State Street Global Advisors is looking for ways to fit exchange-traded funds into the American retirement system — one of the $9 trillion industry’s final frontiers.

While ETFs have infiltrated nearly every part of the investment landscape over the past decade, they’re shut out from the 401(k) system, which instead relies on structures such as mutual funds and separately managed accounts. Newly installed SSGA executive vice president and chief business officer Anna Paglia is helping to lead an effort to change that.

“We are working really hard with regulators, with investors, with plan sponsors to make sure that ETFs find a way into retirement. Because 401(k) plans don’t buy ETFs for all the reasons that are very known to us — technology, regulation — but we believe that these things are going to converge at some point,” Paglia said in a Bloomberg Television interview. “ETFs, just like mutual funds, are used in other parts of the retirement industry — for example, IRAs — and we are really working to build that ecosystem where ETFs can find their way into 401(k) plans as well.”

While ETFs have been stealing market share and assets from mutual funds for more than a decade, mutual funds have a powerful incumbency advantage as 401(k)s are built to incorporate the wrapper. As a result, mutual funds still command about $20 trillion of investment assets.

Advocates argue that well-known benefits of the ETF wrapper — low costs and tax-efficiency — belong in retirement portfolios. The pushback is that capital gains taxes don’t apply to 401(k)s and the intraday liquidity of ETFs — which has made them a hit with individual and professional traders alike — isn’t necessarily a desired feature in retirement accounts.

“I don’t think it’s a great fit,” Ed Murphy, chief executive officer of Empower, the second-largest retirement services provider in the US, said in a BTV interview in March. “When I think about the 80,000 plan sponsors that we have from the largest corporations down to the very small companies, I see very little demand for ETFs.”

Even so, Paglia has made it an early priority in her tenure at SSGA, where she started in February. Previously, Paglia was Invesco’s global head of ETFs.

“I’m an ETF lady,” Paglia said. “I do believe in the strength of the wrapper, so I do believe they will play a fantastic role in 401(k)s and retirement plans.”

This article was provided by Bloomberg News.