Relocate winter 2014-2015 by Profile Locations

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Re:locate Winter 2014/15

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Dynamic Britain Making it happen in 2015

Middle East Relocation alive and well

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SECTION HEADING

Contents 10 38

6 NEWS, ANALYSIS & EVENTS 4 Re:editor’s letter

FEATURES 22 Re:Ireland

26 Re:awards

48 Re:conferences

Fiona Murchie looks at what’s in store this issue.

Staking its claim to be Europe’s Silicon Valley?

Your chance to enter the 2014/15 Re:locate Awards.

Exploring the overarching themes for global business.

51 Re:events

Innovations to support those working across global mobility.

52 Re:news & analysis

54 Re:supporting VIPs

The first of a new series considering how to support high-flyers on the move.

Key happenings, personalities and comment.

HOT TOPIC 6 Re:enterprise

An injection of government money, new infrastructure and a brand new community are driving Ashford’s growth as a global centre.

GLOBAL MANAGEMENT 10 Re:industry focus

Is the phenomenal growth of the UK’s aerospace sector threatened by skills shortages and lack of succession planning?

28 Re:Middle East

Analysis of the region’s oil and gas sector, the position of women in business, and relocation issues, plus tips on choosing a school.

38 Re:pensions

Looking at the major changes and challenges ahead, and unlocking the retention power of the end-of-service gratuity.

44 Re:Latin America Key insights into business and mobility from

POLICY & PRACTICE 14 Re:outsourcing

Employers and outsourced suppliers are raising their game in the face of cost focus and greater competitiveness.

16 Re:compensation

Issues in expatriate reward, highlighted at the Expatriate Management and Global Mobility Forum.

EMPLOYEE SUPPORT 20 Re:banking

Giving senior executive relocating to the UK the support they need to manage their finances.

57 Re:property

What does 2015 hold in store for relocating employees looking to buy a home in the UK? Plus the latest on the serviced apartments scene.

60 Re:education

Innovations emerging from the global network of international schools.

Worldwide ERC’s Latam conference.

2 | Re:locate | Winter 2014/15

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The Team Design: Cohesion Marketing by Design Editor: Louise Whitson

exciting year in 2015!

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Address Re:locate Magazine Spray Hill Hastings Road Lamberhurst Kent TN3 8JB T: +44 (0)1892 891334 F: +44 (0)1892 891336

Our welcoming committee for your international assignees and their families

“ourJoinmediaus across for an

Managing Editor: Fiona Murchie editorial@relocatemagazine.com

It’s nice to know they’ve got a friend

”

s we launch at high speed into 2015, it is clear that the UK economy is picking up. The autumn conference season, from Worldwide ERC in Brazil and Chicago to the CIPD in Manchester and the CBI in London, has highlighted that business conditions are still tough, but that companies are on the move and responding to global competition.

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Exports are growing, and companies want to know more about how to get into new markets and manage global teams. Common themes reflect the desire to know how to engage staff, increase productivity, retain talent, and respond to competition from emerging markets.

As an international family moving to the UK, it’s nice to know that they will be supported in not just their banking requirements, but also in settling their family into the UK. Our personal service to help them through the account opening process and new NatWest Global Employee Banking website means they’ve always got a friend ready to lend a helping hand! Helpful guides on everything from banking in the UK and education for their children to family days out plus our superb online and mobile banking. We’re here to make sure their move is as smooth as possible.

natwestglobal.com

+44 (0)1245 355628

The recent knife-edge independence referendum in Scotland widened the debate around devolved powers and the ramifications for business on both sides of the border. This has inevitably impacted on the UK’s position in Europe, and, as we approach a general election in May, has led to a heightening of awareness around immigration, tax, and the EU economies. The features in this issue reflect response to growth opportunities, from Ashford, in Kent, to Ireland, the Middle East and Latin America. Enterprise has never been more important. In this issue, we chart stories of success that will inspire you to enter the Re:locate Awards 2014/15. Join us across our media for an exciting year – in print, online and via our new Editor’s Breakfasts and webinars.

Fiona Murchie Managing Editor

International Networking Evening Wednesday 11 Feb 2015, London Details from events@relocatemagazine.com

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Entry deadline Friday 13 March 2015

© 2014. Re:locate is published by Profile Locations, Spray Hill, Hastings Road, Lamberhurst, Kent TN3 8JB. All rights reserved. This publication (or any part thereof) may not be reproduced in any form without the prior written permission of Profile Locations. Profile Locations accepts no liability for the accuracy of the contents or any opinions expressed herein. ISSN 1743-9566.

Coming in the Spring 2015 issue of Re:locate magazine

10th ersary Anniv Year

OIL & GAS

AFRICA

DIVERSITY

Special industry focus

The ins and outs of doing business

A winning formula for global growth

National Westminster Bank Plc. Registered in England No. 929027. 135 Bishopsgate, London, EC2M 3UR. National Westminster Bank Plc. is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Calls may be recorded.

HOT TOPIC

Photograph by Martin Leusby

Photographs by Ashford Borough Council

HIGH-SPEED ASHFORD

Making European connections As the high-speed railway celebrates its fifth anniversary, and with HS2 and HS3 in the headlines, Fiona Murchie shares some of the surprising initiatives that are driving Ashford’s growth as an international centre. An injection of government money, new infrastructure and a brand new community are just some of the developments that are making other regions sit up and take notice.

6 | Re:locate | Winter 2014/15

n December, the HS1 fast train service linking Kent to St Pancras celebrates its fifth anniversary. The fact that Ashford is an international rail hub and has the fifth-busiest railway station in the country, with 3.3 million passengers passing through every year, has probably escaped the notice of most business decision-makers. Its high-speed rail connections to France and Europe are obviously hugely significant, but Ashford has also reaped the economic benefits of the HS1 service to St Pancras having cut the journey time to central London by more than half, to just 38 minutes. Paris is under two hours away. Revelations of Ashford’s growth successes are timely and of significance to organisations contemplating their own global growth at a time when the debate surrounding the route and cost of HS2, and the recently announced HS3, are in the news almost weekly. With the May 2015 general election looming, infrastructure and HS2 and HS3 and their impact on the UK economy and business growth around the regions will continue in the headlines. There could be a lot to be learnt from the Ashford story in many dimensions. Connectivity and infrastructure inevitably impact on organisations and mobility. New rail and road routes and airport expansions can open up areas to growth and economic stimulus, but equally they can be seen as blighting a relocation hotspot. What companies want in terms of fast communications, quality commercial space at affordable prices, and access to workforce may not stack up with the lifestyle requirements of mobile talent being asked to move to the area or those of the incumbent workforce. Nimbyism often prevails over economic reality.

Adapting to changing times In the early days of relocation in the UK, back in the late 1980s and 1990s, the relocation picture was dominated by

the regional development agencies (RDA) and their bid to attract inward investment from overseas (largely the US and Asia/Japan) or other parts of the UK. There was a strong emphasis on development and construction, with regions competing against each other to attract companies. But the world has moved on since then. The recession hit builders and developers hard, the RDAs were disbanded, and local government has experienced huge spending cuts, as well as being caught at the sharp end of global financial and pension investment collapse in countries like Iceland. So when a local authority is trumpeting international success with a fresh approach that has attracted the attention of the Treasury, and has a plan for growth that puts people, ethical values and sustainability at the heart of its resurgence, with attention to demographics, education and jobs, it is worth closer investigation as an emerging relocation hotspot with international ambitions. I was warned that the leader of Ashford Borough Council was probably not what one would expect. Gerry Clarkson was formerly the chief fire officer of London. After stepping down, he raised huge amounts of money for the Firefighters Memorial Trust before starting his own fire engineering consultancy and then moving to Kent. Mr Clarkson certainly has an abundance of drive, ambition and the motivation to lead Ashford to an international future – which has been a long time coming – as the gateway to Europe. He is a charismatic figure who is determined to put Ashford on the map, to get recognition for what it has already achieved, and to promote its economic model. The Ashford Model is about helping Ashford to achieve a sustainable community that is forward-thinking and fit for an international role within environmental and social boundaries to improve society and promote growth. Some of the measures already in place are testament to this vision, but anyone stepping off the high-speed train at Ashford

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HOT TOPIC

Chilmington Green

International will see that there is a way to go yet. However, this is about the journey, and telling the story boldly will help Ashford to gain the momentum it needs to achieve success as a European and international player. Councillor Clarkson sees Ashford as punching above its weight in the bid for developer and investment interest to secure its future as a leading inward investment location competing with places such as Manchester, Leeds, Cardiff and the City of London. Speaking at the MIPIM UK commercial property event held in London at the end of October, he said, “With Ashford’s growing reputation as an international town, we have a great story to tell, demonstrated by a host of big company names who have already enjoyed success here, which formed part of our ‘storytellers’ campaign. Such companies include Premier Foods and Brakes. “The message from us was clear: Ashford is going places, and now is the time to get involved.”

Government support and infrastructure Ashford is buzzing with news of major investment initiatives. The government has given the go-ahead to fund J10a of the M20, which will speed up economic development south of the town, while a planning application for a large industrial park at Sevington is in progress. Gerry Clarkson and his team appear to have brought clarity, vision and focus to their ambitions for Ashford, and their strategy, encapsulated by the Ashford Plan, has already caught the attention of the government and George Osborne, Chancellor of the Exchequer. Councillor Clarkson has presented Ashford’s blueprint for integrated growth to senior Treasury officials, and further talks are planned, which suggests that there is something fresh and

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compelling about Ashford’s joined-up economic vision that can be rolled out as a successful formula for other regions throughout the UK.

Jobs and employment

Housing and quality of life

• 84,000 square metres of employment floorspace created between 2009 and 2012

Owner McArthurGlen has launched plans for the expansion of Ashford Designer Outlet, while proposals for the town’s Commercial Quarter are well advanced, and a new residential community featuring 5,750 homes has received outline planning consent. The £1.5 billion development at Chilmington Green, in a prime location to the south west of Ashford town centre, is expected to create 1,000 jobs within the next 20 years. Exceptional quality will be at the heart of the project, Gerry Clarkson insists, citing Ashford’s demands for more space and gardens to ensure the scheme becomes a benchmark for future residential developments. Chilmington Green, which will be divided into three neighbourhoods, will reflect many of the design principles of a successful garden city, including tree-lined streets, a spacious layout, high-quality public spaces, and a strong local community managing an impressive range of local facilities. Councillor David Robey, Ashford Borough Council’s portfolio holder for development, said, “Increasingly, we hear about developments adopting garden-city ideas, but Chilmington Green goes much further. The innovative Quality Charter we have signed with the developers of the site, and the radical proposals for community management of many millions of pounds of assets in the area, makes this a very special project indeed and, we hope, a model for the future. “By creating a place designed with quality in mind and a community empowered to manage and look after it, we can leave a lasting legacy that everyone can be proud of in years to come.” Ashford already has a number of new housing estates, and has continued to build new homes at an average of 615 per year over the last 12 years, including the recession period. There are renovation projects converting town-centre office property into luxury apartments which are flying off the plans. Some are for serviced apartment use, which indicates there is serious interest in Ashford’s potential as an international business centre. There is a second-phase development in the pipeline.

• More than 500,000 employees live within a 40-minute drive • 7,500 new jobs created in the last ten years • Low unemployment rate

• Most apprentices in Kent – 2,500 in last two years • Ashford’s Council Tax lowest in Kent International companies based in the borough include beauty products manufacturer Coty, Givaudan, and Hitachi, which supports the international rail system. French gaming portal Eclypsia has recently been attracted to Ashford by high-speed communications with Europe, the support of local politicians, and high-speed internet. It now employs 100 people.

Eldercare Aware of ageing demographics, Ashford has already attracted Bupa to develop a pioneering residential home in the town which is conducting valuable research, with potential for more badly needed scientific and medical research investment by other organisations. There is also a purpose-built housing development with later-life needs catered for, so that residents don’t have to move house.

Attracting tourists Ashford is widening the net and looking to attract more continental visitors. Kent already welcomes French, Dutch and Belgium tourists who are keen to visit the lovely countryside of the Garden of England, the historic towns and villages so loved by antique collectors, and the famous gardens, castles and historic houses of the county. The nearby cathedral city of Canterbury is a major tourist centre and an attraction for anyone moving to the area. Planned developments that will also capitalise on the tourist economy are a model railway venture supported by celebrities, which capitalises on the rail links with the town and the passion for the hobby in France. A recent revelation that Ashford has the only unpolluted skies in the South Eastern Coastal Region has set in motion ideas for a telescope project that could benefit local children and bring astronomical and scientific research to the area.

