Pearson

NOMINATOR COMMENTS

As a company rooted in education, Pearson extends its commitment to learning by fostering financial literacy and wellness for its employees. Through innovative campaigns, strategic plan design and measurable participant outcomes, Pearson exemplifies excellence in retirement plan management.

Through personalized communication, innovative plan design and unwavering focus on participant outcomes, Pearson demonstrates a sincere dedication to helping employees build a better future for themselves and their families. We believe Pearson sets an exceptional standard as a plan sponsor and is entirely worthy of being recognized as Plan Sponsor of the Year.

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PLANSPONSOR: Please cite any noteworthy initiatives you have taken in the past 24 to 36 months that have produced results to improve your plan, and describe the results.

Pearson: Our initiatives included:

• Adding the ability for participants to defer to the 401(k) on a Roth after-tax basis;
• Adding a true after-tax savings component to the 401(k) that employees can use as an emergency savings account or to save for key life events;
• Allowing post-termination loan repayments so employees won’t get hit with the additional 10% early withdrawal penalty;
• Changing 50% of the funds in the investment lineup to reduce fund costs to participants;
• Reducing administrative fees for participants;
• Reducing fees for managed accounts; and
• Highlighting the various resources available through the recordkeeper to assist employees with budgeting, financial planning and getting a wholistic view of their savings/debt information.

As a result of this work, we increased the participant lifetime income score from a plan average of 84% to 109%.

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PLANSPONSOR: What challenges do you face in plan administration or participant engagement?

Pearson: Our biggest challenge was participant engagement. This was the impetus for us to implement a robust communications campaign. Participants received communications from Pearson and the recordkeeper, via email and snail mail.

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PLANSPONSOR: Please explain the ongoing governance efforts of those involved with the plan meant to ensure its compliance and effective operation.

Pearson: We use two committees. The Investment Committee is comprised of representatives from finance, treasury and the benefits team. It meets quarterly and focuses on effectively supervising, monitoring and evaluating the investment of the plan’s assets. The Administrative Committee is comprised of benefit team members. It is responsible for overseeing the day-to-day operations and administration of the plan.

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This year, for our Plan Sponsor of the Year profiles, we are publishing Q&As based on the finalists’ applications and nominator comments. Responses are edited and may be paraphrased. In cases where the finalist self-nominated or, on its application, referred judges to the nomination for the answer, we have attributed those nominator answers to the plan sponsor.