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Expat benefit culture out of control say multinationals
| Published: | 2 Nov at 6 PM |
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As expat workers become more mobile, with many heading to the burgeoning Asia Pacific region, multinational companies are become concerned about the legal and financial implications of the overseas expat benefit culture.
Many international firms are attempting to claw back control from local operators of the perks and benefits offered to professionals seeking jobs overseas. A recent study, undertaken by human resources business Aon Hewett, has revealed that companies are allowing local branches to offer rewards which may not coincide with the firm’s corporate strategy.
Less than one in every ten HR managers are confident their employers are able to competently manage risk and costs, with managers in 20 per cent of companies stating concern that corporate guidelines are not being taken into consideration in local decision-making. The survey, by the American Benefits Institute (ABI) for Aon Hewitt, suggests that companies need to exert stronger influences over the size of remuneration packages and other benefits made by local branches.
According to James Klein, ABI president, today’s multinationals face compliance and strategic challenges caused by soaring globalisation in their positions as employer-sponsors of expat benefit plans. In order to continue their commitment to retirement security and health coverage, he continued, they will need to successfully manage the increasing risks of plan coverage.
Klein also noted that recent centralisation of benefits control is already mitigating a number of challenges by simply improving communication between overseas branches and head offices. For Aon Hewitt, Amol Mhatre agrees, saying that firms wishing to create more sustainable levels of benefits programmes will need a formalised governance structure geared towards management of operational risks and costs.
Many international firms are attempting to claw back control from local operators of the perks and benefits offered to professionals seeking jobs overseas. A recent study, undertaken by human resources business Aon Hewett, has revealed that companies are allowing local branches to offer rewards which may not coincide with the firm’s corporate strategy.
Less than one in every ten HR managers are confident their employers are able to competently manage risk and costs, with managers in 20 per cent of companies stating concern that corporate guidelines are not being taken into consideration in local decision-making. The survey, by the American Benefits Institute (ABI) for Aon Hewitt, suggests that companies need to exert stronger influences over the size of remuneration packages and other benefits made by local branches.
According to James Klein, ABI president, today’s multinationals face compliance and strategic challenges caused by soaring globalisation in their positions as employer-sponsors of expat benefit plans. In order to continue their commitment to retirement security and health coverage, he continued, they will need to successfully manage the increasing risks of plan coverage.
Klein also noted that recent centralisation of benefits control is already mitigating a number of challenges by simply improving communication between overseas branches and head offices. For Aon Hewitt, Amol Mhatre agrees, saying that firms wishing to create more sustainable levels of benefits programmes will need a formalised governance structure geared towards management of operational risks and costs.
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