ASHFORD’S ‘BIG EIGHT’ SCHEMES Seen as pivotal to the international success of Ashford and its economic growth are: T he Commercial Quarter, a new office campus adjoining Ashford International Station with the potential to deliver up to 55,000 square metres of office space, 150 homes and several thousand jobs E lwick Place, a town-centre cinema with places to eat and drink around a new square and meeting place for the town centre esigner Outlet D expansion. More than three million people a year already visit the McArthurGlen Designer Outlet Ashford International College campus, a new skills campus for post-16 education 20 Junction 10a, providing new motorway M junction capacity to support expansion and improvements Jasmin Vardimon International Dance Academy, to develop the company’s existing offer in Ashford and create a flagship centre of creative excellence shford International Station ‘spurs’, allowing A access for new international trains to stop at Ashford hilmington Green, a new community with C 5,750 houses, extensive business, retail and restaurant capacity, schools, open spaces and community areas, expected to create 1,000 jobs within the next 20 years. Outline planning application approved November 2014

For news and articles on enterprise and the economy, visit relocatemagazine.com/enterprise

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he UK’s aerospace sector is a huge player on the global stage, second in size only to that of the US. Furthermore, it’s growing at a phenomenal speed. Forecasts suggest it will expand at a rate of 6.8 per cent over the next few years, with plenty of opportunity for overseas investment. As with other engineering sectors, however, it faces personnel challenges. Around 3,000 aerospace companies are currently operating in the UK. Big British names include BAE Systems, GKN and Rolls Royce. Many of the major international companies in the industry, including Airbus, Cobham, AgustaWestland, Finmeccanica, Thales, Boeing and Bombardier, maintain a presence. While the large companies make up a significant portion of the sector, the UK aerospace industry also has the strongest SME component in Europe, accounting for 55 per cent of total civil aerospace sales in 2010. The sector employs around 230,000 people. Of those, 100,000 or so are directly employed by the industry, while a further 130,000 work in supporting roles. Research and development makes up some 21,100 of those positions, and around 3,000 apprentices are in the industry, according to ADS, the aerospace trade body. A characteristic of the industry is its multifaceted workforce, and the skillsets that make it up cut across a broad swathe of disciplines, including engineering, science, production, service, project management, training and finance. Particular strengths of the British industry include the design and manufacture of large aircraft wings, production of engines, and building of landing gear systems. Britain is also one of a handful of countries able to design and build advanced helicopters. Demand for new commercial craft is expected to be to the tune of 40,000 ($165 billion) every year. The UK also has a significant maintenance, repair and overhaul (MRO) sector, across both civilian and military aircraft. UK Trade & Investment (UKTI) says Britain accounts for a 17 per cent share of the $45 billion global MRO industry.

UK AEROSPACE SECTOR THE SKY’S THE LIMIT?

The UK’s booming aerospace industry, which accounted for 55 per cent of civil aerospace sales in 2010, has been described by the government as a phenomenal success story and a sector that offers tremendous opportunities for growth. But is that growth being threatened by skills shortages and lack of succession planning as older workers retire? Mark E Johnson investigates.

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Image courtesy of BAE

Boom times The industry is, by all accounts, booming at the moment. In a recent report, the UK government characterised it as a “phenomenal success story” and a sector that offers “tremendous opportunities for growth”. In June, ADS published its Aerospace Industry Outlook Report, which shows that the aerospace sector has grown at ten times the rate of the rest of the UK economy. Since 2011, it has expanded by an impressive 14 per cent. That growth appears unlikely to slow. Figures from the ADS report show that 68 per cent of UK aerospace companies expect more than 10 per cent growth over the coming 12 months, while three out of four companies in the sector say they will increase investment over the next 12 months, and one in four is reshoring activity. Government investment and support have helped drive

Image courtesy of BAE

INDUSTRY FOCUS

growth. The government is working with industry through the Aerospace Growth Partnership and on the aerospace industrial strategy. Ian Millard, aerospace business unit manager for Collingwood Executive Recruitment, told Re:locate that British manufacturing in general was doing well, and that this had played a part. “We’re still a very, very strong country for engineering, and British products are respected the world over.” Highlighting trends that were helping drive growth, Mr Millard said, “The key growth area within aerospace manufacturing at the moment is anything that makes the plane lighter, makes it use less fuel. Those are the key things which are driving the industry. The cost savings from having lighter aircraft are pretty astronomical. The new generation of aircraft don’t actually look any different to the untrained eye. But an aircraft will cost an airline £100 million, for example, for an A320. They’re flying that constantly, but if they’re using less fuel, that quickly pays for itself.” That can be any part of the plane, right down to lighter seating or wi-fi-based in-flight entertainment that cuts out unnecessary wiring. These exercises in weight reduction are being driven by a combination of climbing fuel prices, the availability of new technologies, and customer demand for a better experience. “In aerospace in general, innovation is being driven by weight saving and those incremental gains, rather than designing the next generation of Concorde. That’s happening at a very academic level, but at a business level it’s not that blue-sky thinking any more,” said Ian Millard. He did add, however, “I’d say the French, Germans and US are probably ahead of us in terms of innovating the real techy stuff. We’re more airframe and bashing the metal together.” One upshot of the drive towards lighter aircraft is a need for skills in a handful of key areas. One is additive manufacturing, or 3D printing, which enables the production of parts quickly, cheaply and in small batches. UKTI notes a 12 per cent growth in additive manufacturing over the last year. Composite materials are also a key area, with 9 per cent growth expected in the next year. Another area that will need its staffing requirements met in the future is plastic electronics – electronic devices on flexible

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INDUSTRY FOCUS

Image courtesy of BAE

surfaces. It’s a field that currently employs 3,000 people, but UKTI expects that figure to balloon to 50,000 by 2027.

Bridging the skills gap Drilling down, employers say there’s a need for design optimisation, CAD skills and finishing skills, as well as understanding of the new technologies coming into play. Particular jobs highlighted by UKTI include R&D engineers, material engineers, project managers and quality assurers. On the military side, Richard Hamer, head of education and early careers for BAE Systems, which counts submarine building among its activities, said, “As in previous years, we believe there is a UK shortage of naval architects and systems engineers. People with these skills are very sought after, and we have to work hard to compete with other companies to offer a good package and career opportunities.” Mr Hamer also noted the need for skills relating to additive manufacturing, composites and plastic electronics, but said that it had not affected BAE Systems’ business. The real issues with skills shortages are likely to come further down the line. As with many engineering fields, aerospace has an ageing workforce. “The skills shortage will come in the next ten years,” Ian Millard said. “The growth of UK aerospace is massive, but about 50 per cent of our current workforce will retire in the next ten to 15 years, so there’s a huge gap in the middle. “The industry is starting to attract people again – highcalibre graduates, engineering graduates, technical people – at the bottom. But then there are people leaving the industry at the top, and the middle is facing a shortage. And that’s not unique to aerospace. We find that in rail, in automotive, and in manufacturing in general, where, because ten or 20 years ago the apprenticeship scheme went out of the window, there is a gap between experience and technical knowledge.” Mr Millard noted that there was now a much greater number of high-quality engineering graduates than was the case five to ten years ago. That’s not an unconditional positive,

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however. “From a general engineering point of view, what people tell me is that they have a hard time attracting talent from the universities because there are ‘sexier’ industries out there, such as automotive or consumer electronics, where things happen a lot quicker. “Aerospace is a slow burn in terms of designing a product. It might be two or three years before that product is on a plane, because it has to go through all the testing, all the certification. And then you might have to wait for a ten-year life cycle to end on your customer’s existing product.” In other industries, he added, the fruits of engineers’ labour might be visible in weeks. “If you work for Apple or Google, you see things on a daily basis.”

Laying the groundwork What that means, of course, is that there are opportunities ahead for recruiters. “It’s a growth industry in recruitment,” said Ian Millard. “I think there will be more and more growth opportunities for recruitment within the sector as time goes by and people start planning for those retirements, and there will be succession planning for future recruitment campaigns and future roles.” There’s plenty for the UK aerospace sector to look forward to, but if it wants to have the resources it needs when opportunities arise, it needs to lay the groundwork now. In the Spring 2015 issue of Re:locate magazine, we’ll be looking at how HR in a range of sectors, including aerospace and oil and gas, deal with skills shortages and build a talent pipeline through such means as relationships with leading universities.

Contact us to discuss your requirements Quote: Re:locate Magazine +44 (0) 207 749 4460 OakwoodUK@Oakwood.com OakwoodWorldwide.com

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OUTSOURCING

POWERING GLOBAL MOBILITY AT NATIONAL GRID AN OUTSOURCED APPROACH Employers and outsourced suppliers are raising their game in the face of cost focus and greater competitiveness. Showcasing the benefits of a partnership approach to service provision, Re:locate-award-winning IPM Global Mobility and its client National Grid spoke to Ruth Holmes about how process outsourcing supports the vital ‘soft’ side of assignment management.

ational Grid, despite its moniker, is an international company based in the UK and north-eastern US. It is at the forefront of one of society’s greatest challenges, the creation and distribution of clean energy. Alongside working with stakeholders to develop and implement sustainable and affordable energy solutions, its main job is the safe running of the energy networks we rely on. National Grid’s expatriate programme has a population of around 25 assignees, ranging from senior executives and technical experts to graduate trainees at any one time. Most are assigned to the US, with around five in the UK from the US. A similar number, who monitor midstream supply and distribution on the European mainland and manage interconnectors, are based in Belgium, the Netherlands and Luxembourg. “We are a big company and have always offered international assignments,” says Sandra Buck, global expatriate manager for National Grid, describing the important role of the global mobility function at the energy provider. “We offer overseas opportunities to employees who have the right skillset and are able to develop these skills while living and working in another country. This includes people from quite junior roles and graduates right through to our very senior people.” Assignments are planned well in advance, involving HR, managers and individuals to ensure that the right people are selected. Many assignees are sourced through a robust talent process. In such a knowledge-intensive industry, the global expatriate programme adds value to the company through the smooth and legally compliant movement of specialists and the sharing of practice and expertise. From a corporate culture perspective, mobility also means that

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National Grid’s norms and culture can evolve throughout such exchanges, enhancing internal communication and ultimately performance.

Partnership frontier To service the needs of assignees in such critical roles, National Grid has retained a small and highly effective in-house expatriate team comprising Sandra Buck in the UK working alongside Victoria Geswaldo, the company’s US HR consultant, and Phillip Bond, National Grid’s UKbased in-house expatriate tax adviser. The team of three, reporting to the global head of reward, is fully supported in the administration of assignments by its outsourced provider, IPM Global Mobility, winner of Re:locate’s 2013/14 award for Relocation Service Provider of the Year. “I look after the assignment policy, the assignees, and the day-to-day management and running of our expatriate progamme in and out of the UK,” explains Sandra Buck. “HR colleagues come to me to initiate the move, and I then go to IPM to get the ball rolling, the assignment remuneration calculated, and assignment terms drawn up. “It’s at this point that IPM becomes part of our team. Although not directly part of National Grid, IPM undertakes the set-up of the assignment on our behalf. Its team is the point of contact for assignees as they make their move, and will discuss any problems or questions about the practicalities of the move.” As a global mobility practitioner looking after the needs of a diverse pool of assignees and their individual circumstances, Sandra Buck finds that the relationship with IPM works because she can access a wider pool of mobility expertise in one place than National Grid’s volumes would ordinarily warrant in house.

Through its specialised work and client volume, the IPM team is able to advise on the implications of legislative changes, the application of tax and social security rules, and market practice. IPM’s size compared with some consultancies is also a bonus for National Grid, which seeks a high-touch, approachable and expert service to reflect its in-house approach. National Grid first outsourced its expatriate administration in 2001, and IPM was its chosen provider. As part of National Grid procurement practices, tenders are held periodically, but IPM has retained its position following this competitive process. “The aim of the relationship is to provide a seamless, professional service to our expats, from the in-house team to the external providers,” says Sandra Buck. “I don’t, and can’t, know everything about everything, but IPM is a team of people who have that expertise. They always have an expert who can deal with the query in a professional way. That way, we can support our assignees as well as our colleagues across the business. “For example, IPM provided some excellent support around a potential major project. There was the potential for the expatriate population to increase quite dramatically. We needed to know quickly whether or not IPM, as part of our team, could handle the project. IPM helped us prepare the data. It’s about having that trust and confidence, built up through our relationship over the years and listening to each other, that we, as a team, can support the wider business.” The advantages of this type of relationship are underlined by a white paper published in September by global professional services provider Deloitte. It identified the key benefits of this approach as having at least a ‘somewhat positive’ or ‘significant’ impact on process efficiency (92 per cent), cost reduction (88 per cent) and internal control (87 per cent). These findings are echoed in findings from IPM Global Mobility’s own customer satisfaction surveys and National Grid’s experience.

Connecting people, places and processes Outlining how HR outsourcing is moving on from the simple process elements to the more value-adding process aspects, Scott Niven, director at IPM Global Mobility and part of the team working with National Grid, explains, “We are specialists in assignment management and focus on the end-to-end process, so we are not transactional. Where an HR generalist is responsible for managing an assignment, without the relevant experience and support and due to time constraints, it’s often very much a case of ‘get the assignment letter out’ and then a not very joined-up process afterwards. But we are different, in that we make sure the whole process is seamless, with all necessary actions taken and coordinated.” Analysing the particular circumstances and requirements of the assignment, and then drawing up and signing off an accurate assignment letter, is a critical part of the process.

Done well, it reduces anxiety, time spent ensuring tax, immigration and legal compliance, and the need to untangle policy interpretations and conflicting communication further down the line. Here Sandra Buck works with IPM to create a profile of the assignee and his or her circumstances. IPM can then begin the process of costing the assignment, undertaking remuneration calculations, organising visas, destination service provision, payroll set-up and ongoing monitoring. “Once the assignee has relocated, some may think that the file is closed, and they will not necessarily recognise that further things might need to happen. That’s when problems come to the fore,” says Scott Niven. “For IPM, once the process is initiated, we can offer a full service, from expatriation to repatriation. It’s as much about getting the assignee and their family members from A to B as it is about managing their needs thereafter. Circumstances often change, and certain things, such as visas and social security certificates, may need to be renewed during the assignment. We track the entire process. “I would say it’s not just visa tracking that IPM is good at, but also passport expiry tracking and when assignees’ salaries need to be reviewed,” adds Sandra Buck. “But the big one for us will always be the monthly payroll updates, annual salary review process, and our annual performance award, including the processing of share-based awards. IPM is very good at linking with our payroll and other processes, and makes it easy for us to link into theirs.”

