After a long decline in the number of organizations investing in executive benefits, new research suggests a turnaround.
A recent report from Goldman Sachs Ayco found that nearly a quarter of the almost 300 compensation and benefits professionals surveyed have enhanced their executive benefits offerings in the last two years. This is significantly more than the 20-year average of 8%.
And more investment is expected: Twenty percent anticipate introducing more executive benefits in the next two years, compared to just 5% that envision eliminating offerings.
Report authors say the shifts have the executive benefits landscape “inching toward or beginning to exceed” rates of prevalence not seen since before 2005. In the mid-2000s, the economic crisis and more stringent regulatory requirements prompted sharp downturns in executive benefits offerings.
Economic and geopolitical uncertainties, researchers say, are likely influencing employers to reexamine and reinvest in their executive benefits.
But what are they prioritizing?
Financial counseling was, by far, the most commonly added benefit for executives, followed by executive physical exams and tax prep support. About 10% now offer personal security for execs, and 7% do so for their homes.
When it comes to benefits in consideration, personal security ranks second, following financial counseling services.
Crafting a strategic benefits strategy
When considering changes to executive benefits, HR should aim to architect offerings that are “competitive, defensible, compliant and well-communicated,” backed by data-driven benchmarking, says Jonathan Barber, head of Compensation & Benefits Solutions at Goldman Sachs Ayco.
“Priority should be placed on those benefits that are most commonly offered within a particular industry to attract/retain talent and those benefits that provide a mutual benefit to both the executive and to the organization/shareholders,” Barber says. These typically focus on executives’ physical health, financial health and safety, along with compliance, efficiency and risk mitigation.
“The idea is to allow the executive to focus on the job at hand by minimizing disturbances and maximizing peace of mind,” Barber says.
See also: 6 trends shaping the future of retirement plans
HR needs to “proactively and effectively” communicate the offerings to executives to drive utilization, he adds.
Communication is also critical to earning shareholder buy-in for adding or enhancing benefits. Tell the story of the business impact of such offerings—including by leveraging benchmarking studies and risk assessments—to ensure the benefits aren’t viewed by decision-makers as “status rewards.”
“The more ‘boxes’ the benefit checks as to why it not only supports the executive but also provides organizational value,” he says, “the easier it is to defend.”
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