Attracting and retaining through Compensation and Benefit in Asia MS. GODELIEVE KROONENBERG, Market Business Leader, Mercer’s Information Solutions

1. H E A L T H W E A L T H C A R E E R
D E C O D I N G A S I A
I N S I G H T S I N T O T H E W O R L D ’ S
F A S T E S T E M E R G I N G R E G I O N
NOVEMBER 2015
Godelieve van Dooren
Information Solutions Leader – ASEAN

2. © MERCER 2015 1
A G E N D A
• SETTING THE CONTEXT – AN ASIAN VIEW
– ECONOMIC OVERVIEW
– TALENT LANDSCAPE
• USING INNOVATIVE REWARDS TO ATTRACT AND RETAIN TALENT
• LOOKING AHEAD – WORKING IN 2020

3. © MERCER 2015 2
© MERCER 2015 2
SETTING THE CONTEXT
ECONOMIC OVERVIEW

4. © MERCER 2015 3
E C O N O M I C I N D I C A T O R S F O R 2 0 1 5
R E G I O N A L P E R S P E C T I V E
GDP
Inflation
Unemployment
2.8%
2.3%
7.5%
GDP
Inflation
Unemployment
1.6%
2.9%
10.7%
GDP
Inflation
Unemployment
4.8%
2.7%
3.9%
MIDDLE EAST
GDP
Inflation
Unemployment
5.0%
5.2%
9.4%
GDP
Inflation
Unemployment
2.4%
9.1%
6.2%
GDP
Inflation
Unemployment
1.8%
0.5%
6.1%
AFRICA
LATIN AMERICA
NORTH AMERICA
ASIA
EUROPE

5. © MERCER 2015 4
A S I A A S A N E C O N O M Y H A S T R E M E N D O U S
P O T E N T I A L B E C A U S E …
ASIA
By 2050, Asia will account for 45% of
the world population
From 2000 – 2010, incomes rose on average by 96%
and are forecast to rise 45% further by 2016.
The region has been resilient through the global
financial crisis and has experienced consistent average
annual GDP growth rates between 5% to 8%
This will add 1 billion new
consumers and a total purchasing
power in excess of $10 trillion
Asia will house one of the youngest and
largest workforces, numbering around 3
billion and representing 52% of the global
workforce
9 of the 10 fastest growing mega-
cities in the world are in Asia
The ASEAN Economic Community (AEC)
is poised to launch in 2015
Source: Forbes 2014

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B U T T H E R E I S T U R M O I L I N C U R R E N C I E S
E X C H A N G E R A T E V A R I A T I O N
S E P T E M B E R 2 0 1 4 – S E P T E M B E R 2 0 1 5
1 USD =
Country Currency September 2014 September 2015 % of change
Russia RUB 36.94 65.86 78%
Singapore SGD 1.25 1.41 13%
Malaysia MYR 3.16 4.18 32%
China CNY 6.16 6.37 3%
Indonesia IDR 11695.90 13869.60 19%

7. © MERCER 2015 6
A N D I S I T N O T A L W A Y S T H A T E A S Y T O D O
B U S I N E S S
Economy
Ease of
doing
business
rank
Starting a
business
Dealing
with
construct-
ion permits
Getting
electricity
Registerin
g property
Getting
credit
Protecting
investors
Paying
taxes
Trading
across
borders
Enforcing
contracts
Resolving
insolvency
SG 1 3 3 6 28 3 2 5 1 12 4
HK 2 5 1 5 89 3 3 4 2 9 19
NZ 3 1 12 45 2 3 1 23 21 18 12
MY 6 16 43 21 35 1 4 36 5 30 42
KR 7 34 18 2 75 13 52 25 3 2 15
AU 11 4 10 34 40 3 68 44 46 14 18
TW 16 17 7 7 31 73 34 58 18 84 16
TH 18 91 14 12 29 73 12 70 24 22 58
JP 27 120 91 26 66 28 16 140 23 36 1
SL 85 54 108 91 145 73 52 171 5 135 59
CN 96 158 185 119 48 73 98 120 74 19 78
VN 99 109 29 156 51 42 157 149 65 46 149
PH 108 170 99 33 121 85 128 131 42 114 100
PK 119 105 109 175 125 73 34 166 91 158 71
ID 120 175 88 121 101 86 52 137 54 147 144
BG 130 74 93 189 177 86 22 100 130 185 119
IN 134 179 182 111 92 28 34 158 132 186 121
Source: Mercer HR Atlas Asia Pacific 2014 Edition

