Katie Archer has taken to heart the time-honored saying: When it comes to investing, saving and planning for retirement, one size doesn't fit all.
As director of global benefits for Alexion Pharmaceuticals Inc., New Haven, Conn., Ms. Archer has presided over a retirement readiness review that incorporates country-specific information for employees to assess if the defined contribution plan designs enable them to save enough for retirement and if they are saving enough. Ms. Archer chose this path because she found general averages insufficient to take into consideration unique needs of participants. "We need to stop relying on benchmarks," she said. "Let's see what is meaningful."
Alexion has incorporated information such as retirement income as a percentage of participants' pre-retirement earnings, an expected retired age, the average life expectancy, average cost-of-living data and an assumed outside savings rate. The company employs people in more than 20 countries, she said.
Alexion officials analyzed plan demographics and investment patterns among participants as well as which participants weren't saving enough. Alexion built the analytic system in-house, while Mercer, the plan's investment consultant, manages it.
Ms. Archer said it took about 12 months to create the system, starting in the fall of 2014 and getting the OK from top management in the fourth quarter of 2015.
Her achievement garnered high praise from judges, who said she deserved an Innovation Award.
"We hear a lot about retirement readiness, but this plan sponsor provided a very well-thought-out and comprehensive means to define it for their company," one judge wrote. "They show that they are committed to having their employees ready through the defined contribution plan design."
Another judge cited the multifaceted approach to problem-solving, marveling at Alexion's "ingenuity in coming up with their own models and metrics." Alexion's effort, the judge added, "is impressive and reflects an innovator's spirit."
Ms. Archer said the rollout is deliberate in part because Alexion employees in different countries are covered by different types of DC plans and by different regulations.Alexion has implemented its program for DC plans in the U.S. and Canada, and it is in the process of finalizing programs for four other countries."
Alexion's goal is to pick four to five countries per year, depending on the number of Alexion employees and the regulatory climate of the various countries, Ms. Archer said.
Alexion also will review its country-by-country programs every two to three years to determine if changes should be made.