Policy considerations IPM’s rigorous assignment administration is matched in house by National Grid’s formal expatriate policy and associated benefits. It operates a clearly worded policy which endeavours to reduce the scope for exceptions. “Supporting Sandra and National Grid, we are also guardians of the policy,” says Scott Niven. “We make sure that it is adhered to, but flexible enough when it needs to be. We offer a clear way of making exceptions if needed, but if the policy and process are good, that won’t be too often. But all exceptions need to be managed in the same way. We have that insight and current knowledge to advise HR or have the conversation with a global expatriate manager like Sandra.” As importantly, this joint approach between IPM and National Grid gives Sandra Buck and her team greater scope to concentrate on the softer, but vital, aspects of assignments – those that often have a significant impact on the success of a move and therefore wider business success. To enter the Re:locate Awards 2014/15, visit

relocatemagazine.com/awards-2014 Categories for HR and suppliers

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COMPENSATION

A 10th ersary Anniv Year

ASSIGNMENT COMPENSATION

Issues to consider in expatriate reward

At the Symposium Events Expatriate Management and Global Mobility Forum 2014, presentations from AIRINC, Mercer and Atkins highlighted issues to consider when delivering remuneration to international assignees. Dr Sue Shortland, who chaired the conference, draws upon these presentations to reflect on the issues to think through in the strategic choice of remuneration policy and practice.

s the range of destinations for international assignees expands and the locations from which talent is sourced also rise, the complexity of the home/host pairings between which international mobility takes place increases. Added to the mix is the assignment type used – long-term, short-term, commuter, rotation, global nomad, and so on. As business strives to compete, ensuring that your business wins the competition for international competencies is paramount. Set against this is the need to contain costs, minimise administrative processes and enable maximum flexibility in deployment of human resources. Given these parameters, the selection of a suitable remuneration system that will meet the basic need of being able to attract, retain and motivate assignees is, most certainly, a challenging task. Traditionally, as AIRINC noted, there has been a choice of two main expatriate remuneration systems: home- or host-based pay. Home-based payment systems preserve equity with home-country peers; host-based systems provide equity with locals while on assignment. A global system that delivers remuneration suited to internationally mobile personnel (who move from country to country and have no ‘home’ base as such) presents a third strategic choice suitable for global nomad senior managers. Under this approach, equity is maintained among and between expatriates, regardless of their home- and host-country location pairings.

The balance sheet Over the years, the home-country remuneration approach (known as the balance sheet or build-up) has been the frontrunner in terms of strategic choice. It is used particularly by American and Japanese firms relocating staff abroad, but also remains a popular choice in Europe. It presents a clear and transparent approach to delivering remuneration to expatriates who will be returning to their home countries at the end of their assignments, and this approach ensures that they are able to slot back into home pay structures with ease, as home pay and pension continuity can be effectively maintained. This remuneration system was originally developed by the American oil industry deploying Americans primarily into oil-producing locations such as the Middle East. It enables the individuals to retain their home-country salaries, with additions paid to cover housing and schooling, higher cost of living and other expenditure, and allowances for hardship/health/climate and the like given as well if these factors are considered to be less favourable than at home. The principle underlining this payment system is that the employee should be no better or worse off. Home housing deductions, therefore, can be applied to ensure that the assignee does not profit through renting out home-country property while receiving free housing abroad. Cost-of-living calculations can be made more

efficient based upon a more local approach to purchasing goods and services, rather than comparisons being made based upon home-country spending patterns. The balance sheet is underpinned by the principle of tax equalisation. As such, effort can be made to contain the cost of this remuneration policy. However, there is no doubt that this pay approach is expensive, given the range of allowances and benefits that are typically provided to assignees receiving this form of compensation delivery. While it theoretically works for any combination of home/host pairings, assignees moving from low-cost to high-cost locations will require significant uplifts, as their basic salaries cannot provide sufficient remuneration to live in such destinations. Although the balance sheet is a popular choice, providing, as it does, economic neutrality for the assignee, it does requires regular updating (for example, to keep abreast of changes in the cost of living), plus considerable administration and monitoring. It is less relevant for globally mobile populations and for those assignees who are not envisaged to return home. Given that it is expensive, it may not be the best choice for assignees who are going on developmental assignments, who might well be motivated to take a post abroad to further their career development, and therefore may not require all the ‘bells and whistles’ that frequently apply under the balance sheet. It is thus important to take care not to give the most generous package just to get people to go.

Host-based pay The main alternative choice is to use a host-based approach to reward. This is significantly cheaper, as, if adopted in its purest form, it would mean that expatriates were paid exactly as locals, with no add-ons. Of course, this may not prove motivational to attract individuals and their families to uproot themselves and move, and hence it is usual for some additional support to be given, most notably in relation to housing abroad and children’s schooling. One of the other main advantages is that it is not complex to administer. On the ground, it provides peer equity, and as such it is a helpful approach to use when an organisation is transferring multiple assignees from differing national economic backgrounds to work with locals in the host country. However, on the downside, individuals are unlikely to be attracted to work in low-pay countries, and, if sent to high-pay countries, are not likely to be willing to move on or back home: a potential loss of equity with the home country makes repatriation very tricky. As such, this approach to remuneration has a major disadvantage – it can seriously hinder mobility and, with that, the transfer of knowledge. Added to this are potential exchange-rate problems in unstable economic locations. So this approach can present more disadvantages than it does advantages. If cost containment results in reduced mobility, then this approach will not be the best way forward. continues on p18

16 | Re:locate | Winter 2014/15

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Workforce Mobility Strategy. Optimised.

COMPENSATION

After a series of acquisitions, one of the world’s leading science companies wanted to optimise its global workforce mobility program. We helped elevate their game, building eﬃciency across continents, harmonising policies and identifying two million dollars in savings along the way. And while we can’t The global approach The global approach to remuneration involves devising a pay system that applies specifically to mobile personnel, and, as such, they maintain equity with other expatriates rather than with home- or host-country peers. This approach is typically applied to cadres of senior managers who are continually internationally mobile and do not return to a home country. Such a system is also sometimes used for graduates on development programmes who are asked to spend two or three years on the move, typically spending six months in a series of host countries, perhaps with very different standards of living or economic wealth. The global approach requires an international pay scale to be devised and implemented in such a way that it can be applied to all leaders regardless of the home/ host-country pairings. This can be complex to design, set up and administer, and can prove problematic in terms of exchange-rate fluctuations. Pension provision will normally be offshore, and this also requires additional administration.

Strategic choice Strategy is about choices and the consequences that flow from them. There is no doubt that, as AIRINC noted, more thought is going into the process of designing and implementing international assignment compensation systems today. As speakers from Mercer and Atkins pointed out, any choice must reflect the strategic direction of the organisation and its culture. Talent management objectives must also be examined, as these should drive the approach taken.

Rationales for including particular elements in the package (such as hardship payments) should be considered. The pros and cons of different approaches to remuneration also need to be matched to assignment types. For example, short-term and commuter-style assignments are typically remunerated on a home-country basis, but the packages are modified to suit assignment lengths and patterns. Different pay approaches can be used for skills-driven assignments versus developmental assignments – the former potentially requiring a ‘richer’ package than the latter. However, it is critical to preserve equity among assignees undertaking expatriation for similar reasons. The days of the traditional view that one policy suits all, with repatriation as the norm and job guarantees on arriving home, are long gone. Today, remuneration approaches need to embrace an expanding global mix of sending and receiving countries, diversity in the assignee population, and the requirement to manage talent globally. While cost control remains important, today’s emphasis is not about trimming and demotivating staff as a result. Instead, the emphasis lies on cost efficiency and effectiveness by using sensible tax planning and policy segmentation to achieve organisational objectives embracing global talent management while recognising multigenerational and diverse workforces with differing needs and expectations.

guarantee million dollar savings every time, we can promise to show you faster, easier and more cost-eﬀective ways to deploy key talent to drive your global business strategy, so that your company achieves more with every move you make.

For international assignments news and articles, visit

relocatemagazine.com/internationalassignments

weichertworkforcemobility.com | +44 (0) 1293 813810 18 | Re:locate | Winter 2014/15

SPONSORED BY:

GRAEBEL

Tune in to our new series of webinars, and get on the fast track to awards success. Register at relocateglobal. com, where you can also sign up for our special awards newsletters.

OUR SPONSORS Through association with relocation’s premier awards, our sponsors and supporters – who are vital to the success of the Re:locate Awards – position themselves at the forefront of the relocation sector. We are thrilled that serviced accommodation provider BridgeStreet Global Hospitality and international removals and relocation company Graebel have signed up to sponsor for the first time this year. “BridgeStreet Global Hospitality is honoured to sponsor the Best International Destination Services Provider award, celebrating the successes of all nominees. The Re:locate Awards set an industry standard for best practice and innovation, to which BridgeStreet aspires,” said Shaun Hinds, managing director of international operations. If your company would like to sponsor an award, please call us on +44 (0)1892 891334, or email ads@relocatemagazine.com

HOW TO ENTER It’s easy – and free – to enter! See relocatemagazine.com/awards-2014

AWARD CATEGORIES TECHNOLOGICAL INNOVATION IN RELOCATION INSPIRATIONAL HR TEAM OF THE YEAR Sponsored by Graebel BEST MANAGING OR GROWING TALENT INITIATIVE BEST HR & SUPPLIER STRATEGY OR TEAM Sponsored by Cheval Residences RELOCATION SERVICE PROVIDER OR TEAM OF THE YEAR Sponsored by Skyline Worldwide BEST PROPERTY PROVIDER OR SOLUTION FINANCIAL SUPPORT & INNOVATION IMMIGRATION TEAM OF THE YEAR Sponsored by Smith Stone Walters GLOBAL HEALTH & WELLNESS EXCELLENCE IN EMPLOYEE & FAMILY SUPPORT BEST INTERNATIONAL DESTINATION SERVICES PROVIDER Sponsored by BridgeStreet Global Hospitality RELOCATION PERSONALITY OF THE YEAR

KEY DATES AWARDS WEBINARS 12 December 2014 onwards ENTRY DEADLINE Friday 13 March 2015 JUDGES ANNOUNCED Spring 2015 GALA AWARDS DINNER Thursday 14 May 2015

ENDORSED BY: 26 | Re:locate | Winter 2014/15

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MIDDLE EAST

OIL& GAS

COPING IN CHALLENGING TIMES

ith a huge amount of the world’s oil and gas located in the Middle East, the region is expected to continue being one of the primary suppliers of energy well into the future. Despite the sector’s economically promising future, however, it faces significant challenges in maintaining a workforce that’s fit for purpose.

While reserves are plentiful, instability in the region has limited growth, most notably in Iraq and Syria. International sanctions against Iran have also played a part. Lumping together the Middle East and North African countries such as Egypt and Libya, BP’s group chief economist, Christof Rühl, noted in a speech, “Cumulative supply disruptions since the advent of the Arab Spring from these countries have reached an extraordinary three million barrels per day.”

other end. Education provider Pearson has noted particular shortages of workers with qualifications in the production processes, electrical, mechanical, pipe-fitting, drilling operations and plant construction fields. The skills gap is a particular issue in the Middle East, where a lack of domestic talent means that the region’s oil and gas workforce is dominated by expatriates, some 86.5 per cent of workers having been brought in from abroad. This situation isn’t being helped by a number of government initiatives giving priority to domestic hires. “The Nitaqat system in Saudi Arabia is impacting hiring in the private sector in a way which we are not seeing in the UAE,” Chris Greaves, managing director of Hays Gulf Region, told Re:locate. “A large number of companies have had to hire Saudi nationals in order to get themselves to Green or Premium status, where they are once again free to hire expats. “In Oman, although quotas seem to be less formal than in Saudi, the government is regulating expat labour entering the private sector, particularly in roles which can be easily ‘Omanised’. It is not unusual to see a job post being held open for a period of time for an Omani national, and a company only being allowed to hire an expat once a deadline has passed and the company can demonstrate it has taken certain measures to hire an Omani. This obviously slows down the hiring of expats. Kuwait has publicly declared that it intends to reduce the number of expats in its workforce.” Hiring expats is not a problem across all territories, however. “In Qatar it’s not really an issue, as the national population is too small, and the scale of development too large, to make widespread ‘Qatarisation’ practical,” Mr Greaves said. He also noted that in the United Arab Emirates ‘Emiratisation’ is only really a factor in the public sector. Women are widely seen as an untapped source of skilled labour in the sector. In 2013, the gender split was overwhelmingly in favour of men, with 95 per cent of staff being male, according to the Hays Oil & Gas Salary Guide. Steps have been taken to address this, such as the Petroleum Institute of Abu Dhabi’s creation of a women’s facility to expand the number of female undergraduates entering the industry. There remain significant cultural hurdles, however, particularly in the field.

Addressing skills shortages

Salaries, bonuses and benefits

While demand for oil and gas is expected to increase as developing nations like India adopt increasingly middle-class lifestyles, skills shortages are widely accepted as a serious problem facing the energy sector, and the Middle East is no exception. The Society of Petroleum Engineers has estimated that as many as 50 per cent of skilled workers in the sector may retire in the next five to seven years, potentially leaving a huge void in the workforce.

While the Middle East continues to rely on expats to staff its oil and gas sector, Hays has noted that bonuses and benefits may need to increase in order to attract and retain talent. “We are seeing tensions emerge between jobseekers, who are looking for reasonably substantial increases in pay when moving jobs, and employers, who are still very cost conscious and trying to keep a lid on salaries,” said Chris Greaves. “It is not unusual to see employers make an offer at, or below, a jobseeker’s current package. We don’t believe that the rent-driven cost-of-living increase we have seen over the last 12 months has yet fed through to salary inflation.”

