Healthcare and flexible/hybrid working most valued benefits

Healthcare and flexible/hybrid working are the most valuable benefits for multinational companies’ employee value propositions, while ESG and diversity, equity and inclusion (DE&I) continue to be important considerations for benefits strategies. This is according to global pensions and employee benefits consulting firm MBWL International.

The firm’s 2024 Global Benefits Forecast explores the top employee benefits issues that multinational organisations are prioritising for their workforce. It found that global benefits management and governance has become less effective and more challenging, with cost and employee communication continuing to be significant issues.

“We continue to see significant economic and political uncertainty around the world,” says John-Paul Augeri, managing director and global EB consulting leader at Milliman. “Employee benefits remain critical to the employee value proposition worldwide, and increasingly challenging to get right. It is incredibly important for multinationals to review their approach to global benefits management and strategy, to optimise return on investment and maximise their limited time and resources.”

While almost half (49%) of organisations believe the management and governance of their global benefits is well developed, this figure is down from 61% last year and down even further from the year before, the survey found. It added: “There is therefore a clear downwards trend and the data seems to indicate that the development of governance structures around benefits has slowed down overall.”

Cost remains by far the most important aspect that organisations consider when designing and reviewing benefits. “The cost-of-benefit programmes slow down initiatives, and organisations are forced to divert their attention from meaningful employee-focused aspects of design,” said MBWL. It added that inadequate or too little communication is the challenge listed by most organisations, together with a lack of manager training and a lack of people resources and budget for programmes.

Isabel Coles, head of international consulting at MBWL International, said: “Global benefits leaders are facing an ever-changing set of challenges, and we see their priorities are evolving accordingly. With the right strategies and governance, we believe there is great opportunity for these leaders to add tremendous value to their organisations and employees worldwide.”

The survey revealed that three-quarters of respondents have set global minimum standards for flexible/hybrid working, with global minimum standards for employee assistance programmes (EAPs), life cover, parental leave and healthcare also prevalent.

In terms of ESG, over the last three years of the survey, employee health and wellbeing, safety in the workplace and DE&I have consistently occupied the top three spots for aspects of ESG that influence benefit strategy, and this year was no different, said MBWL.

“Initiatives that focus on the individual employee appear to be more relevant to benefit strategies than those aspects of ESG that contribute to wider society. Initiatives supporting employee wellbeing and workplace safety continue to be top of mind for organisations, as well as a sustained focus around DE&I issues. Although it remains likely that employers will continue to align their benefits strategies with wider organisational goals around ESG, the evidence over the last few years seems to suggest that the magnitude of ESG’s contribution has plateaued, said the firm.

MBWL said the key takeaways from the survey in terms of what organisations should do next are:

• Ensure governance is fit for purpose, across programmes and countries, and is aligned to organisational structure and priorities;
• Do more to understand and predict benefit costs by identifying key barriers and focusing on collecting key, actionable data for analysis. And challenge insurers, advisers and brokers to do better;
• Prioritise ESG, DE&I and flexibility in governance protocols: Where are the current shortfalls? What is the desired state?
• Consider fresh benefit reviews: Do benefit programmes globally reflect your new priorities, e.g. DE&I, healthcare, flexibility, global minimum standards?
• Communicate better: leverage providers and tailor to local needs, and embrace a range of approaches – from traditional to latest AI technology.

The survey received responses from 147 multinationals with employees in more than 100 countries, representing 17 different industries.