COVID-19: Dealing with the impact
9 July 2020 | Webinar
UK Career Business Leader
UK Wealth Leader
Partner, Head of Corporate
In the penultimate edition of our ‘dealing with the impact’ webinar series, Sylvia Pozezanac, Mercer’s UK CEO, looked a little further into the future, to when companies and pension schemes will start to move from the ‘return’ phase into what she believes will be the third and final stage of the COVID-19 crisis, the ‘reinvent’ phase.
“For many of us, we’ll discover the way we work and the way we do business will have changed forever,” said Sylvia. “Of course, that may be a positive change for some, but for others those changes will be very challenging and their business, their people and their pension scheme may be more permanently impacted as a consequence. Whatever your situation, Mercer is here to help, so I’ve asked my UK Leadership Team to join me to share their views on what reinvent might mean for all of us.”
“The landscape as we know it has changed,” said Laura McKim, head of Mercer’s UK career business. “Trends that were further out are happening more rapidly. We’re rethinking responsibility to each other, our environment and the sustainability of how we work. At home or in an office: how will the way we work attract future generations? We’re also seeing the employee value proposition change, with an emphasis on wellness, mental health and individualisation.”
“COVID has highlighted the need to run pension schemes differently in the UK,” explained Benoit Hudon, head of Mercer’s Wealth team. “Governance of these schemes has changed. It’s no longer good enough to meet every 3-4 months. You can improve outcomes for members if you keep your finger on the pulse and hold shorter (virtual) meetings, every month, if not every other week, with more action-focused agendas. Trustees have to ask themselves: is the model we have the right one? Is there something more efficient that would give a better return on our spend?”
Building on the point about optimising spend, Sylvia asked the panel: “What can companies do to ensure benefits remain relevant despite reducing budgets?”
“It talks to me of the need for budget redesign,” said Chris Bailey, a partner at Mercer. “Businesses have to manage all expense but COVID is a health crisis and has caused a gap in healthcare provision for months. So health risks have worsened and costs do look set to increase. It’s about making sure protection is in place for your people, from proactive healthcare right through to life assurance benefits. Clients will look to spend more efficiently and that may mean having to put limits in place but also being smarter in using the correct vehicles like self insurance and the use of healthcare trusts.”
It’s created a spirit of innovation and change, he says: “Perceived barriers to change have melted away. People are tackling legacy benefits to suit the workplace of today, instead of ten years ago. Employers are now far more concerned with the overall wellbeing of people because it dictates how productive they can be. That wellbeing is not limited to physical health; financial, social and mental health are also being impacted.”
Benoit talked about how employers want to provide access to tools to help employees manage wellbeing: “We recently launched Mercer Money, just before the pandemic hit us. To provide members with a holistic view of their financials, thanks to open banking technology. Instead of looking at a number of separate documents, individuals can now see everything at a glance, at their fingertips, 24/7. The pandemic has really brought forward demand for these kinds of services.”
“Digitisation is a great solution,” added Chris. “It provides an opportunity to automate and go through processes and remove duplication, to eliminate needless spend. Companies have struggled to get people to engage with benefits platforms, so it’s great to be working with an organisation that’s launched Ondo, our new wellbeing app, which uses workplace-based social media, and see how that’s encouraging people to interact.”
Laura agreed with the trend towards personalisation: “One topic that’s always popular is generational differences. People have focused on that, but as we as individuals know, our lives and needs don’t stay the same and aren’t defined by the year we were born. We need to work harder to put employees at the centre of our thinking as employers. Plus ensure we have the agility embedded in our cultures and systems to change rapidly as needs change. This sets us on a great path to future readiness.”
“It’s not about providing everything to everyone. It’s about providing choice,” said Chris in response to a question from Sylvia about the need to balance budgets with what employees want. “Benefits were designed 30 years ago to meet the needs of forty-something white males. Looking at how society has changed, we need to ask if these benefits are right for our people and direct them to what they want. Technology can do that. You can talk to an audience of one.”
Laura also stressed the need to consider different components: “What an employer offers as part of the employment package is very connected to how the employee feels but it’s not just about the tangibles,” she said. “We know there is a strong connection between engagement and productivity and wellbeing. Our research tells us that the pandemic is accelerating an emerging desire from employees to align with an organisation’s purpose and values. Not only does strengthening that alignment help retain great people, it also drives discretionary effort.”
Thanking the panel for their time, Sylvia concluded by saying: “I hope that you found the discussion of use, as you navigate your organisation through the complexities that are now our new reality going forward.”
Other topics discussed in the COVID-19: Dealing with the impact - the ‘reinvent’ edition webinar include how businesses are balancing economics with empathy, the importance of being brave and the accelerating pace of change.
Find out about our free information as well as tools and resources to help your company, your pension scheme and your people along with recordings from our previous webinars.