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W I T H D I S P A R A T E Q U A L I T Y O F L A B O U R
Country Overall Rank Education Rank
Health &
Wellness Rank
Workforce &
Employment
Rank
Enabling
Environment
Rank
Advanced economies
SG 3 3 13 2 5
NZ 12 5 15 17 18
JP 15 28 10 11 13
AU 19 13 18 19 23
KR 23 17 27 23 30
Emerging & developing economies
MY 22 34 39 18 22
CN 43 58 65 26 47
TH 44 79 40 27 48
SL 50 51 35 62 70
IN 53 61 84 32 58
PH 66 65 96 38 78
ID 78 63 112 49 67
PK 112 111 115 104 95
VN 70 73 88 57 73
BG 110 104 104 103 110
Source: Mercer HR Atlas Asia Pacific 2014 Edition

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 AEC Blueprint: Signed in 2007
To “establish ASEAN as a single market and production
base with the goal of making ASEAN more dynamic and
competitive.”
 Four Pillars of AEC
1. Single Market and Production Base
2. Competitive Economic Region
3. Equitable Economic Development
4. Integration into the Global Economy
 Five Core Elements (1st Pillar)
• Free flow of goods;
• Free flow of services;
• Free flow of investment;
• Freer flow of capital;
• Free flow of skilled labor
A S E A N E C O N O M I C C O M M U N I T Y ( A E C )
R E G I O N A L E C O N O M I C I N T E G R A T I O N B Y 2 0 1 5

10. © MERCER 2015 9
3 K E Y B E N E F I T S O F F R E E F L O W O F L A B O R
• For migrants: better wages and skills and
more protection
• For hosting countries: filling talent gaps and
boosting productivity
• For sending countries: money sent back
into the economy (remittance)

11. © MERCER 2015 10
TEST YOUR
AEC
KNOWLEDGE

12. © MERCER 2015 11
F R E E F L O W O F L A B O R : I S I T R E A L L Y
S O M E T H I N G N E W ?
7 million

13. © MERCER 2015 12
W H A T I S S T O P P I N G F R E E F L O W O F L A B O R ?
• Mutual recognition agreements (MRA)
• Visas and employment passes
• Qualifications and certifications
• Portability of social security
• Limited categories of labor
• General sentiment - “too many” migrants

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W H I C H C A T E G O R I E S O F S K I L L E D L A B O R A R E
C O V E R E D S O F A R ?
1. Engineering services
2. Nursing services
3. Architectural services
4. Surveying qualifications
5. Medical practitioners
6. Dental practitioners
7. Accountancy services
8. Tourism professionals

15. © MERCER 2015 14
W H I C H C O U N T R I E S S E E M O S T M O V E M E N T –
B E I T S K I L L E D O R U N S K I L L E D ?
SENDING COUNTRIES
1. MYANMAR
2. INDONESIA
3. MALAYSIA
RECEIVING COUNTRIES
1. THAILAND
2. SINGAPORE
3. MALAYSIA

