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global-benefits-vision.com September 2016
Knowledge & Wisdom for Global Employee Benefits Professionals
18 Being W.O.R.L.D. Wise – Relationships (3) Natalie Richter
26 U.K. Group Risk – a market updatePaul Avis
30 Travel Risk Management Best Practices to Help Keep Your Global Workforce SafeTim Crockett
38 Multinational Employers Expand their View, and Reach, in Global Employee BenefitsLance Henderson
46 Inequality and the FirmDr. Sandy Pepper
Chris Mayo on Willis Towers Watson's Strategy in Global Employee Benefits
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68 Index of Articles
3
Table of Contents
60 News
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09 Upcoming Conferences and Events
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team
Eric Müller-Borle, co-founder, publisherFrédérique Hindryckx, co-founder, sales and marketingYazid Hammoumraoui, co-founder, operations & supportCheryl Rosen, senior editorJulian Calne, news editorOlivia Dunn, assistant editorAgnès Molitor, senior designerMarc Signorel & the team at Outer Rim, web design and operations
U.K. Group Risk – a market update
Paul Avis
26
Being W.O.R.L.D. Wise – Relationships (3)
Natalie Richter
18
Multinational Employers Expand their View, and Reach, in Global Employee Benefits
Lance Henderson
38
Chris Mayo on Willis Towers Watson's Strategy in Global Employee Benefits
50
Inequality and the Firm
Dr. Sandy Pepper
46
Rob PatonElin Bredenberg
Travel Risk Management
Best Practices to Help Keep Your Global Workforce SafeTim Crockett
30
September 2016 - Global Benefits Vision 5
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Rob Paton is a performance, reward and talent leader with Aon Hewitt’s
Rewards Advisory practice in London. He has over 18 years of experience
partnering with clients to review, develop and implement people and reward
strategies and programs.
Rob has worked in three of the world’s largest economies – United States,
Australia and the United Kingdom – with two of the most prominent human
resources consulting firms – Willis Towers Watson, and Aon Hewitt. He has
advised over 300 clients on optimizing investments in people and enhancing
performance. Rob has a Bachelor of Science in Business Administration from
the University of North Carolina at Chapel Hill.
Rob Paton [email protected]
aon HewittPerformance, Reward and Talent Leader
global-benefits-vision.com
Profiles of Contributors
elin bRedenbeRg [email protected]
aon HewittPerformance, Reward and Talent Consultant
Elin Bredenberg is a consultant and has three years’ experience within
Aon Hewitt’s Performance, Reward and Talent practise in Sweden and the
UK. Prior to joining Aon Hewitt Elin worked as a part-time reward analyst
at a Swedish consultancy firm while simultaneously pursuing her Bachelor's
degree in Economics at Stockholm University, followed by her Master’s degree
in Economics of Innovation and Growth at The Royal Institute of Technology.
Whilst at Aon Hewitt, Elin has assisted companies in a variety of sectors carry
out a range of consulting projects.
Page 10 : Gender equality in Australia – the Origin case study→
10 Global Benefits Vision - September 2016
WWhen it comes to shining a spotlight on the difference between male and female pay, many companies are sceptical, hesitant, and even fearful. The discourse often focuses on risk—the threat of being named and shamed.
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Actions to Promote10in Your Organization
Gender Equality
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Australia, on the other hand, emphasizes the
opportunity to achieve fame—for driving a
workplace where all employees have access to
the same rewards, resources, and opportunities.
In dealing with the gender pay gap, and diversity
and inclusion more broadly, organizations can
look to the land Down Under for inspiration.
In the United Kingdom, beginning in 2018
all organizations with 250 or more employees
will have to report annually on male and female
pay levels. The U.K. will join other European
nations such as Austria, Belgium, and Sweden,
which have already enacted similar legislation.
In the United States, President Obama proposed
a similar measure earlier this year.
Australia implemented its directive on
gender pay reporting in 2012. The law compels
organizations with 100 or more employees to
report on male and female pay in a standardized
format, along with other elements such as
workforce composition and flexible work.
In alignment with the act, an agency
provides feedback to each organization
and bestows citations based on more
than 60 criteria.
In 2015 more than 90 Australian
organizations achieved this gender
equality employer of choice honor, including
Origin Energy. One of Australia’s largest
companies, with about 7,000 employees and
over $12 billion AUD (£7 billion GBP) in revenue,
Origin Energy also earned the award in 2014,
the year the program began.
