Aon International Retirement Monthly Newsletter – October 2020

Welcome to October's edition, and as we enter what is the busiest quarter for many organisations in a year which has flown by despite lockdown in much of the world, I hope you will have time to read, listen to and watch some interesting pieces from all over the globe. Highlights this month include our white paper on the potential impact on markets of a Biden presidency, several items of interest from Ireland including their DC Pensions Survey and a webinar and toolkit exploring issues facing Irish employees approaching retirement, and a registration link for this week’s International Retirement webinar covering France, Italy and Spain, as well as some information on past and upcoming industry events hosted in Germany and the Netherlands.

As ever, please do let us know of any feedback or what you'd like to hear more of.

From Colin Haines, Partner, International Retirement & Investment

SURVEYS AND THOUGHT LEADERSHIP

Global

Aon and Willis Towers Watson combination: "Helping Clients Navigate an Increasingly Complex World"
The combination of Aon and Willis Towers Watson, which remains subject to customary regulatory and other closing conditions, is expected to close in the first half of 2021. Greg Case, Aon CEO, and John Haley, Willis Towers Watson CEO, have co-authored a white paper on how the combined firm will help clients navigate today's challenges and together tackle some of the greatest issues facing society, including global retirement savings.

NEW!! International Discount Rates Newsletter
With the economic impact of Covid-19 starting to ease (for now), we turn our minds to the influence this may have on multinational employers’ worldwide pension liabilities. In our new quarterly International Discount Rates Newsletter, we cover how discount rates, inflation rates and investments are evolving in 2020, including details and consequences of Covid-19.

2019 Global Accounting Assumptions Survey
As the 2020 year end approaches, our annual survey of global IAS19/US GAAP accounting assumptions will be of use to companies when setting preliminary assumptions for 2020 year-end and budgets for 2021.

Rising Resilient (including Financial Wellbeing)
In our brand-new thought leadership, Rising Resilient, we connect the dots between purposes, health, wealth and productivity and help HR functions articulate why wellbeing is important and how it impacts the overall resilience of a workforce, creating a call to action for more businesses to adopt progressive practices around wellbeing. The report includes financial wellbeing practices and the implications for employee long-term savings. Click here to view the microsite and download our report.

International Pension Plans Resilience Survey
International Pension Plans (IPPs) have often been used to great effect to solve the complexities of providing retirement benefits to mobile employees –with a particular focus on populations such as rotators and career expats. But with the majority of IPPs being defined contribution, how are they responding to recent financial market volatility and what should sponsor employers do now? We have insights from our IPP Resilience Survey.

Americas

US: The Defined Contribution (DC) Plan of the Future
As defined contribution plans have replaced defined benefit plans for many employers, defined contribution plans have evolved from being an option to help employees make it to retirement to one that will take them through retirement. This paper highlights how Aon believes the defined contribution plan will transform over the next decade and how plan sponsors can best embrace change that improves retirement outcomes.

US: The Real Deal for Public Sector Plan Sponsors
Retirement readiness for public sector employees often includes many unique considerations. As retirement plans evolve in the public sector, the retirement income adequacy picture for employees covered by these plans has changed over the generations. Aon's new short white paper on measuring retirement readiness through Aon’s The Real Deal can help public sector plan sponsors understand and address these issues.

Asia-Pacific

Japan: Amendments to the DC Pension Act
A new law to strengthen the pension system was enacted on May 29, 2020 and promulgated on June 5. The aim is to improve the economic foundation of the system and secure post-retirement income in an environment where employees stay in employment longer and the population is aging. Find out more in Aon's white paper.

Philippines: Retirement Benefit Survey now available
We have completed a comprehensive study covering all aspects of retirement plan design in the Philippines, as there is a clear direction of travel to provide employees with retirement and other financial wellbeing support outside of the statutory minimum. Click here for more details on how to access the report.

Singapore: Financial Wellbeing Survey – to be published soon
Many thanks to those who participated in our Singapore Financial Wellbeing and Retirement Survey. Results will be published soon; please click here to send an email to register interest in receiving the results.

Thailand: DB Valuation Trends
Aon Thailand’s Valuation Trends is a biennial study that examines the assumptions and experiences of retirement plans under global and local accounting standards. The report provides a snapshot of the changes in financial and demographic assumptions used to value the liabilities based on accounting disclosures for years ending in 2019. Click here to request a copy of the report.

EMEA

UK: De-risking market – Does size really matter?
Aon's Risk Settlement Group presents findings from research carried out earlier this year in conjunction with Professional Pensions. The aim was to understand trustee and employer views on the de-risking options available to them. Is the full range of options understood and are there any preconceptions about the ease of accessing the options for schemes of different sizes? Find out here.

Germany: Digital Pension Dashboards – webinar
Join Aon Germany’s retirement leadership team, Government ministers, BMW Group and other senior industry contacts for a digital seminar on 28 October. Pension Dashboards are a recurring topic in many European countries – some as Sweden, Denmark, Belgium and the Netherlands have introduced them already; the UK and Germany are next in line to implement such a platform setting the scene for future pan-European overviews. Aon helped the German government in 2018/19 to analyse the need for such a platform and to describe the conceptual framework and foundations. Now draft legislation has been published by the German government – intended to be enacted by the year end and based to a large extent on Aon’s insights and proposed structure. When the law is enacted by end of 2020, a pilot will go live by end of 2022 and the platform will be fully functional in 2023 with further extensions for the years to come. Click here for more information and to register for the webinar; or contact Andre Geilenkothen to find out more about the project. (The seminar will be in German)

Ireland: DC Pension Survey 2020
Aon Ireland presents a comprehensive view of where Irish DC pensions schemes are currently, and where trustees and employers would like them to be. View the full report here, and there is also a recording of a recent webinar in which the highlights were presented.