The International Energy Agency’s 2013 World Energy Outlook report characterised the Middle East as “the centre of the longer-term oil outlook”, in spite of recent stagnant growth. The next decade will see demand for the region’s oil weakened, thanks to rising output from the US, Canada’s oil sands, deepwater production in Brazil, and international supplies of natural gas liquids. By the mid-2020s, however, these supplies are expected to dwindle, and the Middle East will resume its position as the biggest global producer. In terms of pure resources, the Middle East sits comfortably as world leader. BP’s Statistical Review of World Energy, published in June, shows that, as of the end of 2013, the Middle East held 47.9 per cent of the world’s proven oil reserves. Saudi Arabia had the biggest share of that, with 15.8 per cent of reserves, followed by Iran and Iraq, with 9.3 per cent and 8.9 per cent respectively. In terms of extraction, the region as a whole produced some 1,329.3 million tonnes, or 32.2 per cent of the world’s total. Again, Saudi Arabia had the lion’s share, with 13.1 per cent of total global production. Iran (4 per cent), the United Arab Emirates (4 per cent), Iraq (3.7 per cent) and Kuwait (3.7 per cent) were also major producers. Similarly, the Middle East has 43.2 per cent of the world’s proven natural gas reserves, with Iran holding nearly half (18.2 per cent), followed by Qatar (13.3 per cent). Total production, however, was 16.8 per cent of the world’s output, with Iran producing nearly a third of that.

As global demand for energy increases, the Middle East’s oil and gas sector is facing a range of challenges, from political instability and stagnant economic growth to skills shortages, lack of diversity, and government initiatives giving priority to domestic hires. Mark E Johnson reports.

Meanwhile, a lack of STEM (science, technology, engineering and mathematics) graduates means that an insufficient level of talent is entering the industry at the

continues on p30 28 | Re:locate | Winter 2014/15 2014

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Mr Greaves also said that the length of time it took to get hired could be an issue. “Our record is 18 months; the lady in question had a baby between the first interview and starting employment.” The logistics of relocating families (particularly arranging schooling) can be a hurdle. Increasingly, unpredictable security vetting, particularly in government-owned entities, can be an issue, and job offers can fall through at this stage. The region continues to exert a strong pull for expats, however, with a mixture of lifestyle, financial (no personal taxation) and career development benefits. “Plenty of opportunities still exist for expats, and will continue to do so,” Chris Greaves said. The challenge is to make the scales balance with bureaucratic hurdles, depressed salaries, and the push to develop local talent in order to meet the Middle East’s oil and gas skills needs.

Middle East relocation Alive and well?

Global Relocation Consultants has been working in the Middle East and North Africa for more than 20 years. Louise Whitson spoke to its Re:locate-award-winning founder about her perspective on the relocation scene in the region.

ne of the relocation industry’s trailblazers, Mona Radwan, founder and president of Cairobased Global Relocation Consultants, entered relocation 20 years ago and subsequently established Global Relocation Consultants, which became the Middle East’s first professional relocation company. It is now the most experienced destination services provider in the region. Mrs Radwan was the first Arab Muslim woman to become a member of EuRA and Worldwide ERC, and produced the first Middle East country guides for relocatees during the 1980s. She won Re:locate’s prestigious Relocation Personality of the Year award in 2013/14. LW: How is the current business, economic and political environment affecting relocation in the Middle East? MR: Of the 21 destinations we cover, we have had to put four on hold temporarily, for safety reasons. These are Iraq, Libya, Syria and Nigeria. In Morocco and Tunisia – other destinations that were affected by the uprisings – we haven’t noticed a decrease in the volume of expatriates. In Egypt, where we are headquartered, we were pleased to see even

more interest from multinational businesses that saw the opportunities in buying local businesses and setting up new projects. They subsequently brought over teams of expatriates to support their operations, and needed help with both relocation and immigration.

LW: Is the unrest in parts of the region affecting companies’ plans for transferring staff, or employees’ willingness to undertake assignments? MR: In the destinations we are covering at present – Egypt, for example – expatriates have historically been based in the safe areas. Most of them live in gated compounds, and their way of life hasn’t changed at all. As before, they use a car with a driver to move around the city. They shop in the same malls, and go to the same restaurants. Even during Egypt’s most difficult days, the only recommendation we gave to our expats was to avoid the places where the demonstrations took place and limit going out in the remote areas at night. All expatriates fall in love with the country, the people and the weather, and we see many cases in which assignees and their families are sorry to leave for another destination or return home. LW: What types of employee are being relocated or sent on assignment, and from which countries, regions and business sectors are they coming? MR: We have seen no change in the type of employees associated with the very large, global businesses. The majority of them are European or American nationals, still middle and top management. Most of them belong to the FMCG and financial sectors. However, in the petroleum sector, we have noticed African employees being relocated to Egypt more frequently than before. LW: For people moving to the Middle East from other parts of the world, some degree of ‘culture shock’ is almost inevitable. How can it be mitigated, and how can assignees be helped to acclimatise to their new surroundings? MR: Most expats will indeed go through culture shock, especially those who come to the region for the first time. We advise all clients to include cross-cultural training in their relocation packages, as the cost is minimal compared with the benefits to assignees and their families. Crosscultural training, along with our experienced consultants, who accompany assignees step by step during the relocation process and explain local customs, can decrease the level of stress they face. Regrettably, companies usually prefer to save on training and then try to manage stressed employees who do not perform as expected in their new roles. This does not always work.

LW: How has relocation changed during your 20 years in the sector, and what are your predictions for its future? MR: The relocation industry has changed dramatically during the last 20 years. If, before, we were delivering standard relocation services like home search, orientation, settling in and schooling, now clients expect their destination services provider (DSP) also to assist with immigrationrelated issues, or at least be knowledgeable enough to be able to give advice on visas and other immigration documents. Relocation has become more of a science, with procedures clearly outlined, best practices shared, and quality standards (such as the EuRA Global Quality Seal) applied. What’s more, there is a constant need to battle the competition. There is an expectation that high-quality services will be delivered for a much lower rate, to allow the relocation management companies (RMCs) to compete for the client. The bottom line is that the pressures on DSPs are greater, while RMCs no longer offer lifetime service agreements. At the same time, assignees expect more of their DSPs, based on their experience of being expatriates in other countries. We need not merely to match their experiences but to exceed their expectations. Today’s DSPs are required to understand not only the culture of the destination country but also the culture and background of the assignee, in order to find the best approach. Another point worth mentioning is the way in which the housing market has evolved. In the 1980s and early 1990s, the housing available to expats in Egypt consisted of Egyptian homes rented out by their owners, which did not suit most expats. During the later 1990s and early 2000s, buildings and compounds were built to satisfy the tastes of the expatriate community and its desire for security. This changed the real-estate industry in the Middle East and North Africa, attracting agents to offer what was not always the best service. Now, street agents cause relocation professionals a great deal of trouble. We have to choose estate agents carefully and keep blacklists of those who do not comply with our regulations. If you know someone who deserves to be our 2014/15 Relocation Personality of the Year, please contact Vanessa McConnell (awards@relocatemagazine.com, +44 (0)1892 891334).

To enter the Re:locate Awards 2014/15, visit

relocatemagazine.com/awards-2014 Categories for HR and suppliers

30 | Re:locate | Winter 2014/15

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MIDDLE EAST

resources personnel, most of these positions are being filled by Emirati women.

MIDDLE EAST Women gaining ground Women are slowly but surely starting to play a leading part in some Middle Eastern economies, and a quiet economic evolution looks set to take place in the shadow of the region’s political revolutions. As part of Re:locate’s Developing Women Leaders strand, Shân Norman, VP of client services at our 2013/14 Best Managing or Growing Talent Initiative award winner Crown World Mobility, looks at the challenges they face, and gives advice on etiquette for business people visiting the Middle East.

n a global platform, women face a number of challenges which can impact their success in the workplace. In the Middle East, these issues are further compounded by cultural perceptions that women are less capable, more irrational, and better suited to domestic responsibilities. These patriarchal attitudes and traditionalist values have been difficult barriers for women in the region. Among a diverse community of international businesswomen facing similar challenges, there is now a growing movement of women leading and driving business initiatives. As the region continues to change and develop, a significant number of women are reaching positions of influence in business, politics, civil society, academia and the media, with a growing number of entrepreneurs leading successful start-ups. As a result of this success, they have not only been able to impact the industries in which they work, but are also having an important impact on the Middle East region as a whole.

32 | Re:locate | Winter 2014/15

Winds of change Progress is gradual, and there is a long way to go before women in the region achieve the equality enjoyed in other parts of the developed world. According to the World Bank, just 28 per cent of the adult female population is economically active; this is the lowest percentage in the world. Additionally, most female employment is concentrated in low-level positions. Due to increased literacy and educational opportunities, there has been a steady rise in the number of working women. Families are also recognising the benefits of financial support provided by their wives or daughters. Gulf women have also benefited from government policies designed to reduce reliance on foreign labour. Companies have recruited greater numbers of female workers in order to meet newly established quotas for citizen employees. For example, since the United Arab Emirates (UAE) no longer allows foreigners to work as secretaries or human

More women than men are now being accepted into university, despite requirements by some universities that women achieve higher grades than men. A marked shift in enrolment has been seen from fields of study once considered traditional female subjects, such as teaching and healthcare, into the male-dominated fields of science and engineering. In 2008, women in Qatar were accepted for the first time in the fields of architecture and electrical and chemical engineering. In Saudi Arabia, three educational institutions began to permit women to study law in 2007, although their graduates are only allowed to act as legal consultants to other women and are still prohibited from serving as judges and advocates in court.

For the international businesswomen of the UAE, their continuing advancement means a potential market with wide possibilities for women-centred services, products targeted towards women, and the possibility of investing in womenowned businesses. These are only a few of the many international women determined to advance the opportunities for women by talking the language of business: networking, accessing capital and mentoring. If they are successful, it will be a quiet economic evolution that takes place in the shadow of the region’s stormy political revolutions, where it’s unclear how women will fare in the longer term.

Etiquette tips when travelling to the Middle East Things to do

espect the privacy and protected role of women in •R Arab societies

• Remember that men stand when women enter a room • Respect the different living areas for men and women o not expect women to eat or socialise in the same •D room as men

Progress being made

Things not to do

The success of these changing times is seen in the growing list of Middle East businesswomen included in prestigious rankings, including Forbes International, Arabian Business and Forbes Arabia. It is clear that women in the Middle East are more visible and their influence is felt across many sectors of business, despite the fact that they continue to represent a small minority in society. They are often seen as role models and change agents for the Middle East.

o not shake hands with an Arab woman unless she •D

Sheikha Lubna bint Khalid bin Sultan Al Qasimi, currently the UAE’s Minister for Foreign Trade, started her career in what was deemed a male-dominated industry as the only female software designer for the Dubai Port Authority in the early 1990s. In November 2004, she was appointed the UAE’s Minister of Economic and Planning and became the first female to hold a ministerial post in the UAE. In a region where change comes slowly, there is a definite shifting of the gears, specifically in the UAE and Saudi Arabia. With more senior-level appointments, such as the that of Muneera bint Hamdan al-Osaimi as the new Assistant Under-Secretary for Medical Services Affairs in the Ministry of Health, it is a sign of creeping reform in this ultra-conservative kingdom, where women are prohibited from driving, must work in segregated facilities, and were only recently granted the right to vote and run in municipal elections. Over the years, women have taken up roles in a wider variety of industries: in medicine, as practising surgeons; in engineering, as well engineers and IT engineers working on offshore oil platforms; in banking and finance, as business professionals leading multimillion-dollar operations – all once very much male-dominated fields.

offers her hand first, or if you are a woman. Do not flirt with, touch, hug or talk in private with women. This could endanger their safety • Do not talk in public to professional Arab women unless the conversation is business related • Do not try to engage a woman in conversation unless you have been formally introduced o not stare at women or maintain eye contact •D o not ask an Arab man questions about his wife or •D other female members of his family

Business attire

• I n certain countries in the Middle East, women are

required to wear veils or have their hair covered in public. Female executives travelling to the Middle East should take care to heed particular policy for the country in which they will be conducting business • The mixing of men and women is forbidden in certain countries • Women are discouraged from wearing trousers; skirts are greatly preferred nees and elbows must be covered at all times, and •K a high collar is required. Generally, neutral colours are preferred

And finally …

ever refuse food or beverages from your hosts, as •N this can be viewed as the ultimate sign of discourtesy in most of the Middle East

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Watch the

SECTIONACS HEADING film

MIDDLE EAST

CHOOSING A SCHOOL in the Middle East Recent research has revealed that the fierce competition for places in international schools in the Middle East requires families to act well in advance of relocation if they are to ensure a place at the school of their choice. While the rate of growth in the region’s international schools is impressive, how can relocating families be sure that they are securing a quality education for their children in such a rapidly expanding market? Rebecca Marriage investigates.

hile there is evidence of strong and continued growth in the Middle East’s international school sector, expatriates are facing direct competition from an increasing number of local families who are choosing to send their children to English-speaking international schools. According to the International School Consultancy Group (ISC), a provider of research and market intelligence on the world’s international schools, there are currently more than 1,300 English-medium international schools throughout the Middle East. All deliver learning in English, but they vary significantly in size, the facilities on offer, the level of fees charged, and the favoured curriculum, examinations and learning systems. The United Arab Emirates (UAE) leads the region, with well over 400 international schools. These attract expatriate students, but Emirati nationals make up a significant percentage of the children on roll. The majority of the UAE’s international schools are located in Dubai and Abu Dhabi. Of the seven Emirates, Dubai has the highest proportion of expatriates and the highest concentration of international schools. Local Dubai families are increasingly choosing international schools for their children, and, as there are no limits on the enrolment of local students at international schools in the UAE, the combined demand from both local and expatriate families is fuelling the continued growth. Clive Pierrepont, director of communications at Taaleem, an international school group with schools in Dubai and Abu Dhabi, believes that competition for places is helping

to create stability, and that the future is looking bright for families relocating to the region. “The 2014/15 academic year has been seen as a game changer by many and is good news for parents seeking places for their children,” says Mr Pierrepont. “There is equilibrium in the market. Eleven new schools have opened in Dubai, providing 23,000 places, and 14 new schools have opened in Abu Dhabi, and will bring 18,000 new seats to the Northern Emirates.” In 2010, the UAE government launched UAE Vision 2021, which, according to a spokesman, “aims to make the UAE among the best countries in the world by the Golden Jubilee of the Union”. One of the UAE’s priorities is its education system, which it aims to transform by 2021. In line with UAE Vision 2021, Taaleem is making significant progress on new school developments. In September, the group completed the third phase of its Uptown Campus in Mirdif. The Dubai British Foundation School, in Jumeirah Islands, opened this year, and will feed into the new Dubai British School, in Jumeirah Park, due to open in September 2015. “On top of these developments, another 10,000 new places will become available in the academic year 2015/16 in Dubai alone,” says Clive Pierrepont. Dubai’s Knowledge and Human Development Authority (KHDA), which is responsible for private education, anticipates an increase in enrolment at international schools of 7 per cent per year for the next five years, and is planning significant school expansion, which will go some way to meeting that demand.

