, everything will be fine. This means, a lot more sponsors are playing things safe when it comes to other people’s investments. 
     
    Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.
    Links:
    The Accidental Plan Sponsor
    Mentioned in this episode:
    More about Jerry Schlichter
    More about. Jamie Fleckner

    • 42 min
    Episode 6 - Carrots & Sticks: The Impact of Regulations on the Retirement System

    Episode 6 - Carrots & Sticks: The Impact of Regulations on the Retirement System

    While saving for retirement has been simplified and streamlined in recent decades, with tools like auto-enrollment and target date funds, the retirement savings ecosystem is anything but simple. It’s a complex confluence of innovators, service providers, employers, workers, consultants, lawyers, and, yes, government officials.
    Regulators play a huge role in our industry, so understanding who they are and how they work is an important factor in the outcomes for plan sponsors and plan participants. In this episode, we speak with two former Department of Labor EBSA directors, Brad Campbell and Phyllis Borzi, about the challenges and opportunities in regulating the employee benefits space, including the enactment of the landmark Pension Protection Act of 2006.
    Key Takeaways:
    [:04] Josh opens up today’s episode with a quick recap of episode 5 which focused on the work of two innovators in the field. He opens up this part of the conversation on what made the start of Target Date Funds and automatic enrollment so very impactful, the passage of the Pension Protection Act of 2006.
     
    [2:18] Josh explores the regulatory carrots and sticks of EPSA through the eyes of two of its leaders, we begin with Bradfrod Campbell. Brad shares about how he came to shape the world of modern retirement savings as the Assistant Secretary of Labor for Employee Benefits in the United States Department of Labor.
     
    [4:18] The Pension Protection Act was passed while Brad worked as a young Republican, he speaks about his beginnings in the Government and how he found ERISA, enrolled in law school and weathered the Enron scandal.
     
    [8:15] Phyllis Borzy took over Brad’s position as the Assistant Secretary of Labor for Employee Benefits in the United States Department of Labor. She talks about how she was always drawn to law and enrolled the year ERISA passed.
     
    [11:14] Her love for ERISA was cemented after her stay in corporate law and she brought it into her career in government all the way up to what she calls the Gingrich revolution.
     
    [13:45] Brad and phyllis had similar challenges but different approaches. Brad talks about the balancing act between carrot and stick.
     
    [15:09] Josh offers a quick explanation of 404C — a pivotal part of the Accidental Plan Sponsor story as well as the Pension Protection Act. Brad weighs in on the way 404C functions.
     
    [19:14] Phyllis shares her profound hate for 404C, her multiple reasons why and what she would do differently.
     
    [22:25] The Pension Protection Act from Brad’s point of view — both pre and post Enron — and the legal implications that had to be thought over in that context.
     
    [26:15] More carrots! 404C generated a proliferation of offers without much structure for participants to direct their investment, Brad describes how they helped write the QDIA regulation and define 3 mechanisms for an appropriate default investment that would stand the test of time.
     
    [30:00] Brad shares the difficulties of putting regulations in place, from congress to burgeoning lawsuits inter-administration. Phyllis shares her take and the work she did on the regulation, get ready for some bi-partisan agreement!
     
    [34:44] Phyllis takes a moment to denounce the attacks her co-workers received from the nay-sayers.
     
    [35:54] With overwhelming bi-partisan support, the Secure Act was passed in 2019, Josh touches on some of the issues this rule attempts to address. Brad and Phyllis share their joy having worked on ERISA.
     
    [37:48] Josh thanks his guests for sharing their stories and ends with a taste of what episode 7 has to offer.
     
    Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.
     
