Does a successful 401(k) plan influence a company's profitability? It's a question T. Rowe Price wanted to answer. Our research determined that there are significant correlations between 401(k) plan design and corporate financial performance existing within and across industries, regardless of company size.1
The Findings: Profits and Plan Design Go Hand in Hand
We evaluated the relationships between common corporate financial performance measures (used by CFOs) and markers of successful 401(k) plans (used by Human Resources):
More information about how we approached the research is available in our white paper.
1 Our data set included plans with more than $50 million up to $36 billion in plan assets. In our regression analysis, we controlled for plan size, meaning that the correlations we report will hold irrespective of plan size. We suspect that similar correlations exist for plans with assets below $50 million and over $36 billion.