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

50

September 2016 - Global Benefits Vision 3

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68 Index of Articles

3

Table of Contents

60 News

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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

global-benefits-vision.com

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 rob.paton@aonhewitt.com

aon HewittPerformance, Reward and Talent Leader

global-benefits-vision.com

Profiles of Contributors

elin bRedenbeRg elin.bredenberg@aonhewitt.com

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.

© xx

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Actions to Promote10in Your Organization

Gender Equality

September 2016 - Global Benefits Vision 11

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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

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06

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07

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09

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11

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12 J un

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13

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Exhibit 2: GEndEr PAy GAP, oriGin EnErGy (totAl PoPulAtion wEiGhtEd AvErAGE)

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September 2016 - Global Benefits Vision 13

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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.

September 2016 - Global Benefits Vision 15

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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

global-benefits-vision.com

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.