tools & resources

Global Benefits Governance Toolkit

As their international workforces continue to grow, global companies are made especially aware of the importance of defining corporate policies and practices. In addition, cultural factors unique to different regions of the world as well as increased government scrutiny and regulations are challenging multinationals to implement institutional safeguards and, generally, pay closer attention to their governance. But even apart from the external pressures bearing down on them, companies are addressing governance for other important reasons: to achieve best practices and the financial and other rewards that ensue by having healthy internal processes.

Companies recognize the need to identify the inter-relationships between management levels, and the need to improve transparency with shareholders and the appropriate government entities. Indeed, governance encompasses virtually all areas of a company’s structure and its operating methods. However, the area of most concern to members of the Global Business Group on Health (GBGH) is benefits governance, which includes the structures and processes that relate to health care, life insurance, pension and retirement plans. Many members have constructed a framework for governance, and they are looking for guidance and direction to refine it. According to the 2016 Aon Hewitt Global Benefits Governance and Operations Study report, only a third of responding companies know what their global plan costs and risks are with substantial understanding drop off in non-priority markets.

The Global Business Group designed this resource to share tools and to answer questions members have about governance. The material was gathered from survey results, benchmarking calls and interviews. Member identities have been removed from all of the contents, including the case studies, to protect company confidentiality.

Defining Governance

Toolkit Elements and Content

The toolkit has been organized to illustrate how some member companies have approached the different areas of governance. Each major area contains descriptions extracted from interviews, as well as actual samples of documents, charts and graphics provided by member companies. Each company is denoted by the use of a letter and is described through four categories of information: company type, employee population size, number of countries with operations and governance structure.

Governance structures are defined as the following:

Decentralized: Decisions on plan design and vendor selection are made locally with minimal or no input from corporate HQ.

Regionally centralized: Decisions are taken at a regional level but not necessarily reported back to corporate HQ.

Partially centralized: Some decisions are reported to corporate HQ based on established dollar limits or other agreed upon thresholds.

Centralized: All decisions regarding benefits outside the US must be approved by the corporate HQ prior to implementation.

  • Checklist to Guide the Governance Process: a guide to assist members in developing, implementing and managing a governance structure for global benefits.
  • Global Philosophy and Strategy: the underlying idea(s) that drives a company's approach to governance and how it is implemented.
  • Organizational Structures: whether a company's governance structure is centralized, decentralized, regionally centralized or partially centralized.
  • Approval Matrices: lines of authority for signing off on compensation and benefits.
  • Other Governance and Tracking Tools: how legal and regulatory compliance matters are handled; and the use of audits and other internal or external mechanisms for monitoring the levels of success of governance processes.
  • Communications: members discussed communications in their interviews and that content is shared throughout the various elements of the toolkit. Common themes also emerged and are summarized here.
  • Audits: this topic was not discussed in length by members in their interviews although the sample tools contributed by members are included in the "other governance and tracking tools" element of the toolkit. A summary of common themes is provided.
  • Case Studies: narratives on two member companies that provide greater depth into all facets of governance. Most material from the case studies also appears in the relevant toolkit element. But content that doesn't readily fit into any particular element is shared in these cases.
  • Key Learnings: narratives on two member companies that provide greater depth into all facets of governance. Most material from the case studies also appears in the relevant toolkit element. But content that doesn't readily fit into any particular element is shared in these cases.
  • Complete Survey Results: highlights employer benchmarking data on global benefit governance policy and practices.

 

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Full Toolkit in PDF Format

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