    Links:
    The Accidental Plan Sponsor
     
    Mentioned in this episode:
    More about Bradford Campbell.
    More about P

    • 40 min
    Episode 5 - How Target Date Funds and Behavioral Economics Shaped Retirement Plans

    Episode 5 - How Target Date Funds and Behavioral Economics Shaped Retirement Plans

    The future of defined contribution retirement savings will always be marked by two key concepts: putting individual investors first when designing plans, and constantly innovating. Over the course of the next four episodes, we’re going to discuss how regulation, litigation, and the role of consultants both support and deter innovation. We’re going to start with two featured guests who laid the foundation for the modern 401(k):  
     
    • Brigitte Madrian, who pioneered behavioral economics work on automatic enrollment 
     
    • Larry Tint, creator of the Target Date Fund
     
    Key Takeaways:
    [:29] Josh opens up today’s episode with a quick recap of episode 4 which focused on the work of two innovators in the field. He pursues the series by talking about his  experience and what he believes the very heart of the issues to be — innovation, regulation and consultancies.

    [4:00] How did Larry Tint — former U.S. CEO of Barclays Global Investors — change the trajectory of the retirement industry? Josh and Larry detail his career trajectory and how it led to meeting the future Nobel prize winner Bill Sharpe and the birth of SharpeTint.

    [8:00] Most individual investors don’t know how to build investment portfolios! Larry talks about his time at Wells Fargo and his work with Don Luskin to use the technology he created with Bill to the benefit of individuals. The Target Date funds were born.

    [11:39] The General Motors exception! Also Larry talks about the innovations he didn’t act on or think of and how this might have changed the course of things even further — wheels on suitcases?

    [15:30] Target date Funds were still being held back, and more innovation was required. Josh introduces Behavioral Economist Brigitte Madrian — ninth Dean of the Marriott School of Business at Brigham Young University (BYU). 

    [17:10] Behavioral Economics was not a thing when Brigitte began her academic career. She speaks to a life-changing moment in data analysis and the 20 plus years of research this generated!

    [22:29] So why is auto-enrollment so successful? Brigitte shares what her research points to as well as the kinds of organisations that immediately were on board, and the ones that weren’t.

    [26:07] The biggest hurdle… Lawsuits! Brigitte talks about the policy makers that got in touch with her and how she helped shape policy. She also shares the pride she feels about her public and academic involvement.

    [28:55] Larry takes a moment to reflect on his contributions to the retirement landscape.

    [29:43] Josh thanks his guests for sharing their stories and opens up the discussion on what came after Target Date Funds and automatic enrollment in the retirement planning space.

    Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.

    Links:
    The Accidental Plan Sponsor

    Mentioned in this episode:
    More about Larry Tint.
    More about William “Bill” F. Sharpe.
    More about Don Luskin.
    More about Brigitte Madrian.

    • 31 min
    Bonus: Episodes Recap With Mike Barry

    Bonus: Episodes Recap With Mike Barry

    Josh reviews the first four full-length episodes of the podcast with long-time friend Mike Barry, President of O3 Plan Advisory Services LLC, who offers his thoughts while also sharing some personal experiences from 40+ years’ in the benefits field. 

    • 14 min
    Bonus: Insights From PGIM Colleagues

    Bonus: Insights From PGIM Colleagues

    Josh engages in an energetic discussion with two colleagues and long-time Defined Contribution (DC) experts David Skinner and Sara Shean from PGIM Real Estate. The discussion covers the evolving DC environment, the challenges facing plan sponsors, and the role of real estate in DC.

    • 13 min
    Bonus: Ted Reminisces About The Early Days of DC

    Bonus: Ted Reminisces About The Early Days of DC

    In this bonus episode, Ted Benna, who is often dubbed the father of the 401(k) and who was a guest from episode 2, reminisces about the early days of DC plans.  Stories he shares includes a memorable exchange with a future vice presidential nominee about retirement savings, how plans were built and communicated in those days, and blowback he received from some in the industry.

    • 7 min

Customer Reviews

4.8 out of 5
24 Ratings

24 Ratings

Lara_M_NJ ,

Amazing podcast!

If you want to understand the history of our retirement system, current state and challenges, and what it might look like in the future, take a listen!

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