Back in 2010, Origin signalled its intention
to be an early adopter of the Australian stock
exchange governance recommendations on
diversity in the workplace. The following year
the oil, gas, and electricity producer announced
a number of related targets and initiatives.
Since then, it has regularly and publicly reported
on its progress.
Reviewing Origin’s diversity and inclusion
statement reveals 10 key actions the company
has taken to promote a diverse and inclusive
work force (see eXHibit 1).
Rob Paton Elin Bredenberg
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Actions to Promote
in Your Organization
1. Appoint leaders who are unafraid
to promote gender equality
1 2. Develop a formal diversity
and inclusion strategy
2 3. Establish a group responsible for implementing
the strategy
34. Identify
and eliminate sources of bias
4 5. Establish specific gender
pay equity objectives
5 6. Conduct regular, comprehensive
reviews of remuneration
6 7. Set targets for female
representation in critical roles
78. Set targets for female retention
in critical roles8 9. Refine targets
over time9 10. Establish ongoing
accountability for gender equality
10
Exhibit 1: 10 Actions to PromotE GEndEr EquAlity
12 Global Benefits Vision - September 2016
10 Actions to Promote Gender Equality in Your Organization
Appoint leaders who are unafraid
to promote gender equality.
Earlier this year, the U.K. Minister for Women
and Equalities, Nicky Morgan, said, “I’m calling
on women across Britain to use their position as
employees and consumers to demand more from
businesses, ensuring their talents are given the
recognition and reward they deserve.”
In contrast, Origin’s chairman Gordon Cairns
said he believes the key to tackling workplace
gender issues is getting men speaking to men to
discuss unconscious bias, women in leadership,
and workplace diversity.
“The view that women aren’t tough enough,
the view that ‘well there’s no point in promoting
a woman because eventually when she gets to
family formation age she’ll go off and have kids,’
the view that a maternity leave is just an excuse for
why women are not getting promoted—we have
to address that unconscious bias which is seldom
spoken but deeply held,” he said.
Skeptics may question the merits of men
speaking up for women. Few would argue with
The Male Champions of Change, though, who
call for “more decent, powerful men to step up
beside women in building a gender equal world.”
The champions formed in Australia in 2010,
when several senior men (including Mr. Cairns,
and the CEOs of two Aussie icons, Qantas and Telstra)
met with Sex Discrimination Commissioner
Elizabeth Broderick. Since its formation,
group members have spoken at more than 350
events focused on women’s representation
in leadership as a priority both across
Australia and globally.
Develop a formal diversity
and inclusion strategy.
While the focus on gender equality and
pay is understandable, organizations should
define diversity in the broadest possible terms,
and bear in mind that pay is one of many
talent management levers.
Origin’s diversity and inclusion policy, which
aims to maintain an environment where all
individuals are supported and respected, applies
to all elements of the employee experience.
“Our Policy applies to all aspects of employment
including recruitment, selection, promotion,
training, remuneration, benefits, performance
management, and all other terms and conditions of
employment,” the statement says.
Establish a group responsible for
implementing the strategy.
In February 2016 the U.K. Treasury published
a report carried out by Virgin CEO Jayne-Anne
Gadhia, based on a nine-month review of
diversity in the U.K. financial services sector.
In July, more than 70 organizations pledged to
promote gender equality by signing the Women
in Finance charter.
One of the Gadhia report’s three key
recommendations was that “there should be an
executive accountable for improving gender diversity
at all levels of their organization and in all business
units.” Origin took this step five years ago,
establishing its diversity council. The company
noted in its 2011 annual report that the council
comprises the executive management team and
is chaired by the managing director.
22.
33.
11.SUGGESTED ACTIONS TO PROMOTE GENDER EQUALITY
-1
0
1
2
3
4
5
6
7
-2
8
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05
J un
DeC
06
DeC
07
J un
DeC
08
J un
DeC
09
J un
DeC
10
J un
DeC
11
J un
DeC
12 J un
DeC
13
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DeC
14
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Jun
DeC
15
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Exhibit 2: GEndEr PAy GAP, oriGin EnErGy (totAl PoPulAtion wEiGhtEd AvErAGE)
DeC
99
J un
DeC
00
J un
DeC
01
J un
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02
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04
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Identify and eliminate sources of bias.