When did a school make you feel this good? Families just know when a relocation works. Whether you are a mom or dad, toddler or teenager, HR or relocation professional, from Texas or Tokyo, when all the pieces come together, it can deliver one of life’s most rewarding experiences. ACS understands the complex needs of globally mobile families. We have partnered the relocation industry since 1967 to meet the many challenges that face international families. Our campus-specific Admissions, Housing and Transport experts work closely with parent-assisted Welcome Teams, International Groups, Parent/Teacher Organisations and Buddy programmes to create a smooth, seamless and happy transition. That is why each year literally hundreds of families from more than 70 countries make ACS ‘the’ regional solution to their educational and lifestyle needs. To find out more about us, and our world renowned programmes, please visit www.acs-schools.com. Alternatively call either ACS Cobham +44 (0)1932 869744, ACS Egham +44 (0)1784 430611, ACS Hillingdon +44 (0)1895 818402. ACS schools are non-sectarian and co-educational (day and boarding) for students 2 to 18 years of age.

continues on p36

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MIDDLE EAST

Parents demand high-quality education The individual requirements of parents when searching for a school for their children will vary, of course, but some interesting research has emerged this year which has helped to clarify the priorities for families in the UAE. Following a new study into the attitudes of parents in the UAE, the findings have confirmed that academic record, extracurricular activities and technology far outweigh fees and location in importance. The YouGov Education Investment Study surveyed approximately 500 parents throughout the Emirates to understand the key factors that affected a school’s reputation. It found that, when evaluating schools, parents regarded academic record as the most important factor, followed by overall reputation, range of subjects taught, range of extracurricular activities on offer, and facilities available. Functional attributes, such as the proximity of the school to home, ease of access and school fees, were deemed less important, suggesting that parents in the UAE are willing to pay higher costs or travel further in order to place their child in a school with a strong academic record. The survey found that, overall, 44 per cent of parents believed they received good value for money from their child’s school, citing factors such as the quality of the class

teacher, positive word-of-mouth recommendations, and the quality of the headteacher as attributes which contributed significantly to their perception of value for money.

Assessing the quality of education on offer But assessing the quality of education on offer is not an easy task for families moving to the region, especially when they are required to compile a shortlist before making the move. Fortunately, Dubai’s KHDA sets strict regulations for the standards of international schools. Accreditation is mandatory, and the KHDA’s Schools Fees Framework, which was introduced in 2012, only allows schools to raise their fees in accordance with an Educational Cost Index declared by the Dubai Statistics Centre, and a quality rating issued by the Dubai Schools Inspection Bureau (DSIB). The KHDA also publishes individual annual inspection reports for fee-paying schools in Dubai. The DSIB reports are available on the KHDA website. Of the 141 schools inspected, 12 were rated outstanding, 57 good, 64 acceptable, and eight unsatisfactory. “We encourage all parents to read the school reports in full,” says Jameela Al Muhairi, chief of DSIB at KHDA. “Parents should be fully informed of the strengths and weaknesses of their child’s school and have a comprehensive understanding of its progress over the past year.”

At ISL, I acquired the skills and attitudes for university success: essay writing, critical thinking, open mindedness, problem-solving and thinking outside the box. Anna

Anna joined the International School of London (ISL) from Finland for the International Baccalaureate (IB) Primary Years, Middle Years and Diploma Programmes. She achieved the top mark of 45 points in her IB Diploma exams and currently studies Art at Edinburgh University. The ISL Schools in London, Surrey and Qatar integrate mother tongue and other languages into the IB curriculum from a young age, nurturing the global competencies critical for success at universities worldwide. ISL is helping its students turn dreams into reality.

ISL London Alumna

London +44 (0) 20 8992 5823 Surrey +44 (0)1483 750409 Qatar +974 4433 8600 www.islschools.org

36 | Re:locate | Winter 2014/15

The reports give a detailed account of the DSIB inspection findings. Key factors analysed include the social and personal development of students, the standard of teaching and assessment, the quality of the curriculum, health and safety, school support, and leadership.

Qatar As in Dubai, international schools in Qatar face government control of tuition fees. The growing preference of Qatari families for an international school for their children, as well as new infrastructure projects in the region, which are attracting more expatriates, are together increasing the demand for international school places in Qatar. The Supreme Education Council (SEC) in Qatar runs its own Outstanding Schools Programme. According to the SEC, Outstanding Schools are selected from top schools throughout the world which teach accredited international or national curricula. Students from these schools, it adds, are routinely admitted into the world’s most prestigious universities. In addition to implementing the curriculum model from their home campus, all Outstanding Schools in Qatar teach Arabic, Islamic studies and Qatari social studies. One of the first schools established under the Outstanding Schools Initiative, the International School of London Qatar, opened its Qatar branch in 2008. Alongside this badge of honour, ISL Qatar, part of the ISL Group, which has schools in London and Surrey, is also an International Baccalaureate (IB) World School, authorised to offer the IB Primary Years, Middle Years and Diploma Programmes. Diploma results this year have proved that ISL Qatar students are among the highest-achieving IB participants across the world. In fact, three ISL Qatar students achieved International Baccalaureate (IB) Diploma results that place them in the top 15 per cent of students worldwide. Amin Makarem, managing director of the ISL Group, says that, when researching schools, parents “should check

student make-up, where teachers are recruited, external examination results, or standardised tests if applicable, accreditations from agencies, and – very importantly – local government requirements, such as the children having IDs before they can be enrolled, and admissions deadlines, which are often also dictated to the schools.” Christopher Charleson, head of school at ISL Qatar, adds that parents should look carefully at a school’s website and see what activities and events students are involved in – usually by reading school newsletters and perhaps also by requesting a yearbook. “If there is information about university destinations,” he says, “that is also a good measure of the quality of a school.” ACS Doha, part of the ACS International Schools group, which has schools in London and Surrey, has also recently been authorised as an IB World School. Mark London, marketing manager of ACS International Schools, says of the IB accreditation, “Once authorised as an IB World School, parents and students can be confident that their school has a rigorous curriculum encouraging student curiosity and international mindedness, as well as teachers trained in the programme, and commitment to the sustainability and philosophy of the IB.” In addition, ACS Doha International School has been awarded full accreditation by the Western Association of Schools and Colleges (WASC), one of six US regional accrediting associations. “Accreditation is an important quality mark for an international school,” says Mark London, “recognising and demonstrating that the educational offering reaches the highest levels of teaching and learning.”

Beyond the UAE According to the ISC, Saudi Arabia offers extensive options for international schools, and there are good choices in Turkey, Kuwait, Jordon and Oman. Many of these schools will be accredited by the Council of International Schools (COIS), which demands that a member school “has achieved high standards of professional performance in international education and has a commitment to continuous improvement judged by peer review and self-study”. The Council of British International Schools (COBIS) and British Schools in the Middle East (BSME) have a similar accreditation process, but require their schools to have undergone an inspection by a UK government Department for Education-recognised body. Accreditation, of course, is just one of the means by which a family will judge the suitability of a school; there are many factors which will impact on their decision when making such a life-changing move. Relocating with schoolage children is one of the biggest challenges a family can face, and it is important not to underestimate the level of support and guidance that assignees will need in order to help make the right decision. See also The New Global Classroom (p60).

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PENSIONS

PENSIONS MIND THE GAP FOR MOBILE EMPLOYEES Massive changes to UK pensions legislation are seeing employees and employers revisit retirement savings. Ruth Holmes looks at the major changes and challenges ahead, and asks whether mobile employees will find a pension pot of gold at the end of their rainbow.

etting the stage for this year’s UK National Association of Pension Funds (NAPF) conference in Liverpool, Shadow Minister for Pensions Gregg McClymont declared, “Pensions are no longer boring.” Mark Boyle, non-executive chair of the Pensions Regulator, for one, seems to agree, saying, “I could scarcely have joined at a time of more seismic change in the industry.” Over the last decade, successive UK governments have introduced a slew of changes to legislation to improve the sustainability of pension funds. Alongside increasing the state pension age, perhaps the biggest change to date has been the rollout of auto-enrolment for employees in company schemes. Analysis suggests auto-enrolment is working, bolstering the UK’s national and employer pension schemes and encouraging greater saving. Around 4.5 million workers are now automatically enrolled in work-based pension schemes, and nearly 28,000 businesses have met their new legal obligations. While the rollout continues, the Department for Work and Pensions (DWP) estimates that around nine million people will eventually be saving for the first time, or saving more, thanks to automatic enrolment, which is paying dividends for the sustainability of the UK’s system. Following the introduction of such measures, the UK since 2008 has consistently improved its standing on the Melbourne Mercer Global Pensions Index (MMGPI), an international measure ranking pensions provision in 25 countries. While the UK’s overall position of ninth is unchanged from last year, the latest analysis finds that significant improvement in sustainability has seen the UK move up more than four basis points on the scale, from 48.0 in 2013 to 52.3 in 2014. “The UK has previously struggled with issues around sustainability, mainly due to the numbers of people covered by our pensions system,” Deborah Cooper, a partner at Mercer and the professional leader for its UK retirement business, explains. “The introduction of auto-enrolment, which is currently being phased in, has helped the sustainability rating in this year’s MMGPI. This will continue to improve over the next five years as the level of contributions increases and auto-enrolment completes.” The Chartered Institute of Personnel and Development (CIPD), the professional body for HR and people development, concurs. Its Labour Market Outlook: Focus on Pension Autoenrolment 2014 (see p41) highlights that not only are 68 per cent of eligible workers now automatically enrolled, but the vast majority of employers are contributing far more than the legal minimum to employees’ pension savings.

More change on the way So far, so good, it seems, for government-led changes. But the latest legal revisions proposed by the UK government are receiving a far more lukewarm response from pension fund managers, if not savers – including those working or planning to retire overseas.

38 | Re:locate | Winter 2014/15

The scope of UK Chancellor George Osborne’s recently ended consultation into the draft clauses in the pending Taxation of Pensions Bill covered both the plans to offer people aged 55 and above greater flexibility around how they access their pension savings and the limit on non-UK residents’ ability to offset UK-earned revenue against their personal allowances. However, some pensions industry experts have raised concerns about financial education and the range of products available. There are also concerns about mobile workers and those hoping to retire back to the UK having sufficient savings. Explaining the NAPF’s response to the draft legislation, Graham Vidler, the organisation’s director of external affairs, said, “The key to making these reforms to pensions taxation a success is keeping them as simple as possible for pension savers to understand and for schemes to implement. “But even with the help of guidance, many scheme members will find the options available to them from age 55 baffling, and will struggle to select an appropriate mechanism for turning their pot into an income. “Of the respondents to our 2014 Spring Workplace Survey, 30 per cent said they did not feel capable of deciding what to do with their pension savings, and even less (14 per cent) felt they would need no guidance at all on what to do with their savings.” The MMGPI also casts doubt on the UK’s continued improving performance if the rules around pension fund accessibility are relaxed as planned. The NAPF is urging the UK Treasury to work with it to develop simpler ways of communicating the options. Changes to the pension pot accessibility rules are likely to have limited impact for expatriates with qualifying recognised overseas pension schemes (QROPS), who are already familiar with pension savings flexibility. However, changes to offsetting rules could “hit expat pensioners hardest and force some to sever their ties with the UK,” according to Nigel Green, chief executive of international independent financial consultancy deVere Group. “Over the years, a significant number of UK expats have continued to maintain investments in the country, to

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PENSIONS

benefit from numerous tax advantages,” Mr Green explains. “However, should Mr Osborne’s plan come into effect, I am of the opinion that an increasing number of expats would cut all ties with their home country as the financial incentives diminish.”

