Global Employee Benefits The Swiss Life Network Perspectives May 2015 SL_Newsletter_March_2015_V03.indd 1 13.05.15 13:44 Dear Reader This edition contains a variety of examples of how the Swiss Life Network is committed around the globe to supporting our clients and business partners turning challenges into opportunities. To do this, Swiss Life Network relies on the sound expertise and proven experience of all its long term Network Partners, and the trust and loyalty of clients since very many years. This is my last editorial. I have greatly enjoyed heading and being part of the Swiss Life Network for the past nine years and shaping it, together with all of you – clients, partners, and a great team at head office – into what it is today. Thank you very much for all your input, feedback, challenges and opportunities. I wish you all the very best for a successful and exciting future. Yours sincerely Margrit Schmid SL_Newsletter_March_2015_V03.indd 2 13.05.15 13:44 Future Outlook Broker Outlook 2015 for Employee Benefits 4 Feature Story Challenges are always opportunities 9 Beyond Retirement Flexible retirement 11 France: Swiss Life France targets seniors12 New Benefits Disability coverage to close the gap 12 South Africa: Momentum’s latest innovations: new death benefits for employees 14 Flexibility Canada: Evolving healthcare trends call for flexibility 15 Sustainability Spain: VidaCaixa recognised for excellent pension fund management 16 Striking a balance between low interest rates and performance 17 Swiss Life looks back on a successful financial year 2014 18 The Netherlands: Zwitserleven again most sustainable investor 19 Network News Training and networking for a fast-paced, evolving world 20 Network Partner anniversaries 22 Swiss Life Network Partners23 Impressum Publisher Swiss Life Network, General-Guisan-Quai 40, P.O. Box, 8022 Zurich, Switzerland, T +41 43 284 37 97, F +41 43 284 39 97, [email protected] • Editor Swiss Life Network in cooperation with network partners, clients and Openline • Photos Swiss Life Network in cooperation with network partners and clients Photo Front SL_CC_Pottery • Design and Print Swiss Life Marketing Support • Copyright Swiss Life Network Reprint authorisation on agreement with the Publisher • The quarterly Global Employee Benefits Newsletter is available online: www.swisslife-network.com/newsletter Global Employee Benefits Newsletter | May 2015 SL_Newsletter_March_2015_V03.indd 3 13.05.15 13:44 4 Feature Story Broker Outlook 2015 for Employee Benefits We asked leading brokers and consultants to share their thoughts and measurements for international employee benefits in 2015. Looking ahead into a constantly changing environment, the impact of disruptive business models on Employee benefits and how to address the challenges which they pose, stand in the centre of our attention. SL_Newsletter_March_2015_V03.indd 4 13.05.15 13:44 Future Outlook 5 What main factors do you see influencing the Employee Benefits industry in a world of radical change, with political instability, uncertainty, and economic fluctuations? AON The ageing of the work force, people’s inability to retire financially, healthcare costs rising at double the rate of regular inflation, social security cutbacks, expectations from millennials for everything on demand, the do-it-your- self economy, continuous education, flexible careers, big data: all these factors point toward mass customisation, flexibility, and more choices for Employee Benefits. Kessler We are facing many challenges from a local and also from an international point of view. Local issues are changes in legislation, longevity, low interest rates, and how benefits are financed. Internationally we have subjects such as managing international benefits, keeping information up to date, costs, compliance, mobile employees, and han- dling M&As. Mercer The need for employers to find innovative, cost-effective, and relevant benefit programmes that can be offered to employees. Employers need to offer attractive programmes that meet the needs of both ageing and next-genera- tion employees. The one-size-fits-all model is long gone for certain industries. Towers Watson It’s certainly an interesting world, but I doubt we will ever live in a period without political instabilities and other uncertainties. I think the most critical issue impacting Employee Benefits today, and likely to continue dominat- ing the focus of multinational leaders, is governance. Companies require clear delineations of roles and responsi- bilities for employee benefit programmes, for both larger and smaller cost plans. It’s why we’re seeing such an in- crease in demand for global brokerage and global pension investment and advisory appointments: multinational leaders need the assurance that everything is