Bias is often unconscious, and individuals
and organizations may or may not acknowledge
it as a potential issue. Organizations should
analyze their systems and processes to
identify where bias in decision-making has
occurred or could occur, and take actions to
eliminate such prejudices.
Origin has taken a few simple actions to
mitigate potential biases. “Every interview panel
for a senior role must be made up of both men and
women; where possible, every shortlist must have
at least one woman,” the company’s policy states.
In addition, “any team meeting to make decisions
about performance, promotion, remuneration, or
the identification of senior talent must begin their
meeting with a short discussion of the potential
causes of bias at play in the room.”
Establish specific gender
pay equity objectives.
Within the Gadhia report referenced earlier,
a second key recommendation was that “firms
should set their own internal targets (for gender
equality), against which they publicly report progress.”
Origin has measured achievement against
specific gender pay equality targets for the past
15 years, and shown its progress relative to these
targets (retrospectively) in its annual report since
2014. In its 2015 annual report, the company
committed to continue to deliver equal pay for
men and women at each job grade.
Since 2014, Origin has published a table and
chart illustrating the difference between male
and female pay, for each job grade, on a half-
yearly basis dating back to 1999. In 2015 the
chart showed that the company has steadily
closed the gender pay gap, and noted that the
most recent figure of 0.4% was within the
targeted range of less than 1% (see eXHibit 2).
Conduct regular, comprehensive
reviews of remuneration.
Under the proposed legislation in the
United Kingdom, organizations will have
to report on a limited number of specific
remuneration elements.
While these requirements are a start,
ideally organizations should conduct holistic
reviews of their remuneration practices every
few years, if not annually. These reviews should
44.
55.
66.
Perc
enta
ge p
oint
s
to 30 June 2015
0,4
14 Global Benefits Vision September 2016
10 Actions to Promote Gender Equality in Your Organization
cover base, variable, and total remuneration
levels, starting salaries, and regular and
promotional salary increases.
Each year, Origin conducts a central review
of proposed pay arrangements for the coming
12 months, which covers all divisions and all
levels. The company has also established a
specific trigger point for further review from a
gender-equality standpoint.
“If proposed pay arrangements result in a gender
deviation of more than two percentage points at any
grade the relevant managers are asked to review
all recommendations in that grade with a view
to bringing the deviation below the threshold,"
Origin policy states.
Set targets for female
representation in critical roles.
Origin’s board has set itself a target of having
at least 40% females by 2020. For financial year
2015, it committed to increase the number
of women in senior roles, and
improve the rate of appointment
of women to senior roles by 15%.
(Origin defines seniority by job grade
rather than reporting level to the CEO,
in order to make true comparisons
of seniority and make analysis
meaningful over time.)
Since 2014, Origin has
published a chart displaying
the external appointment
to senior roles by gender, on
an annual basis (see eXHibit 3).
In 2015 the chart showed that
from 2008 to 2015 the company
increased the proportion of
women in senior roles, and noted
that 2015 was “comfortably the
highest ever.”
The third key recommendation of the Gadhia
report was that “executive bonuses should be
explicitly tied to achieving the internal targets which
firms have set for themselves.” Critics of this
approach suggest that setting diversity targets
(and in particular, linking compensation to diversity
targets), may encourage “tokenism” or lead to
“reverse discrimination.” These possibilities do
exist, and the challenges of tying pay to diversity
objectives are real. However, the alternative of
not taking action and simply hoping for patterns
to shift is unlikely to yield much change.
The U.K. Office of National Statistics found
that in 2015 the gender pay gap narrowed
to 9.4% for full-time employees in 2015, the
lowest since records began almost 20 years
ago, but also noted that the differential had
changed little in recent years. Furthermore,
the possibility of “reverse” discrimination
is unlikely to ever surpass the potential for
“regular” discrimination against females
and other groups.
Set targets for female
retention in critical roles.
While appointing women to senior roles is
important, retaining them once they are in such
positions is even more critical. In financial year
2015 Origin committed to improve retention of
women in senior roles, with a target to improve
female turnover in senior roles by 15%.
Since 2014, Origin has published a chart
showing the female turnover in senior roles.
In 2015 the chart showed that female turnover
ratio had generally trended down over the
past eight years (see eXHibit 4). Interestingly
though, over the past year turnover has actually
increased. The company acknowledged this
fact, and provided context in its narrative.
