logo
Ask Question

Asked by ESTELA LUCCHESI on Jun 01, 2024

verifed

Verified

In the feature Managing Ethics: Ethical Implications of Defined Contribution Plans, IBM froze its defined benefit plan and began automatically enrolling employees in a 401(k) plan. What steps did IBM take to help protect its employees against the downside risks of 401(k)s?

Downside Risks

Potential negative outcomes or losses that may occur as a result of an investment or decision.

401(k)s

Tax-advantaged, employer-sponsored retirement saving plans that allow employees to save a portion of their paycheck before taxes are taken out.

Defined Benefit Plan

A retirement plan where employee benefits are computed using a formula that considers factors such as salary history and duration of employment, with employer contributions funding the benefits.

  • Understand the moral consequences of modifications to benefits and ways in which companies can safeguard the welfare of their workers.
verifed

Verified Answer

ZK
Zybrea KnightJun 06, 2024
Final Answer :
In addition to automatic enrollment and providing financial advice, IBM has taken several additional steps to help protect its employees against the downside risk of 401(k)s. These include superlow fees, custom-designed portfolios, automatic rebalancing of investments, and an annuity income option.

Related questions

Which of the Following Is a Concern Created by Shifting ...

The Growing Approach to Managing Employee Benefits Is the ...

Benefit Programs Make Insignificant Contributions to Attracting and Retaining Key ...

In Learning from Experience: Enterprise Rent-A-Car,Enterprise Is Now Run By___,the ...

One of the Disadvantages of Flexible Benefit Plans Is the ...