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© MERCER 2015 15
SETTING THE CONTEXT
TALENT LANDSCAPE

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A T T R I T I O N R A T E S
T H E H I G H R A T E S A R E H E R E T O S T A Y
14.20%
13.00%
8.80%
14.00%
6.00%
10.20%
16.70%
10.70%
12.40%
16.40%
10.50%
13.00%13.60%
13.10%
8.80%
12.60%
6.50%
9.10%
17.10%
12.60%
12.70%
17.60%
9.70%
12.00%
18.60%
13.10%
10.10%
15.00%
6.20%
7.80%
17.60%
15.10%
13.70%
17.60%
11.90%
13.20%
CN HK ID IN JP KR MY PH SG TH TW VN
Voluntary attrition percentage (Average)
2012 (Full Year) 2013 ( Full Year) 2014 (Full Year)
Source: Mercer Asia Pacific Monitor Bulletin 2015 Q1

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V O L U N T A R Y T U R N O V E R B Y G E N E R A T I O N
R E Q U I R E S A C H A N G E I N E M P L O Y M E N T T H I N K I N G ?
4.8
2.7
6.4
13.7
4.6
3.0
10.9
4.1
3.3
9.1
4.1
2.9
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
MILLENIALS GENERATION X BABY BOOMERS
VOLUNTARYTURNOVER(%)
G E N E R AT I O N S
Europe Latin America Asia US
Source: Mercer’s 2015 Turnover Survey

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YOLO!

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M O D E R N W O R K F O R C E I N A N U T S H E L L
LOL
TL; DR / TL;NR
IDRC
kthxbye
Like a boss
FTW
IDK
JTLYK
IAWTC
19

21. © MERCER 2015 20
• The product of “helicopter parents” who provided unprecedented material, emotional and
logistical support for their children.
 The Snowflake Generation: Each one unique. Every one special.
• Gen Y expect:
 Frequent (positive) feedback
 Regular recognition and advancement with low hurdles: “Where’s my 9th place trophy?”
 Unconditional positive regard
• Gen Y value:
 Social aspects of work: Building relationships with colleagues and supervisors
 Formal networking programs for people with common interests
 Colleagues who keep them connected and involved (Gen Y often feel disconnected from
career opportunities, politics, and information flows in their organization)
 Genuine mentoring
 Opportunities to engage in pro bono work (i.e., organizations who give the opportunities to
contribute skills to nonprofit organizations)
• Gen Y require:
 Structure
 Flexibility
 Attention
C O M P A N I E S N E E D T O D E A L W I T H T H E G E N Y
V A L U E S Y S T E M

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© MERCER 2015 21
INNOVATIVE TOTAL
REWARDS
TO ATTRACT AND RETAIN
YOUR TALENT

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H O W A R E E M P L O Y E R S R E S P O N D I N G T O T A L E N T
C H A L L E N G E S ?
F O L L O W I N G T H E H E R D W I L L N O T W O R K
• Lot of focus on what is the same (benchmarking)……..
• Need to focus on what is different
– All employers provide the basics
• Decide on your differentiators
– Are they really different?
– Emphasis on them in all communication
• Think of the total employment experience
– Vision
– Leadership
– Rewards
– Career
– Development
– Work environment

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 Emotional connection
compliments the contractual
deal.
 The greater the emotional
connection, the less
dependence on contractual
components.
23
COMPENSATION BENEFITS
CAREER
WORK
PLACE /
LIFESTYLE
AFFINITY/
PRIDE /
PURPOSE
CULTURAL ALIGNMENT
COMPETITIVE
DIFFERENTIATED
UNIQUE
CONTRACTUAL
EMOTIONAL
+
M E R C E R ’ S E M E R G E N T T H I N K I N G
A D D I N G T H E “ X - F A C T O R ”