being covered and that benefit programmes are aligned with glob- al reward strategies, properly leveraged to ensure costs consistent with their multinational competitors, and that the long-term impacts on benefit programmes are being considered and planned for appropriately in all markets. Francois Choquette Francois Choquette leads the Global Benefits consulting business for Aon. He has 25 years of experience assisting multinationals with a broad range of international benefits issues such as M&A, global benefit design and financing, global governance policies, and employee mobility. He has lived in Montreal, Toronto, New York, and San Francisco, and worked and travelled in more than 40 countries. Global Employee Benefits Newsletter | May 2015 SL_Newsletter_March_2015_V03.indd 5 13.05.15 13:44 6Future Outlook Will disruptive business models (such as Amazon, Uber or Youtube) affect the Employee Benefits industry? How? AON The biggest challenge for us at Aon is the emergence of mid-size (some would even say small) multinationals. How do you help clients who go from zero to 2,000 employees in 50 countries in two years (still with “just” 20 employees per country). Employee Benefits need to cross borders and scale more easily. Multi-employer platforms must emerge. Demands from clients to obtain timely and relevant health-related claims data will impact health intervention programmes and shape the delivery of healthcare in emerging markets. Kessler New business models will certainly have an impact on the employee benefits industry. Employees are able to access more information and will have more knowledge about Employee Benefits. Depending also on the age group, these new models will be used differently. Due to complexity and the diverse personal situations of each employee, we be- lieve that focusing on personal consulting will remain crucial. Mercer Yes, to some extent. The younger workforce will be looking for new ways to access and be informed about all as- pects of a compensation package. The term ‘benefit’ will perhaps be re-defined in the near future. Towers Watson Towers Watson is fortunate to work with some of the most innovative companies around, who are constantly challenging the status quo of their own business models to generate new and profitable products and services. These companies are likewise demanding innovation from their consultants and benefit providers. While tradi- tional global solutions such as pooling and brokerage continue to remain relevant, we must continually look for cutting edge solutions that deliver results for our clients. Towers Watson has been pioneering several new and evolving global benefit solutions, such as: •Benefit captives: the number of captives used to fund Employee Benefits has nearly doubled over the last seven to eight years, and Towers Watson has supported most of these companies newly entering the captive space. •Global risk marketing: taking global books of business for life and disability coverages out to bid simultane- ously gains immediate leveraging on cost savings through reduced premiums and increased corporate gover- nance. •Towers Watson’s Global Access: offering pre-packaged benefit solutions eliminates the need for brokers and greatly reduces the role of local HR in managing benefit programmes. Markus Leutenegger Markus Leutenegger is an international employee benefits spe- cialist. Born in the UK and now a British/Swiss national, he has nearly 30 years of pension consulting experience and has worked for Kessler since 2012. Before that he was with two life insurance companies and an insurance broker. His main functions are pen- sion scheme consulting, multinational pooling, and global bene- fits management. SL_Newsletter_March_2015_V03.indd 6 13.05.15 13:44 Future Outlook 7 Will your business model be impacted by disruptive business models? If you think this could be the case, what measures are you taking? AON Yes. We are building a global technology platform that can be used to help clients locally and globally for broking (e-auction), inventory, governance, data analytics and employee experience. We’re creating global common process- es to serve clients more efficiently, including an inbound dedicated team for multinational clients, and cross-border and offshore admin and consulting teams. Kessler We are offering our clients up-to-date information software to help them manage international benefits. At the same time, we’re extending our personal consulting capabilities, for instance by organising special events for in- ternational employees coming to Switzerland. Our clients see these events as very valuable, as it is a challenge to communicate Employee Benefits. Mercer Yes, it already has. We’re constantly developing tools and processes to meet increasing demands for quicker,