Navigating the future of employee benefits with MBWL’s Global Benefits Forecast
As the global landscape evolves, organisations are refining their employee benefits strategies to meet new challenges and opportunities.
MBWL’s third annual survey, earlier this year, based on responses from over 140 multinationals across various industries, provided some key insights into the latest trends and priorities influencing global benefit strategies and policies.
ESG and DE&I as cornerstones of a modern benefits strategy
Environmental, social and governance (ESG) considerations, along with diversity, equity and inclusion (DE&I), are integral in shaping benefits strategies.
Organisations are prioritising initiatives that promote healthy lives, workplace safety and DE&I, reflecting a holistic approach to employee well-being and organisational responsibility.
The focus on DE&I is noteworthy, with age/generational and equity across job grades being top areas of concern, although employers’ attention towards those areas has decreased over the last two years.
Governance and global standards: a mixed bag
Our analysis indicates a downward trend in how developed the governance structures for global benefits are, especially among multinationals headquartered in Europe and Asia-Pacific.
Global minimum standards for benefits are widely applied, most commonly for flexible/hybrid working arrangements, employee assistance programmes (EAPs), life coverage, parental leave, and healthcare benefits.
These standards help uphold equity and fairness in employment and enhance employer branding.
Offering benefit choices: a complex but desired aspect
Benefit choice adds complexity to benefits strategy design, yet most organisations are either offering or keen to offer flexible benefits to cater to individual needs.
Flexible benefit plans can offer a range of benefits that employees can choose from, based on their personal circumstances and preferences.
Despite the challenges, our findings suggest organisations are willing to overcome these to offer more personalised benefit plans to meet employees' diverse needs.
Flexible and hybrid working: the new norm
Flexible and hybrid working arrangements have become the most valued benefits for employees, surpassing even healthcare benefits, highlighting the lasting impact of the Covid-19 pandemic on work preferences.
The shift in both employee and employer perspectives suggests that flexible working is not just a temporary trend but a fundamental change in how work is structured.
Hybrid working policies often differ by country and team, reflecting local requirements and team-specific needs.
Cost and communication: persistent challenges
Despite the growing importance of comprehensive benefits, cost remains a significant barrier to the implementation of benefits globally.
Our survey reveals that cost considerations overshadow other aspects such as attraction/retention, market benchmarking findings, and employee fit during the design and review of benefits.
Communication emerged as the top challenge to successful employee benefits engagement. Inadequate or unclear information can hinder the effectiveness of even the best-designed benefit programs.
Embracing AI: the future of employee experience
AI is rapidly transforming the workplace, and our findings highlight the growing role of AI and technology in the benefits space.
Many organisations indicated they are likely to utilise AI technology in the future and expressed interest in using AI for various functions, including producing communication materials, automating administrative processes, and answering employee questions.
Key takeaways
To navigate the complex landscape of global employee benefits, organisations should:- Ensure governance is fit for purpose: align governance protocols with organisational structure and priorities across programs and countries, focusing on ESG, DE&I, and flexibility.
- Consider fresh benefit reviews: regularly assess benefit programs and HR policies to ensure they remain compliant to local regulations and reflect new trends, priorities, and global minimum standards to remain competitive and relevant to employees. Understanding the benefits plans you are offering is key to identifying where improvements can be made.
- Understand and predict benefit costs: collect key and actionable data for analysis, and challenge insurers, advisers, and brokers to provide better insights and services. This will help organisations to identify more cost-effective ways to offer benefit programs that fit their employees’ needs.
- Leverage scale: this can include multinational pooling and EB captives for financial gain and improved coverage and governance, or reviewing and implementing global initiatives e.g. EAP, reimbursement accounts, financial wellbeing, benefit platforms, etc.
- Prioritise communication: use a variety of communication strategies to engage employees effectively, leveraging both traditional and AI-driven approaches. We expect to see leading HR teams take advantage of technological developments in the use of AI to enhance the employee experience, including in the benefits space.
The 2024 MBWL Global Benefits Forecast underscores the importance of a strategic and flexible approach to employee benefits.
By prioritising ESG and DE&I, embracing flexible working, addressing cost and communication challenges, and leveraging AI and technology, organisations can create a benefits strategy that supports their diverse workforce and aligns with their broader goals.
In partnership with Barnett Waddingham
Everything we stand for at Barnett Waddingham is embedded in our promise – to do the right thing. We’ve applied this meaningful principle across all aspects of our business with continued success.