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24
COMPENSATION BENEFITS
CAREER
WORK
PLACE /
LIFESTYLE
AFFINITY/
PRIDE /
PURPOSE
CULTURAL ALIGNMENT
39 career insights, of
which 5 are truly
innovative
46 compensation
insights, of which 8
are truly innovative
19 affinity / pride /
purpose insights, of
which 10 are truly
innovative
84 workplace / lifestyle
insights, of which 17 are
truly innovative
19 benefits
insights, of
which 6 are truly
innovative
M E R C E R ’ S E M E R G E N T T H I N K I N G
E X T E N S I V E R E S E A R C H R E S U L T I N G I N M O R E T H A N
2 0 0 I N S I G H T S A C R O S S T H E D I M E N S I O N S O F
M E R C E R ’ S E M P L O Y E E V A L U E P R O P O S I T I O N ( E V P )

26. © MERCER 2015 25
Reducing the number of grades to 5 to 7 bands, in order to
manage individual compensation with wider pay ranges to
reward exceptional employee performance and skill
acquisition.
Rewarding exceptional one-off task or project
contribution, through a one-off exceptional award. For
combined achievement, exceptional reward may also
apply to a team. This practice is a derivate of spot
awards; the only difference is regarding the award
amount. Significant amount are intended to drive higher
satisfaction towards the award and to drive superior
performance behaviors.
Similarly to spot awards, exceptional rewards may be
established before or after the event.
Offering once a year the opportunity for
people to quit with a sum of money, in
order for them to reflect on what is their
aspiration in life. Encouraging a “healthy”
flow of talent through the organization to
enable career progression of emerging
talent
Giving every employee a monthly
allowance to award as a bonus to a
colleague. The bonus can be of a
monetary value (e.g. 50 SGD) or a
symbolic award that can be converted
afterwards in a gift or in a cash award.
True Broad banding
Exceptional Rewards
Pay-to-Quit
Co-Worker Award
Compensation
Innovations in employee compensation (1/2)
25

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For Executive levels, offering the options to choose own
pay mix, within defined guidelines. E.g. a high base would
be result in giving up a high variable pay upside.
Cash paid to an employee as an incentive to stay with the
company. Similarly to signing bonus, retention bonus
typically include a claw-back clause and are usually linked
to individual performance. The vested retention bonus is
vested over a defined number of years to drive short-to
mid-term retention, especially if the amount is
significant.
Performance-based cash granted to top
performers, to spend on a holiday for self
and relatives.
Internal regular lottery where
employees can earn up to a certain
amount (e.g. 500SGD). Employees don’t
need to purchase anything or do
anything to be the potential recipient of
the cash raffles, since this is a luck-
based.
Choose your own pay mix
Vested Retention Bonus
Exceptional holiday
bonus
Cash Raffles
Compensation
Innovations in employee compensation (2/2)
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28. © MERCER 2015 27
Granting 100% premium and claim coverage for medical
benefits.
Allocating flex point based on annual company profit.
Providing an e-commerce
approach to purchasing
employee benefits with or
without company subsidy
“Like the Amazon of employee
benefits”.
if an employee dies during the course of his
employment at the company, regardless of
the cause of death, the company pays
either a lump-sum or pension to the
surviving spouse, civil partner or family.
The lump-sum can be a one-off payment or
a payment spread over a period of time. It
can be a predetermined amount or a % of
the employee’s salary.
Cashless medical care
Profit-sharing based flexible
spending account
Benefit market
place
Death-in-service benefit
Benefits
Innovations in employee benefits
Developing strategy by holistically integrating
targeted and meaningful benefits rather than
offering a variety of programs with little
differentiation and no relevance to the
broader business objectives. Leveraging data
to measure and modify strategy on an
ongoing basis to ensure relevance to
changing workforce and business needs..
Holistic integration of
all benefits
Granting a lump-sum to new parents /
adopters. This often in addition to extra
leave days.
New Parent Benefit
27