Pensions for changing times Workplace and demographic changes are, of course, adding to the issues of equity, administration and education tied up in the cultural shift within pensions and legislation. We also know that mobility is on the rise. Estimates suggest that the number of global nomads (those continually on assignment overseas) has doubled in four years. They now account for 50 per cent of assignees. While it’s clear that the traditional defined-benefit employer pension scheme model is no longer fit for purpose and major change is afoot, there is also a real danger – especially with the localisation of expatriate packages and the relative lack of provision in newly emerged economies – that mobile and particularly expatriate employees could miss out on decent pensions savings schemes. Charles Cotton, pensions adviser at the CIPD, said in relation to the UK scene, “So far, pension automatic enrolment has been a success. It’s been a wake-up call we needed to get the UK saving for the future. However, in the coming months, we need to keep a close eye on the number of workers leaving the pension scheme and what can be done to encourage them to stay.” Already, around 12 million people aren’t saving enough for retirement, according to Department for Work and

Pensions data. As well as encouraging employees to stay in employer schemes, Charles Cotton advises employers to “explore ways that we can increase the amount of money going into saving for retirement. To do this, it’s essential that employers are encouraged to look at their employer’s pension contribution as well as their take-home pay when thinking about their total earnings.” Some anecdotal evidence reported from the floor of the NAPF conference suggested that, given the scope of the changes, starting a new scheme was more appropriate than tinkering with the existing one. Research from MetLife Employee Benefits seems to bear this out. According to the life assurance company, around a fifth of companies it surveyed are planning to review or introduce new benefits following the introduction of auto-enrolment. Tom Gaynor, employee benefits director at MetLife UK, comments, “It is important that the industry steps up to the plate and helps employers confront their uncertainties. Until this happens, we risk employee benefits in many organisations being determined on custom and practice of the past rather than the needs of employers and the workforce of the future.”

Pensions and mobility For UK-based or mobile workers overseas planning to retire to the UK, the changes hallmarking pensions legislation in the UK, Europe and the US – with the shift from state to employer responsibility – are beginning to gain ground elsewhere. “The tides of accountability for ensuring financial security in retirement are shifting from state and employer responsibility to individuals in many countries,” notes David

Knox, senior partner at Mercer and author of the Melbourne Mercer Global Pensions Index. “This trend will continue as life expectancy continues to increase and many governments reduce the per capita expenditure on their aged population. “This shift means communication to members has never been more important or come under more scrutiny from members, regulators, employers, consumer groups, politicians and the media.” This is likely to be positive news for expatriate workers outside Europe and the US, and an opportunity globally for employers to take the lead and do more than the minimum. For Peter Cox, Zurich International Life’s head of international pension plan sales for Asia Pacific and the Middle East, the employer’s ambivalence in addressing the need for retirement savings in his territory is often “the elephant in the room”, but it also presents “a huge opportunity”. “In the Middle East, for example, because salaries are taxfree they are high relative to other regions, and increasing, but pension provision is practically non-existent,” Mr Cox explains. “Instead, local labour laws dictate that companies provide an end-of-service (EoS) gratuity lump-sum payment. But all too often, employers have no separate fund set aside to cover this. A local Towers Watson survey shows that 84 per cent of companies settle employees’ benefits from company assets as they become due, which provides little comfort to supposedly ‘highly valued’ employees.” This presents an opportunity for employers to take the lead and do the right thing, and set up, depending on the company and its employee needs, a standalone pensions savings scheme that also includes the EoS entitlement. “Not only can employers benefit from the bulk savings that come from including all employees in one scheme, they would also facilitate the opportunity for employees to save for retirement, which is a significant differentiator in the Middle East and something most employers haven’t yet embraced. In terms of accessing data and supporting workforce engagement, plans can also be established with an employer-branded website, providing a more paternalistic feel to the arrangement. This encourages workplace savings and satisfies the need for information and guidance,” Peter Cox concludes. In the UK, almost half (48 per cent) of employers yet to be covered by the auto-enrolment legislation anticipate they will have to limit future pay growth to absorb the costs of pensions contributions, according to the CIPD study. Yet in a finding that should be reassuring to both this cohort and companies operating globally considering their pension scheme status, 22 per cent of those already covered by the legislation say there are no significant extra costs, and 38 per cent say they have been able to absorb the additional expense. Whether or not you agree with Gregg McClymont’s assertion about pensions, it’s likely that we are going to hear a great deal more about the subject – and the employer’s role in supporting valued workers as they save for retirement.

40 | Re:locate | Winter 2014/15

Auto-enrolment:

An opportunity to review pensions provision?

A new report from the Chartered Institute of Personnel and Development (CIPD) suggests that UK employers are going above and beyond their legal duties around pensions auto-enrolment and using the scheme’s rollout as an opportunity to revisit existing schemes.

ased on replies from 1,080 respondents from the private, public and voluntary sectors, the report, Labour Market Outlook: Focus on Pension Auto-Enrolment 2014, reveals that, of the 68 per cent of organisations which have introduced automatic enrolment, the typical employer contribution for newly enrolled members is 5.6 per cent (4.7 per cent for employees) – well above the 1 per cent legal minimum. Nearly half the respondents (46 per cent) said that the proportion of eligible workers who had opted out of pensions saving so far was under 10 per cent – less than originally forecast by the Department for Work and Pensions. Overall, 7.4 per cent of eligible workers had chosen to leave their company’s pension schemes. Opt-out rates were highest in accommodation, food service activities, arts, entertainment and recreation, information and communications, and administration and support services firms, where the average topped 10 per cent. The findings suggest that employers are committed to ensuring that their pension schemes are fit for purpose after the initial enrolment period. Seventy per cent have already carried out, or are planning, a review to ensure their arrangements meet the new legal requirements, and 57 per cent have reviewed, or plan to review, the way in which they communicate with employees about pensions. A further 51 per cent have already checked, or are planning to check, that pension arrangements support the business strategy, and have analysed, or plan to analyse, how the new arrangements are aligned to organisational culture and values (48 per cent). “Auto-enrolment is just the start,” says the CIPD’s Charles Cotton. “For pension schemes to remain relevant to businesses and employees, they must be regularly reviewed, to ensure that the plans are performing and that employees appreciate and understand what is being done for them and why.” We’ll be covering more of the burning HR issues from the CIPD Annual Conference and other events in our Spring 2015 issue and on the website.

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INTERNATIONAL PENSIONS ADVERTORIAL

Continually improving remuneration may help in the short term, but like a high employee attrition rate, this is unsustainable for most companies that have shareholders to please. It may also have the effect of inflating the ultimate end-of-service gratuity (‘gratuity’) entitlement. A focus on employee benefits could provide the answer, with corporate retirement savings schemes becoming the secret weapon in the battle for talent.

A blunt retention tool

UNLOCKING THE RETENTION POWER of the end-of-service gratuity Are corporate retirement savings schemes becoming the secret weapon in the battle for talent? Peter Cox, head of international pensions at Zurich International Life, Asia Pacific and Middle East, looks at how forward-thinking employers can create a retirement savings culture that benefits both them and their employees.

42 | Re:locate | Winter 2014/15

he competition for talent is heating up in the United Arab Emirates (UAE) and across the Gulf Cooperation Council (GCC) countries. The 2014 GCC Compensation Survey found that 51 per cent of employers had increased their employee headcount. This number is likely to grow as the region continues its economic recovery, helped by additional investment and job creation generated by Qatar’s hosting of the 2022 FIFA World Cup and Dubai being selected to host the 2020 World Expo. Attracting and retaining employees will therefore become a strategic priority for the majority of companies. In the GCC Compensation Survey, more than 40 per cent of employers already reported an 8–10 per cent attrition rate in 2013, with nearly 20 per cent reporting an attrition rate of 10 per cent or more. Employers are finding it increasingly challenging to retain their best staff and deal with the cost and disruption of replacing talent.

The gratuity is a retention tool. Legislation underpinning the gratuity goes back to the 1980s, and it was designed to compensate expatriate workers for the fact that no government scheme exists for them to build up basic retirement savings. The amount of the gratuity payment depends on the employee’s salary at the time they leave service and how long they have been with their employer. In short, the longer an employee stays with an employer, the greater the reward. However, the gratuity is currently a blunt instrument in terms of employee retention. A recent YouGov survey of 1,000 UAE residents, commissioned by Zurich in July, found that 59 per cent were not able to calculate the value of their gratuity. How can the gratuity ever be viewed as a retention incentive if employees don’t even know its value? Rather than being viewed by the HR team as a potential employee benefit, the gratuity is labelled a liability by the finance team, as there is no legal obligation for a company to accrue the funds required to pay out its employees’ gratuity liabilities. Worryingly, this liability is growing fast. A 2008 report from the UAE Ministry of Labour revealed that the average length of service was four years and seven months. At that time, the average salary was AED10,120 per month. Today, the average service has increased to approximately six years and ten months, and the average salary is now approximately AED14,380. This increase in service and salary equates to a 140 per cent increase in the gratuity entitlement, yet these increasing liabilities largely remain unfunded in the region. In a recent survey from Towers Watson, 88 per cent of companies indicated they settled employees’ benefits from company assets as they became due. So is there a better way of rewarding employees that also ensures the chief financial officer doesn’t have sleepless nights?

The vast majority of employees also believe that the gratuity is an inadequate method of saving for their retirement years, with only 17 per cent of employees believing the gratuity provides sufficient funds to cover the cost of retirement.

Creating a retirement savings culture In Europe and North America, the retirement savings culture is facilitated by employers who provide retirement savings schemes for their employees. But most employers in the UAE do not provide their employees with an opportunity to save for their retirement; instead, many consider the gratuity to be a satisfactory alternative. However, our research shows that this is an error of judgment that creates an opportunity for forward-thinking companies. To encourage a savings culture, companies should set up a corporate retirement savings plan for their employees that moves beyond making a simple promise to pay a gratuity to providing a true employee benefit. It can incorporate the existing gratuity obligation and do so within a more structured savings vehicle that acts as a retirement fund and a more effective employee retention tool. Forward-thinking companies that listen to this demand will find they become ‘employers of choice’ with significantly improved recruitment and retention results. Employees will have a valued opportunity to save for retirement, and employers can both cover their gratuity liabilities and compete more successfully for the best talent. It’s time to put the power of corporate savings to work. www.zurich.com

What benefit would make you more inclined to stay with your current employer? 1. Retirement savings plan (58 per cent)

What do employees want?

2. Life insurance (35 per cent)

The answer can be found in the same YouGov survey. Almost two-thirds of respondents (58 per cent) said that they would be more inclined to stay with their current employer or join another company if they were provided with a corporate retirement plan. Interestingly, research commissioned by Zurich at the beginning of 2014 found that only 33 per cent of UAE residents had a formal retirement plan.

3. Critical illness cover (31 per cent) 4. None of these (21 per cent) Respondents could select more than one option (Zurich/YouGov End of Service Gratuity Survey)

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LATIN AMERICA

CULTURAL PERSPECTIVES

in Latin America

At Worldwide ERCâ&#x20AC;&#x2122;s Latin America conference, Vanessa Oliva, HR director of Colombian company Quala, based in Sao Paulo, and Maria Luiza Delavy, HR manager of Scania Latin America, explored the challenges companies faced in dealing with differences in culture between Brazil and wider Latin America. Fiona Murchie reports.

lively and engaging speaker, Vanessa Oliva spoke about her experiences as HR director for Quala in Brazil. Quala is based in Colombia and, as one of the ten best companies to work for in Latin America, has a hugely established brand and reputation there. Quala is a large multinational food company with a range of consumer products across food and drink as well as homecare. Headquartered in Bogota, it is also in nine other countries, including Brazil, Mexico, the Dominican Republic, Ecuador, Peru, Venezuela and Guatemala. With such a large consumer population, Brazil holds huge potential for market growth for Quala. Getting to grips with the cultural differences is essential to its plans. One of her challenges, said Ms Oliva, was establishing the employer brand in a country where the company was not well known. In Colombia, everyone wanted to work for Quala, and there was employee loyalty and engagement with families and the local community. A company anthem and wearing company wristbands, for example, were popular in Colombia and other Latin American countries, but not in Brazil. Loyalty in Brazil was noticeably more to the manager than to the company, and this would obviously impact when someone left the organisation. There were also significantly fewer women employees. Promoting women in the workforce, and diversity issues in

44 | Re:locate | Winter 2014/15

general, were at different stages across the Latin America region â&#x20AC;&#x201C; something companies must be aware of. Communication and engagement were all part of the process of establishing the Quala employer brand, and building trust took time, as multinational organisations discover wherever they are operating in the world.

Scandinavian twist Maria Luiza Delavy talked enthusiastically but pragmatically about her experience of working for a multinational and managing the objectives of the Swedish HQ within its Scandinavian guidelines in the Latin America context. Many HR and global mobility specialists working globally will empathise with her situation. Scania Latin America has its regional HQ in Brazil, with 2,000 employees throughout the region. Sites vary in size from 35 to 500 employees. The companyâ&#x20AC;&#x2122;s trucks and services are well known in Brazil, with a strong brand, but there is a lot of competition overseas. When Ms Delavy began work there in 2012, each region had its own HR. With the goal of standardisation to achieve, she needed to adopt a focused yet flexible approach, reporting to corporate HQ, answering to a VP and HR bosses in Scandinavia and managing their expectations, while at the same time

accommodating the requirements of her regional HR and business leaders. As with all the best strategies, communication proved to be the key, and she saw it was essential to talk to her commercial colleagues as well as HR. Trying to understand what people thought about HR was crucial. Her first challenge was persuading the Scandinavian company of how its plans needed to be adapted for Latin America. Setting up working groups that met three times a year over two or three days was instrumental in building the trust that was required to bring about the desired changes. Working with the commercial managers proved to be key to a successful formula.

This was a fascinating case study which revealed the nuances of accommodating differing regional and business cultures as companies shape their global management solutions. There will undoubtedly be huge value in sharing similar experiences across the global mobility community in the Latin America region. Download your free copy at relocateglobal.com

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LATIN AMERICA

Latin America’s take on

GLOBAL MOBILITY

Peggy Smith, Worldwide ERC’s president and CEO, led the Global Thought Leaders’ Dialogue at the Talent Mobility in Latin America Summit held in Sao Paulo in early September. Fiona Murchie was there.

mong the panel were Almiro Neto, president of ABRH-SP, the Brazilian HR association, Laura Pastiva-Santos, head of global mobility at Bunge, the US-based agribusiness and food ingredient company, and Martin Murray, mobility coordinator of WorleyParsons, the global engineering service provider based in Sao Paulo. Laura Pastiva-Santos spoke about Bunge’s diverse agribusiness, which had 80 assignees on long-term or short-term assignments, internships and rotations, who operated across a very decentralised platform, moving a range of disciplines, from technicians and agri specialists to commodity traders. Ms Pastiva-Santos acknowledged the need for sending country and receiving company to speak more and the desire for a little more standardisation. Bunge’s focus on talent management, she said, was supported by a CEO who wanted employees to embrace international experience.

