Global report from AON and ABI give view over worldwide benefit trends.
Governance progress acknowledged.
Aon and the American Benefits Institute have released ‘Global Benefits Governance and Operations Study 2018/2019’. The latest survey – the third since 2012 – shows that companies worldwide are making progress with global governance of employee benefits – although nearly all of them still believe that more can be done.
The study of over 200 multinational companies from around the world and ranging in size from over 100,000 to fewer than 10,000 employees, asked global compensation and benefits leaders for their views on best practices in global benefits management. Key issues explored included what companies can do to improve alignment of benefits with organisational strategy and how they can better manage the costs and risks of global benefits.
“In this latest study, we have explored whether multinational companies have made progress towards best practice governance – maintaining the optimum control across their worldwide benefits operations – and whether value is still being seen in achieving best practice,” said Jim Tindale, partner at Aon. “We dug deeper into the drivers and enablers for governance, as well as the barriers that many have experienced.
“What is clear from the latest study is that there is a strong desire to implement best practice global governance – with 90 per cent of companies wanting to make further progress and 74 per cent of them aiming to achieve best practice global governance by 2021. Encouragingly, companies achieving a better state of affairs are also signaling that they are increasingly able to demonstrate the value from having done so.”
Tindale continued: “We are seeing that those companies that are exhibiting best practice global governance are far more confident in achieving their goals – and can back this up through having completed actions that other companies still wish to do. Key to this inevitably is their ability to identify financial savings from good global governance.
“Irrespective of their individual progress, nearly all the respondents to our study want to continue to broaden and deepen their involvement in the design, financing and operations of their benefits arrangements around the world. However, fewer have attained best practice levels than had hoped to do so – 31 per cent compared to 80 per cent who aimed to do so by 2018 in our previous study.”
James A. Klein, president of the American Benefits Institute – the research and education affiliate of the American Benefits Council – agreed that US companies are increasingly focused on harmonising their employee benefit operations around the globe. He said: “The results of this comprehensive study are consistent with what we hear from benefits professionals themselves: the global economy and talent market remain extremely competitive. A ‘best practice’ benefits governance approach can make a big difference in helping companies achieve their human resource objectives as well as their greater business goals.”