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Online portal designed to help employees plan their career
within an organization by simulating potential career
moves.
The interactive application allows employees to view or
download job profiles, competency requirements and
development actions for each step of their chosen career
path. Employees can do a gap analysis that highlights
development areas they would need to address to achieve
their simulated career path.
Replacing traditional competency frameworks with
profiles that describe a career journey that an employee
can follow to one day reach that destination job, based
on the 70:20:10 development model.
Developing programs to ease on and off
ramping, in order to maintain a connection
with employees who decide to take time
off for various reasons
(childcare, eldercare, starting own
business, etc.)
These structured programs can include a
suite of solutions, such as
leaves, counselling, flexible work
arrangements, etc. Also known as return to
work programs.
Career explorer
Experiential profiles for
destination jobs
On-and-off ramping
programs
Career
Innovations in career management
Pairing-up engineers to work
together on a situation with a single
screen for them to learn form each
other.
Pair programming
Setting-up a framework for establishing a
peer-network. Usually, individuals are
offered to choose their peers, within the
same level; freedom is given in the pace
of peer-meetings.
Buddying / Peer coaching
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30. © MERCER 2015 29
Stopping Blackberry servers sending emails to some or all
employees when they are off-shift, in order to improve
work-life balance. This can also be apply during public
holidays and/or office closure.
Office design that takes employee out of the office.
Examples include atrium gardens, coffee bars, climbing
wall, ping-pong meeting room, giant slide, nap room, yoga
studio, tree-house, putting green, giant swing, basketball
hoop, skate park, secret room, relaxation room, DJ
booth, KTV room, hammock, library etc.
Providing a fixed amount of allowance for
employees to equip and/or decorate
their own work space.
Allowing employees to take as many
paid days-off as they want.
No Blackberry after office hours
Exceptional office design
Design your own
workspace
Unlimited holidays
Workplace / Lifestyle
Innovations in workplace / lifestyle (1/3)
Providing help in finding resources for almost anything
employees may be interested in, such as personal
shopping, laundry, dry cleaning, dinner or travel
reservation, theater tickets, arranging for pet care or child
care etc. Concierge services can be either
paying, discounted or free and are usually arranged by a
concierge service provider.
Concierge services
29

31. © MERCER 2015 30
Granting all employees a credit card to spend on
reasonable job-related spending (e.g. buying a book or a
software, going to a conference, etc.).
Offer running tabs at a coffee shop or a
F&B outlet
Providing free electric car to be rented for several hours a
day to run errands.
Discretionary credit card
Running tabs
Free rental cars
Workplace / Lifestyle
Innovations in workplace / lifestyle (2/3) On-site free-flow of drinks
at a determined time of the
day, either weekly or for a
special occasion. Variant:
on-site pub.
On-site happy
hours
Granting
unlimited paid
time-off for
employees
suffering from
illness or non-
occupational
injury.
Unlimited sick
leave
Alternate work arrangement to reduce the
number of days work by extending working
hours. With this arrangement, employees still
have to make-up the full number of hours per
week. E.g. 4 days working 10 hours or 3 days
working 12 hours.
Compressed work week
30

32. © MERCER 2015 31
Granting extra leave to assist with grand-parents or grand-
child.
Granting time off, either paid or unpaid, provided to
employees (male or female) to care for their own serious
medical condition or a seriously ill family member, new
baby or adopted child.
Encouraging
employees to plant /
pick their own
vegetables in a
greenhouse during
break times
Providing means of transportation for
geographically extended site. E.g.
bikes, rollers, skates, Segway, etc.
Grand-parent & Eldercare leave
Family care / compassionate
leave
Community gardening
On-site mean of
transportation
Workplace / Lifestyle
Innovations in workplace / lifestyle (3/3)
Giving all employees a lump-sum of money to travel
anywhere in the world, every year.
Annual Travel Credit
Providing a fixed amount of allowance per year to make
eco-home improvements — like solar installations or
energy-efficient windows — that will reduce waste and
the use of fossil fuels and increase the use of renewable
energies.
Eco-home improvement
31