Talking trends Trends in mobility over the last 12 months, and looking forward to the next three years, were perceived by panel members as follows. Almiro Neto reflected that, following the election in Brazil, things might change, and that going global was inevitable for many locally based companies. The ABRHSP was looking to bring in more international knowledge, especially in the area of immigration, and the hope was that the next government would facilitate more business abroad. Martin Murray echoed the familiar challenges of shortages in engineering and the problem of bringing talent from Venezuela, Bolivia and Australia. He wanted

to see the movement of people happening more quickly and easily – not just now but in coming years. Preparation times were getting shorter, visas were hard to obtain, and competition in the engineering field was getting ever tougher. The need not only to bring in talent but also to train Brazilians as global players and exploit their internal talent and fast track them as expats was already there, and a growing requirement. However, Mr Murray admitted that WorleyParsons didn’t look at mobility as a talent tool and wasn’t sufficiently aware of the investment in a person’s career. Sometimes, an assignment would end without due attention to the next role, which, in such a skills-shortage sector, was something that needed to be rectified. Laura Pastiva-Santos recounted how, two years ago, Bunge had formalised a head of talent. Now, there was greater interest in assignees, and the company was trying to ensure it didn’t lose talent and was sending the right people on assignment. She admitted that there was work to be done, and that it would take years to embed the new way of thinking. Currently, mobility doesn’t report to talent, but that is on the agenda for the future, in two to three years’ time.

Download your free copy at relocateglobal.com

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CONFERENCES

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Karen Bailey

Unpacking the big ideas

CHINA

BRAZIL

Anil Garg

This year’s crop of autumn conferences explored the overarching issues for global business, from how engagement can drive productivity to promoting the diversity agenda. Fiona Murchie explores the key themes that emerged from Worldwide ERC’s Global Workforce Symposium in Chicago, the CIPD’s Annual Conference in Manchester, and the CBI’s Annual Conference in London.

ovember’s CBI conference highlighted hot topics for companies making strategic business decisions as 2015 approaches. Many of its strands, including engagement, productivity and pay, dovetailed with those of the CIPD’s autumn conference. The CBI speaks on behalf of 190,000 businesses of all sizes, together employing nearly seven million people – about a third of the private-sector workforce. Part of its remit is to be the voice of British business, in the UK and around the world. The conference was strongly in favour of the UK staying within the EU.

UK creative industries: a success story Together, the creative industries are worth over 70 billion to the economy, and they continued to grow throughout the financial crisis. They generate further income by contributing to the culture and tourism industries. Ivan Dunleavy, chief executive of Pinewood Studios Group, provided a fascinating insight into the UK film industry, which is a stunning example of innovation, creativity and economic success. The industry includes not only performance and design but also software, and has a close relationship with TV and the video games industry (see p22). Featuring a film clip and a walk-on role by R2D, the character from the StarWars movies, Mr Dunleavy’s presentation was memorable and power-packed, reinforcing the value of the creative sector to the UK economy.

There are now 250 small companies based at Pinewood, providing a raft of specialist services not only to Pinewood but also to other studios and industry sectors, from fashion to video games. The UK’s film sector leads the world, exporting to the USA and Europe. New demand is coming from China. But there are skills shortages already, and Ivan Dunleavy called for more government support to fill skills gaps and provide training in practical business skills. Like the CIPD, the CBI is aware of the huge numbers of medium-sized companies, in a range of sectors, that could be expanding into overseas markets. The conference highlighted some excellent examples, with speakers including Angus Thirlwell, of Hotel Chocolat, and Jacqui Miller, of engineering firm Miller international. In the Spring 2015 issue of Re:locate magazine, we will examine these more closely, looking at the relationship between export as a business driver and the role of HR and global mobility in supporting business growth. We will also consider productivity and the part HR plays in championing the values of organisations, and explore the role of further and higher education in shaping the mobile workforce of the future.

CIPD conference: focus on HR solutions Befitting its mission to unlock new HR solutions, the CIPD’s annual conference in November emphasised employee engagement as the most effective way of boosting productivity and with it ROI.

Global Workforce Summit: Talent Mobility in EMEA Lancaster London Hotel London, UK

Global Workforce Summit: Talent Mobility in APAC Pudong Shangri La Hotel Shanghai, China

Global Workforce Summit: Talent Mobility in LATAM Sheraton São Paulo WTC Hotel São Paulo, Brazil

February 11-12

March 26-27

September 9-10

2015

www.WorldwideERC.org/meetings

WHAT WILL YOU GAIN?

Up-to-the-minute information. An unmatched caliber of experienced speakers. Opportunities to engage in outstanding networking, benchmarking and additional professional development with Global Mobility Specialist (GMS®) and Strategic Talent Mobility (GMS-TTM) training. The confidence of knowing you’re benefitting from 50 years of trusted expertise and the high-quality, professional forums that only Worldwide ERC® can deliver. Join your global workforce mobility peers to explore risk management, traditional mobility policy alternatives, compliance, strategic planning and cost control, safety concerns and other key talent mobility challenges and solutions. Experience the latest products and innovations in our dedicated exhibition areas.

LEARN MORE AND REGISTER AT www.WorldwideERC.org/meetings Looking for new ways to connect with business partners and elevate your brand visibility? Ask us about sponsorship and exhibiting opportunities! Contact Glen Cox at gcox@worldwideerc.org, or +1 703 842 3426; or Alexandra McWilliams at amcwilliams@worldwideerc.org, or +1 703 842 3421.

continues on p50 48 | Re:locate | Winter 2014/15

relocatemagazine.com | 49

CIPD new markets director Alan Ovens joined Anil Garg, director of organisational development at Saudi Basic Industries Corporation, in a fascinating presentation called Engaging and Leading HR Internationally to Deliver Better Productivity, which reflected the CIPD’s new global perspective and reinforced HR’s role in challenging the status quo. Alan Ovens said, “As HR, we need to be more businesssavvy and think more commercially using analytics. We have to live and breathe return on investment, and this needs to be normal language for HR … It is not about soft and fluffy. “Employee engagement, nationally and internationally, is about return on investment, and employers creating a culture that engages the talent in a way that attracts and engages, develops and engages.” Such engagement is linked to higher levels of customer satisfaction and higher operating profit. Research also suggests that emotional (as opposed to rational) engagement has the biggest impact on driving discretionary effort in relation to the job, the organisation, the team and the manager.

Neuroscience to the fore Enabling people was also the focus when a group of panellists gathered to discuss the growing role of neuroscience in learning and development. On stage were Karen Bailey, head of competence development at Volvo, Jan Hills, partner and founder of leadership development consultancy Head Heart + Brain, and Beverley Aylott, head of leadership at Imperial College Healthcare NHS Trust. Ruth Stuart, research adviser for learning and development at the CIPD, took the chair. The discussion revolved around how this relatively young discipline could be applied to the needs of organisations. Jan Hills said, “Neuroscience tells us that people learn the most when they have the insight themselves. So we’ve made a big study into how you make that insight part of your learning programmes, rather than telling people what they need to change or what they should do.” An energising session by Stephanie Davies, of Laughology, a training and development company that works across business, education and health sectors, underlined the point. During 2015, Re:locate will be looking in more detail at how organisations can use neuroscience and happiness to get the best from their staff. We’ll also be highlighting the latest megatrends – those bigger-picture, overarching trends that are shaping global economies and the world of work.

Worldwide ERC looks to the future A record 1,700 delegates attended Worldwide ERC’s 50th anniversary symposium, held in Chicago in October. As the organisation celebrated this milestone and looked back on its achievements, the emphasis and message for the future

Re:1ocate

SECTION HEADING

CONFERENCES

were very much about the value of learning through each other, thinking globally and acting locally. There was an exceptional session on integrating talent mobility with talent management strategy. Excellent chemistry between the presenters, Susan Gregory, of Grant Thornton, May Caffi, of Marriott International, and Andrew Walker, of Worley Parsons, made for an entertaining and memorable session, with plenty of food for thought via case studies. Susan Gregory explained that mobility at Grant Thornton is very employee-driven. However, there is now a swing back to a more structured mobility programme, with signs that the responsibility is coming back to the employer. She explained that global mobility is talking to high-potentials and working with them to see what can be achieved together. May Caffi spoke of her experience of working under the talent umbrella, which had provided great synergy. Her recommendation was to do things gradually and take small steps. Andrew Walker, who had worked for a variety of organisations with different approaches, felt there was no magic formula to integrating mobility with talent, as it has to be customised for your organisation. It is vital to have credibility and to make sure your transactions and processes are in order before you take on talent. It is important to stop talking about mobility as a cost centre and start talking about the millions spent as an investment. That way, you can change the profile of your mobility programme.

Promoting the diversity agenda A conference highlight was the presentation by Mark Daniels, of GuideWire Software, and Dean Foster, of DFA, on teamwork and communication challenges in multigenerational and multicultural teams. With the chance for interaction with fellow delegates, this lively session drove home the value of cultural awareness. We will explore this more fully in our Spring 2015 issue. Another fascinating session was entitled What it’s Really Like at the Other Side of the Rainbow. Cathryn Oakley, a US lawyer and human rights campaigner, and Robert Brezosky and Antonella Miscio, of the Walt Disney Company, examined the impact of anti-discrimination laws on mobility and how companies provide for civil partnership and same-sex married couples under their relocation policy, with practical advice on supporting same-sex couples on international assignment. We will revisit this topic and wider diversity issues in 2015. From doing business in Africa to the rise of Chinese multinationals and Brazil in the global spotlight, with practical advice on many aspects of immigration, there are plenty of insights to be covered in 2015, not least the implications of big data for the mobility industry.

Years

To celebrate our tenth anniversary, we are introducing some exciting innovations to support you in the work you do across global mobility.

Editor’s Breakfasts A series designed to focus on different market sectors, from meeting the buyers to cross-fertilisation across disciplines, tackling challenging agendas, debating the issues of the future, informing governments, and driving change. This is an opportunity to have your say and help shape the relocation and global mobility agenda.

Video & Webinar Interview Series Latin America

Asia Pacific

Understanding the value chain

Coping with property hotspots

Neuroscience: the key to

International school places

Oil, gas and energy

Skills shortages and the talent mix

Aerospace industry

The great global immigration

debate

Africa

engagement

Serviced apartments – unlocking the future

Eldercare on the agenda to en

High-impact supp enterprise, high-flort – entrepreneurs, yers and growth International group mov best practice pays off es –

Technology and global mobility

Setting up in a new dominion

Minimising risk: global healthcare and security

Re:locate Awards series, November 2014–February 2015

Preparing for Digital Natives (Gen Z) Developing women leaders sure mobility

Events

Charity

king Evening International Networ d enjoy a taste of Make new connections an al capital. 11 February London, the UK’s magic

Support our Gift of Time initiatives, in cluding the Silver Line, Mag pie Dance and the Women ’s Interlin k Foundatio n, with fun a ctivities and network ing.

For further details, see our website and Re:locate Extra.

50 | Re:locate | Winter 2014/15

Contact Annabel Letham at annabel@relocatemagazine.com or on +44 (0)1892 891334 about sponsorship opportunities throughout our anniversary year.

relocateglobal.com relocateglobal.com || 51 51

NEWS&ANALYSIS London ‘most expensive f city for staf relocation’

panies e city for com ost expensiv m e th Hong w ng no ki s, overta London is ate employee od m m years, e co fiv ac seeking to for the past the top spot ld he s ha Kong, which ser Savills. property advi according to the p four, in which mplete the to co ris e top Pa ac d sp an e New York ntial and offic de si re g in nt sts of re combined co r year. employee pe r $100,000 pe lls Live/Work ated the Savi in m do ve of ha ties lative stability These four ci flecting the re re , 08 20 e in launch e matur arkets of mor Index since its commercial m d an l ia ntly nt ce de re both the resi d with more urn compare nt ow -d st po global cities s. ee of renting emerged citie sts per employ co l ta to e th sures on, The index mea r basis in Lond on a US-dolla e ac sp w, co ng ki os apore, M living and wor ris, Tokyo, Sing Pa , rk Yo ew N Hong Kong, and Mumbai. Shanghai, Rio , ai ub D , ey Sydn

Keep up with daily news on relocateglobal.com

greatest mobility challenges

most business-friendly place’ For the ninth year in a row, Singapore has been rated as having the most business-friendly environment in the world, according to the World Bank Group’s Doing Business 2015 rankings. Using such yardsticks as the time it takes to establish a business and gain permits and the simplicity of the tax system, the report said that all the nations ranked in the top 20 had continued to improve their business regulatory environment. Improvements in the UK’s regulatory regime saw the nation rise one spot to eighth place on the list, while the US stayed in seventh position. Overall, New Zealand was ranked second behind Singapore, with Hong Kong in third place. Denmark, the Republic of Korea, Norway, Finland and Australia made up the rest of the top ten. The report found that the ten economies that had improved the most over the past year were Tajikistan, Benin, Togo, Côte d’Ivoire, Senegal, Trinidad and Tobago, the Democratic Republic of Congo, Azerbaijan, Ireland and the United Arab Emirates.