88.
77.
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Refine targets over time.
For 2016 Origin changed its metric for the
retention of women in senior roles, to paint
a truer picture of progress and sharpen its
focus in this area. Specifically, it moved away
from tracking the absolute turnover rate for
females, noting that the turnover rate for senior
women, as for men, had been primarily driven
by economic factors unrelated to differential
treatment by gender.
Instead, Origin moved to measuring the
difference in male and female turnover rates,
with a specific target to reduce the gap between
the turnover rates to zero.
99. 1010. Establish ongoing accountability
for gender equality.
Organizations should develop and publish an
explicit statement describing where account-
ability for gender equality lies.
Origin is clear on this point: “The Board is
responsible for overseeing the Company's strategies
on gender diversity, including monitoring of the
Company's achievements against and gender targets
set by the Board."
Describing the relative roles and responsibilities
of employees, line managers, senior managers,
and human resources is also advisable.
Exhibit 3: FEmAlE APPointmEnt to sEnior rolEs (%), oriGin EnErGy Exhibit 4: FEmAlE turnovEr in sEnior rolEs (%), oriGin EnErGy
22,8 23,4 24,2 25,8 25,7 24,5
32,5
37,3 35,9
FY08
FY09
FY10
FY11
FY12
FY13
FY14
tArget F
Y15
FY15
17,1 16,515,1
13,9 14,0
18,2
13,411,4
14,8
FY08
FY09
FY10
FY11
FY12
FY13
FY14
tArget F
Y15
FY15
FINAL THOUGHTS
Origin has focused on
diversity and inclusion, and
gender equality specifically,
as an organization priority for
over five years.
“We know that partnering with,
and employing, a diverse range of
people will give us access to a range of
perspectives to make the best decisions
today to create value for the future,”
the company said in its 2011 annual
report. In the years since, Origin has
demonstrated its ongoing commitment
to this principle. In a single, concise statement
found on its website, Origin describes not just
its diversity and inclusion philosophy, but
specific targets, actions, and results.
In declaring these elements – boldly and
publicly – the organization provides a blueprint
for others that want to lead in promoting
gender equality, and building a diverse and
inclusive work force.
Following this lead, other organizations can
stop worrying about the risks of examining gender
and pay, and start focusing on the rewards. ∞
We are committed to providing equality of opportunity and a rewarding workplace for all employees.
16 Global Benefits Vision - September 2016
Origin's Diversity and Inclusion Policy
Increasing gender diversity, especially in senior roles, is an ongoing policy priority. Our Diversity and Inclusion Policy guides behaviours and actions, and aims to create an environment in which all individuals are supported and respected.
Our Policy applies to all aspects of employment including recruitment, selection, promotion, training, remuneration, benefits, performance management, and all other terms and conditions of employment. A particular priority is improving gender balance, especially in senior roles.
Our Diversity and Inclusion Policy
guides behaviours and actions, and aims to
create an environment in which all individuals
are supported and respected.
Origin continues to be recognised as Workplace Gender Equality Agency’s Employer of Choice for
Gender Equality. Origin is also the only Australian company to rank in the top 20 in a global Ernst &
Young report1 on gender diversity in the Power and Utilities industry. We were the best performer in the
Asia Pacific region, and ranked fifth globally.
We have also been recognised by Females in IT and Telecommunications (FITT) in its 2015 Diversity Report as the most supportive place for women to work in IT in Australia. Of 30 companies named in FITT’s report,
Origin was chosen as number one for women. To date, women make up 41 per cent of Origin’s IT team compared with the IT sector average of 28 per cent.
Performance against targetsDeliver equal average pay for men and women at each job grade
Average pay for men and women at each job grade fluctuates through the year with turnover, recruitment and promotions, but once a year the Company undertakes a comprehensive review of all aspects of remuneration. In FY2015 the average female pay was higher at some grades than average male pay and lower at others. The average difference between male and female pay across all job grades was within our targeted range of less than one per cent. Job grades are defined using standard Hay Pay Scales.
Gender Pay Gap 1999–2015(Total population weighted average)
Notes:
• Totals are all population weighted (i.e. by the numbers represented at each pay level).• Employment Agreements are bracketed by salary ranges. As the pay rates are fixed, there is no gender
difference at any particular classification, but differences arise from different numbers of male and females in each classification and/or from variation in any skills or other allowances paid.