Ireland: Key considerations when approaching retirement – webinar and toolkit
This on-demand webinar plus toolkit explores the issues facing Irish employees approaching retirement, helping to support employees to better manage their future financial situation.

Netherlands: Pension Reform & Communications
The major new Dutch pension reforms are now attracting significant interest from companies as action for reforms should be planned now. Certainly, those who have DB plans should revise their schemes, and many may want to consider introducing age-related DC plans for existing members before the end of 2021. Over 500 contacts recently attended a local Aon seminar on the reforms. Speakers from DNB (The Dutch Banking, Insurance and Pensions supervisor), unions, insurance companies, clients and Aon experts were present. Click here to access the materials for Pension Funds, employers and Work Councils; and click here to access the Aon microsite which has a wide range of information (in Dutch). A summary in English can be found here. Contact Heleen Vaandrager for more information or to arrange a call with a local consultant to receive a free Impact Analysis.

GLOBAL INVESTMENT ROUND-UP

Aon Investments has published several new pieces of thought leadership which may be of interest, including:

Asset Allocation White Paper on Potential Impact of Biden Presidency
The looming U.S. presidential election is likely to be an important driver of market volatility in the near term. In this new white paper, Aon’s global asset allocation team discusses the potential market impact from a Biden presidency.

What to Make of Current Market Conditions – September 2020
The powerful recovery in US stocks since the brief bear market in March has far exceeded everybody’s expectations. Risk assets have decoupled from falling profits and rising default rates in extraordinary fashion, a world apart from the last market downturn in 2008. This impressive achievement owes partly to the size and speed of stimulus and market backstopping from policy makers, a multiple of that seen in 2008. To learn more, read the full article.

Responsible Investment (ESG)
Responsible Investing is becoming more and more important to organisations we partner with. Pension schemes’ needs and demands in this space vary across the spectrum. We are pleased to share a brochure examining why Responsible Investing is moving higher up pension agendas and outlines the different services we offer to clients to help them meet their RI objectives.

Aon also runs a Responsible Investment Network for UK and European investors. The Network met on 28 September where Aon's Tim Manuel explored the role investors can play to drive positive change through effective engagement and stewardship. He was joined by Sarah Faivre-Ovion of bp – who discussed the role investors played in the development of bp's strategy to transition to an Integrated Energy Company – and Tegs Harding, a professional trustee from ITS, who considered the case for engagement from a trustee perspective. Please contact Tim Manuel for more information on the network and to join future events.

UPCOMING EVENTS

International Hot Topics Webinars

Register for Aon's forthcoming International Retirement webinars via the links below:

We are already starting to plan for our 2021 programme, so if there are any locations you would especially like to learn more about, let us know.

Norway: Pension Reforms – Personal Accounts – webinar on 13 October (12pm CET)

Key changes are in process in the Norwegian pension system which will affect employers as well as employees, due to employers’ duty to inform. Click here to learn more and register for the webinar (in Norwegian). Contact Oystein Mathiassen in Aon Norway for more information.

UK: Pension and Lifetime Savings Association (PLSA) Annual Conference – 12 to 16 October

Aon will be sponsoring the Defined Benefit section of this year's PLSA (virtual) Conference. The Conference will address the “challenge to provide financial wellbeing for savers, provide financial products that work for a new type of retirement, invest in a way that protects our environment and society, and learn to withstand future shocks [that] has never been greater.” Confirmed speakers include Torsten Bell, Tony Burden, Martin Lewis, and David Olusoga. More information is available here.

UK: "Rocky 2019 and Rollercoaster 2020" Accounting Strategy Webinar – 21 October (4pm UK time)

With the end of 2020 fast approaching, pension schemes are being truly tested as the COVID-19 pandemic unfolds. 2020 year to date has been a rollercoaster ride, with wild fluctuations in investment markets. We are also expecting some critical announcements in Q4 which will add more volatility and time pressures on reporting, primarily on the government response to its RPI reform consultation and the awaited ruling from the second GMP Equalisation court case ruling on transfers. Now is the time to take control of your accounting positions and be ready to deal with any scenario that Q4 may bring – learn more by registering here.

UK: Aon's Investment Conference – 9 to 13 November
Covid, climate and compliance – are you ready for the new investment challenges?

This year's virtual conference will cover sessions including the following:

Please click here to view details and register!

PODCASTS AND WEBINAR RECORDINGS

As usual, we have a range of recent recordings for you to catch up on – starting with the International Retirement Hot Topics series, all of which are held in English and cover various trends in retirement benefits and financial wellbeing with suggested action points for employers:

You'll see we have focused much of this quarter on Asia Pacific – if you would like to get in touch with the team there to discuss any content or topics on your agenda, click here.

You or your colleagues may also be interested in accessing these recent webinars, available in local language:

LOOKING FOR MORE?

Visit the Retirement and Investment Solutions page for more insights, and Aon's Global Retirement Updates for the latest legislative developments.

If you'd like to receive any of our previous newsletters, please contact us.