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Board Oversight Scoring Engine

Measure director fulfillment of benefits oversight duties

Director Duties

Score fulfillment of ERISA duty of care and duty of loyalty

Peer Benchmarks

Compare against Fortune 500 and institutional investor standards

Liability Shield

Document oversight for D&O protection and shareholder defense

Directors Are Named Fiduciaries

Under ERISA, board members of self-funded plans are named fiduciaries with personal liability for benefits oversight. Yet most boards receive one annual benefits update—no metrics, no independent validation, no oversight documentation. When DOL audits or participants sue, directors discover they're personally liable for decisions they never reviewed. Our engine scores actual board engagement vs. fiduciary duty requirements.

Board Fiduciary Responsibilities

Duty of Care
  • • Understand plan costs and operations
  • • Review vendor contracts and fees
  • • Monitor plan performance vs. benchmarks
  • • Investigate conflicts of interest
  • • Act with same care as in own financial matters
Duty of Loyalty
  • • Act solely in participants' interests
  • • No self-dealing or conflicts
  • • Prevent plan assets from enriching vendors
  • • Challenge broker/consultant recommendations
  • • Put member welfare above company convenience
Duty to Monitor
  • • Receive regular fiduciary reports
  • • Review external audits/benchmarks
  • • Track vendor SLA compliance
  • • Investigate member complaints
  • • Ensure committee has resources
Documentation Standard
  • • Board minutes reflect benefits oversight
  • • Questions asked and answers documented
  • • Major decisions supported by evidence
  • • Independent expert opinions on file
  • • Conflicts disclosed and managed

What Directors Don't Know Hurts Them

Manufacturing Company Board

$8.4M Judgment

Participant lawsuit alleged PBM overcharges. Directors claimed they relied on broker assurances. Plaintiffs showed board received zero PBM performance reports in 5 years, never asked about spreads, approved renewals in under 10 minutes. Court ruled directors breached duty of care—personal liability because D&O policy excluded fiduciary claims.

Board Oversight Score: 12/100 (deficient). No benefits committee minutes, no vendor benchmarks, no independent audits, no documented oversight

Healthcare System Board

DOL Investigation

DOL audit revealed broker received $2.7M in undisclosed override commissions. Board defended that "benefits are HR's job." DOL cited board minutes showing benefits received 8 minutes/year total. Assessed penalties for failure to monitor—directors personally liable but settled via company indemnity.

Board Oversight Score: 24/100 (inadequate). Quarterly benefits update existed but no metrics, no questions documented, no follow-up on vendor fees