33. © MERCER 2015 32
Encouraging employee support of not-for-profit organizations.
The company matches employee gifts to qualified
educational, civic, cultural, health and youth organizations with
one dollar for every dollar the employee contributes, up to a
certain limit per year.
Providing non-cash rewards to employee, to reinforce the
emotional impact of rewards . Critical to reward’s impact
are timeliness, personalization alignment with the
employer brand and giving the choice to employees to
choose their ‘life-enriching’ reward. e.g. gift voucher, an
“experience” (such as i-fly free fall simulation or a dining
experience in a Michelin starred restaurant), a holiday, a
ticket to an event, a ‘pampering experience, etc.).
Encouraging employees to contribute to
the community by paying their time spent
volunteering.
Inviting industry leaders to share
experience and wisdom, in order to
teach and inspire employees.
Matching gift
Experiential rewards
Support paid
volunteer time
Influential speaker talk
Affinity, Pride, Purpose
Innovations in generating positive employee emotions (1/2)
Giving employees a weekly run-down of
what happened during the
week, followed by a questions and
answers session.
Talk-to-the-boss
32

34. © MERCER 2015 33
Competing for local awards to demonstrate company full
commitment to realize company value proposition. E.g.
employer of choice, environment protection
awards, sustainable business industry recognition.
Inviting employees to bring their kids/relatives to work, in
order for them to understand the work that the parent
does and to think about their future career. It is also a
way to engage with co-workers and to build company
pride. The day can include fun activities (e.g. scavenger
hunt) and/or work related activities (e.g. housekeeping).
Encouraging peer-recognition: co-
workers to share an exceptional moment
or ah-ah moment created, through a
short story write-up. Featured story
author to receive a lump-sum as
recognition.
Industry awards / accolade
Bring your kids to work day /
family day
Fellow co-worker
recognition
Affinity, Pride, Purpose
Innovations in generating positive employee emotions (2/2)
Spare time to work on a personal project, related to work
discipline.
Thinking time
Giving each employee an hour and a half per week to
manage their personal errands.
Personal time
33
Customized EVP proposition for key talent
- employees’ wish-list regarding
pay, careers, work-life; to be discussed
with managers to agree action plans
Individual Value Proposition

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© MERCER 2015 34
LOOKING AHEAD
WORKING IN 2020

36. © MERCER 2015 35
L O O K I N G I N T O T H E F U T U R E
T R E N D # 1
From one size fits all
to segmentation…
to personalization

37. © MERCER 2015 36
L O O K I N G I N T O T H E F U T U R E
T R E N D # 2
Increased focus on
communication and social
media

38. © MERCER 2015 37
L O O K I N G I N T O T H E F U T U R E
T R E N D # 3
Use of more sophisticated
workforce analytics and
planning tools

39. © MERCER 2015 38
L O O K I N G I N T O T H E F U T U R E
B Y 2 0 2 0 … .
• Total Rewards will be customized for each
employee
• The workforce will have more contingent
workers
• The workforce will consist of even more
different generations and cultures
• Increased workplace flexibility will be the norm

40. © MERCER 2015 39

41. © MERCER 2015 40
A B O U T T H E P R E S E N T E R
G O D E L I E V E V A N D O O R E N
• Godelieve van Dooren is the Information Solutions Business Leader for
ASEAN and is in charge of the strategic positioning of Mercer’s information
services in 8 countries across ASEAN.
• Prior to taking up this position in 2013, she was Mercer’s Asia Pacific
Benefits Product manager and was responsible for Mercer’s benefits
surveys and related benefits product.
• Godelieve is also involved in several industry forums consisting of leading
MNCs, including Mercer's Hi-Tech and Mercer's Consumer Goods forum.
• Before joining Mercer in 2007, Godelieve worked as a senior human
resources consultant with Ernst & Young in the Netherlands, specializing in
benefits design and consulting. She has led many projects for multinational
companies on HR issues concerning human resource
strategies, performance management and development of reward schemes
focusing on (flexible) benefits plans.
• Godelieve holds a MA in Law from the University of Utrecht, The
Netherlands.

42. © MERCER 2015 41