Gender Pay Gap Table – 30 June 2015Note: Negative pay gaps are where the female average exceeds the male average
Pay Level (job evaluation bands) Female/Male Pay Gap(ppts)
EMT 166.6% -66.6A 104.7% -4.7B 102.3% -2.3C 98.7 1.3D 101.2% -1.2E 99.2% 0.8F 101.2% -1.2G 100.5% -0.5H 99.4% 0.6I (Field Operators) -I 98.8% 1.2J 98.5% 1.5K (Field Operators) 96.5% 3.5L 101.0% -1.0M 100.7% -0.7N 99.5% 0.50 100.0% 0.0P 100.6% -0.6Graded Population 99.8% 0.2Q (paid premium allowances) 99.0% 1.0Graded Population Overall 99.6% 0.4EA Band 3 -EA Band 2 100.1% -0.1EA Band 1 99.3% 0.7
Employment Agreement Population 99.5% 0.5
Total population weighted average 99.6% 0.4
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September 2016 - Global Benefits Vision 17
souRCes
1- Origin Energy Annual Report, Message from the Chairman and Managing Director; 2010
http://reports.originenergy.com.au/2010/downloads/Origin_Energy_Annual_Report_2010.pdf
2- Origin Energy Diversity and Inclusion statement;
https://www.originenergy.com.au/about/our-approach/managing-our-business/diversity-and-inclusion.html
3- “Nowhere left to hide for gender inequality”; Press release 12 February 2016; Government Equalities Office and The Rt. Hon Nicky Morgan MP
https://www.gov.uk/government/news/nicky-morgan-nowhere-left-to-hide-for-gender-inequality
4- The Male Champions of Change home page;
http://malechampionsofchange.com/
5- Empowering Productivity; Harnessing the Talents of Women in Financial Services;
http://uk.virginmoney.com/virgin/assets/pdf/Virgin-Money-Empowering-Productivity-Report.pdf
6- 2014-15 public report form submitted by Origin Energy Limited to the Workplace Gender Equality Agency;
https://www.wgea.gov.au/sites/default/files/public_reports/tempPublicReport_pylgw8ex8a.pdf
7- 2013-14 public report form submitted by Origin Energy Limited to the Workplace Gender Equality Agency;
https://www.wgea.gov.au/sites/default/files/public_reports/tempPublicReport_5xmw1n8oli.pdf
8- Origin Energy Annual Report; 2011
http://reports.originenergy.com.au/2011/images/uploads/Origin_Annual_Report_2011_web.pdf
9- Office for National Statistics;
http://visual.ons.gov.uk/what-is-the-gender-pay-gap/
FY2015 voluntary targets
The Company committed in FY2015 to:
1. continue to deliver equal average pay for men and women at each job grade;
2. increase the number of women in senior roles, with a target to improve the rate of appointment of women to senior roles by 15 per cent; and
3. improve our retention of women in senior roles, with a target to improve our turnover rate among women in senior roles by 15 per cent.
Progress against these targets is
reported internally on a quarterly basis
to the Diversity Council comprising the
Executive Management Team and chaired
by the Managing Director.
Setting TargetsTargets for FY2016
Origin’s targets for equal pay and for
senior appointments will remain the same
as last year.
However, Origin’s turnover target will
change. In recent years Origin has targeted
a 15 per cent year on year reduction
in turnover of senior women. However
our turnover rate for senior women,
as for men, has been mainly driven by
economic factors unrelated to differential
treatment by gender.
For FY2016, the Company will instead
measure the difference in male turnover
and female turnover rates among our
senior employees, with a target to reduce
the gap between female and male turnover
to zero. While male and female turnover
is strongly correlated, female turnover in
senior roles has on average been higher
than male turnover for most of the last
ten years. In FY2015 the turnover rate for
women in senior roles was 1.8 percentage
points higher than the male rate.
In summary Origin’s targets for FY2016 are:
1. continue to deliver equal average pay for men and women at each job grade;
2. improve the proportion of senior roles occupied by women, with targets to: • improve our rate of appointment of women to senior roles by 15 per cent
compared to FY2015; and
• reduce the gap between female and male turnover rates to zero.
The Board is responsible for overseeing the Company’s strategies on gender diversity,
including monitoring of the Company’s achievements against any gender targets set by the
Board. The Board has set itself a target of having at least 40 per cent females by 2020.