Employers are crucial to super success
10 November 2011
Employers are crucial in engaging members in their superannuation and encouraging them to become involved with their retirement planning, according to Scott Hartley, Managing Director of Plum Financial Services.
Speaking at today’s Annual Conference of the Association of Superannuation Funds of Australia (ASFA), Scott said, “At Plum, we see the role of the employer as one of the most critical in terms of members achieving successful retirement outcomes.
“The recent super reviews have been largely silent on the role of the employer in super. They have focussed on increasing efficiency, reducing the costs for members and analysing the correct investment strategy – all important, worthwhile objectives – but the role of the employer has been largely overlooked. It has not been widely debated, recognised or valued.
“The common belief is that adequate retirement outcomes are easily achieved as a result of low fees and high returns but it’s not that simple. If our objective is to deliver the ‘best possible retirement outcome’ for members, then there is so much more we can and must do.
“Our experience has shown that the single biggest factor in achieving retirement adequacy is member engagement. And increasing member engagement often starts with the employer.”
Mr Hartley says the task of engaging members is difficult if employers are not supportive.
“Behavioural science tells us there is a small proportion of the community who will engage with their financial future but most people are complacent and don’t care. It takes a lot to break through that complacency. They need to be engaged and employers are critical to this process of engagement.
“In Plum’s experience, successful partnerships rely on having access to the members through their established workplace communication channels such as intranet sites and company newsletters.
“Importantly, personal contact between education specialists, financial advisers and members really builds the engagement. In our experience, where we have a high level of involvement from employers in engaging with members, we are guaranteed to get a better result.”
Scott said Plum has a proven track record in successfully engaging its 200,000 members in their super and assisting them in achieving a better retirement outcome. For example, Plum members belonging to the 80 corporate plans it administers contribute an average of 15 per cent to their super and more than 40 per cent of members make voluntary contributions.
“If employers are prepared to enthusiastically embrace this and really engage with their employees in assisting their retirement planning they do see results. Importantly, most employers feel good if their employees are achieving positive results.
“For member engagement to be effective, super must be seen as an important part of their employment offer.”
Plum’s committed clients integrate super into their workplace through a variety of activities, for example,
- by making super a central element of the remuneration and benefits offer;
- introducing members to super as part of on-boarding and induction;
- having super worksite champions;
- including super messages in internal communications including on the intranet;
- having onsite support including education and advice and presence at staff expos; and
- involving spouses in super education.
“These are just a few of the many ways the employer and provider can work together to support members and really focus on helping them achieve retirement adequacy. Importantly, the power of engagement is very positive when employers start to see real results,” Mr Hartley said.
About Plum
Plum Financial Services Limited (Plum) provides integrated and innovative superannuation solutions to medium and large Australian organisations. It is a subsidiary of MLC Limited, one of the National Australia Group of companies, and has a strategic alliance with the US-based Vanguard Group Inc., the world's second largest mutual fund manager. Plum manages superannuation for 80 of Australia’s largest corporations and has almost 200,000 members.
For further information contact:
Penny Repse, Public Relations and Marketing Consultant,
Tel: 03 9222 4597 Mob: 0439 995 850
penny.c.repse@plum.com.au or
Georgina Slade, Public Relations and Marketing Consultant
Tel: 03 9222 4640 Mob: 0438 565 774
georgina.slade@plum.com.au
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