LIFTING THE LID A new guide designed to help companies get the most out of interim managers draws on the advice of some of the UK’s most successful interim managers and seasoned interim users.

he or she and the people around them

The experts’ tips span topics from objectives setting, empowering the interim and reporting through to ensuring the ‘fit’ is right and knowing when it’s time to let the interim go.

like a consultant. An interim should get

A major benefit of deploying an interim manager is the speed with which they can transform an organisation. William Offen, group interim manager at deVere Group, advises that, while this is a huge benefit, companies need to be prepared for the change that follows.

Recruitment, which publishes the guide,

“It is easy for a client to dream about higher performance and profits,” says Mr Offen, “but does the client understand that

turnarounds, accelerate plans, strengthen

He also warns organisations against confusing interims with consultants.

totally involved in the project and should be active and instrumental in the results. They’re not there to simply advise!” Norrie Johnston, of Norrie Johnston explains why he felt it was needed. “Having placed hundreds of senior interim managers over the years, I have seen first hand the incredible impact a carefully chosen, senior interim can have on a business. I’ve seen them deliver major

worldwide, asked international mobility managers to evaluate regional challenges and rank Global relocation service provider Cartus’s newly published annual study into the toughest challenges for international mobility managers reports that cost control, housing and compliance remain the top three concerns. Respondents considered Greater China the most challenging global region with respect to controlling costs, followed by Africa and Central/South America, which tied for second place. The Middle East took third place.

by degree of severity the issues specific to each region. It found that many of the issues affected not only the company’s relocation managers but also the daily lives and job success of their employees. By assignment type, tax compliance created the biggest problems for international mobility managers and their assignees on commuter and extended business-travel arrangements. To address this, 64 per cent reported that they were putting greater focus on better

three-year UK government contract

may have to work harder or differently?”

“Don’t treat the interim, or let them act,

The survey, which focused on challenges in 11 regions

HEALIX AWARDED

Using interim managers:

52 | Re:locate | Winter 2014/15

Survey identifies

Singapore ‘still world’s

temporary injection of experience or expertise, and so on. “Knowing what they’re capable of, I just can’t bear it when companies get this kind of recruitment wrong. So I thought it would be great to create a blueprint for getting the most out of this incredible type of talent by asking the people who know best – interims working at the coalface and those who have used interims – to share their experiences.” Getting the Most out of An Interim

project teams at a critical time, provide

Manager is downloadable free from

an organisation with a much-needed

www.NorrieJohnstonRecruitment.com

Healthcare services provider Healix International has been awarded a three-year contract to continue providing managed healthcare services for UK government employees working or travelling overseas. The contract includes an option for the government to extend the contract for a further two years. Having secured the original contract in 2010, Healix will now continue to provide government employees and their dependants with access to a full range of occupational health services and both primary and secondary healthcare services while overseas until at least 2018. The new contract is bigger than the original one, with the number of individuals covered increasing from around 14,500 to around 23,000 across 14 different government departments, including the Foreign & Commonwealth Office, the Home Office, the Ministry of Defence, the Cabinet Office, and the Department for International Development.

internal tracking of assignees’ days in country. Immigration and visas also continued to be challenging, with more respondents reporting that the process was requiring increased upfront planning. North America remained the region most critical to future business success. Greater China retained its 2013 secondplace ranking, followed by Europe and Central/South America. North America again saw the biggest increase in relocation volume, with 53 per cent of respondents ranking it first this year. Europe moved into second place, changing places with Greater China.

Decline of the traditional expat programme

Organisations are creatin g new programmes designed to align with the objectives and future needs of the businesses they serve. This means we’re seeing a decline in the traditional expat programmes, says Peter Sewell, regional director, Crown World Mo bility. Such changes in the pro grammes associated with long-term assignme nts are driven by evolving corporate strategic goals. Assignments are increasing in high-growth markets tha t are often based in more challenging locations. Linking to larger talent ma nagement strategies ens ures that assignments are targeted and critical in purpose. The effective ma nagement of assignments ensures that the right peo ple with the right skills are available to support the business, whilst on ass ignment and as part of the assignee’s ongoing development. The decline in traditional expat programmes reflect s the talent agenda. One size does not fit all; depend ing on the needs of the bus iness, the percentage of experienced hands versus those being developed to sup port current and future needs will vary immensely. www.crownworldmob ility.com

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SUPPORTING VIPS

TOUGH AT THE TOP Supporting the movers and shakers who are driving the recovery

In the first of our series looking at how to support VIPs on the move, whether they are CEOs, entrepreneurs, High Net Worth Individuals, financiers or leaders in their particular field, Fiona Murchie explores what can make the difference to the success of a high-level business trip, special project, or short- or long-term assignment.

54 | Re:locate | Winter 2014/15

View from Cheval Three Quays

lobally, the number of super rich, or High Net Worth Individuals (HNWIs), has reached 13.7 million, according to a Capgemini and RBC Wealth Management report published in June. HNWIs are defined as those with investable assets of at least $1 million (£590,000), not including their main home. The US, Japan, Germany and China have 60 per cent of the world’s population of HNWIs, but the United Arab Emirates and Ireland created the most new ones in 2014. The biggest growth has come from Asia Pacific, which is set to overtake the US in 2015. In Britain, 62,000 people became HNWIs during 2014, bringing the country’s total to 527,000. It was reported over the summer that London had beaten Tokyo and New York as the millionaire capital of the world, with 400,000 resident dollar millionaires. These various assessments of wealth prove that, whether you are in HR or on the talent management side, or a global mobility or compensation and benefits specialist, the chances are that you will be responsible for supporting senior people of many different nationalities who are jetting to the UK, and to London in particular. An eminent scientist may have different requirements from a financier, and a female CEO may have a different set of priorities regarding location or accommodation. It pays to be prepared. We will cover cross-cultural issues in a later part of the series, but here are some of the initial areas to explore when it is essential to provide a high-touch approach.

View from the top Serviced apartments are perfect for accommodating senior executives for a business trip of a few weeks or a longer period. Flexibility, security, high-quality service and amenities that can extend to the five-star-plus standard are just some of the reasons that HR and relocation professionals return again and again to book through their favourite providers, such as Oakwood and BridgeStreet, which offer the full range. However, it is perhaps not widely known that some really high-end apartments can be found in very convenient locations that are ideal for busy executives and their families, with more flexibility than you might imagine around booking and length of stay. If you are in HR, you need to be confident that high-quality accommodation is available when you need it, that the service will be spot on, and that you are receiving value for your organisation. I was, therefore, impressed to learn that serviced apartment providers can conjure Cheval Three Quays up a very special property in a spectacular

View from Cheval Calico House

location that fits the bill, with enough space for the family to come too, and terms that make good business sense. The Cheval Calico House penthouses are a perfect example. They provide the ultimate in convenience for work in the City and a spectacular view of St Paul’s. It is hard to imagine that a family could be housed in such a central location in a home offering an outdoor terrace, maid service, plenty of space, friendly staff, and security. Minimum booking is for 90 days, but apartments are typically booked for a year. Other sizes of apartment are also available. The new Cheval Three Quays apartments overlook the Tower of London and the Thames. Their luxurious penthouse suites, with balconies and views across the London skyline, certainly have the wow factor, and provide easy access to business districts, nightlife and culture. With accommodation ranging from studios to one- and twobedroomed apartments, and short-stay options available, Three Quays will also tick the box for corporate buyers hungry for the right location, no matter what level the executive. Find out in our Spring 2015 issue how to find the perfect property for senior executives to rent or purchase.

Seamless home technology Data security is a must for all business users, who need ready access to their business files via home-based devices as well as in the office. Consider it Done is a relocation concierge specialising in setting up easy-to-understand home technology for VIP assignees moving to the UK. As managing director Sue Reeve puts it, “We provide friendly answers to all the tricky bits. In the last 18 months, we have seen a change in people’s expectations. As soon as a family arrives in London, the teenagers Facetime their friends back home, and need the internet for their homework. The executive

relocateglobal.com | 55

PROPERTY

SUPPORTING VIPS

assignee needs a secure home-to-office connection and to be able to video-conference with colleagues overseas. “The whole household has multiple mobile devices being used to stream music, download files, and play games wirelessly. We find families from the US, in particular, expect home-from-home capabilities, and can be caught out if things aren’t straightforward when they arrive.” As the Highly Commended runner-up in the Technological Innovation in Relocation category of the Re:locate Awards 2013/14, Consider it Done was praised by the judges for combining the personal touch with technology through its Home Tech Genius service, which cuts through the complexity of integrating home technology. The service begins with a one-to-one consultation with the assignee family, wherever they are in the world, via a nifty piece of web video software called i-Contact. From there, the team carry out a survey of the new home, and then agree with the assignee the best combination of home technologies and equipment. Installation takes place ahead of the family’s arrival. This is primarily a concierge service for senior executives, but the potential for extending it to a wider expatriate population is enormous, and in progress.

The family came too In the case of accompanied assignees, providing the right support for family members is crucial. A case study from Heather Mulkey, marketing and admissions officer at the International School of London (ISL) Group, shows how her organisation supports not just school-aged children but the wider family as well. Says Ms Mulkey, “A Spanish family joined the school just over three years ago. Mr D, the transferring employee, is starting up a new division, and Mrs D, a lawyer, is at home with their three young children. “When Mr D came for the initial visit, his wife, who had just given birth to the youngest child, remained in Spain with the family, so it was up to him to find the school and home.

56 | Re:locate | Winter 2014/15

“The family arrived during the summer. Mr D was already working in the UK, and Mrs D was at home. Her relocation agent was helpful, but didn’t speak Spanish, so she felt a bit lost. At the beginning, the only communication was via miming and sign language. “Mrs D was greatly relieved by preliminary contacts from the school in Spanish, as well as the summer picnics, which gave her family a chance to visit the school and meet some of the returning families. By the time her children started, they had a feeling for the school, had made some friends, and knew the layout of the building, all of which had been reinforced at the pre-start-of-school orientation day. “Mrs D took advantage of our English as an Additional Language (EAL) classes to learn English and meet people, and the family participated in many social events. The oldest child was an excellent football player, so the school’s Crossroads Transition Team found a coach in the local community.” Before long, says Ms Mulkey, Mrs D became the Spanish community ‘buddy parent’ and was very involved in the life of the school. Of course, when such values are embedded in the ethos of a school, it doesn’t matter how influential the parents, the support for the child and the family members will be the same. In our Spring 2015 issue, we look at selecting schools and the role of education consultants and tutors.

Last word As companies and organisations seek more alliances with international partners, it pays to know how to meet the needs of the most demanding global players. In the next part of this series, we’ll be looking at the importance of fast-tracking immigration, ensuring access to first-class healthcare, and finding the right property search support. To ensure your international high-flyers have their financial affairs in good order, see page 20.

PROPERTY

What’s in store for 2015? It’s true to say that, whatever the state of the housing market, there will always be challenges for those seeking to buy a property. Currently, one of the greatest facing relocating employees in some areas is a lack of supply, which, in turn, is pushing up prices, as we report.

roperty analytics company Hometrack’s latest UK Cities House Price Index reveals that the top 20 cities nationwide are all registering annual house-price growth of 5 per cent or more for the first time in a decade, as pent-up demand has fed back into the market, supported by low mortgage rates and an upturn in the economy. This is more than three times the current growth in average earnings. However, the upward momentum appears to be slowing, with growth in the last quarter almost half that seen in the spring. Of the 20 cities surveyed, 14 are now registering house-price inflation below the UK average, and 13 are seeing a slowing in growth, compared with ten the previous month. The three cities with the highest price growth year on year are London (17.3 per cent), Bristol (13.2 per cent) and Cambridge (12.2 per cent), although momentum in these markets is slowing. The lowest growth was recorded in Glasgow and Liverpool (both 5.5 per cent), but these cities are continuing to see accelerating rates of growth, albeit off a low base. Hometrack’s analysis shows that 11 cities have an average house price below the UK average, with Liverpool and Glasgow prices 41 per cent lower. London bucks the trend. Its average house price is more than double the UK average, illustrating how the capital distorts the national picture. Edinburgh and Glasgow have seen a post-referendum bounce as confidence improves, with average prices up 4.1

per cent and 2.2 per cent respectively in the last quarter. The market in Aberdeen is being affected by a weak oil price, with house prices declining off a high base. Oxford and Cambridge have seen average prices come off the boil in the last three months (-1.2 per cent and -2.3 per cent respectively). They are starting to fall after gains of 42 per cent and 52 per cent in the last four years, as these smaller cities see pricing levels respond more quickly to weaker demand. Richard Donnell, research director at Hometrack, says, “Whilst mortgage rates remain low, new mortgage affordability tests and loan-to-income caps are impacting on the ability of marginal buyers to access the market, especially in the higher-value markets, such as London. On top of this, concerns over the impact of the global economy on the UK’s economic outlook are likely to come more to the fore. “Despite the economic uncertainty, the slowdown in the UK housing market will be welcome news for policymakers who want to avoid a debt-fuelled acceleration in house prices supported by record low mortgage rates. We expect the rate of house-price growth to slow further in the run-up to the year-end. “However, there are still bright spots of activity amid reports of a wider national slowdown. For the first time since the financial crisis, an improved economic outlook has seen house prices in cities outside the south of England

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EXTENDED STAY ADVERTORIAL

PROPERTY

rising off a low base. By the end of the year, we could well see monthly house-price growth in London slipping below that of some of major cities outside the South East.”

Looking into 2015 Martin Ellis, Halifax’s housing economist, predicts a better balance of supply and demand during 2015, leading to further moderation in price growth. Says Mr Ellis, “The prospect of higher interest rates at some point in the year and reduced affordability are expected to be key factors curbing housing demand. A looming general election next May could also raise uncertainty, resulting in a lull in activity in the early months of the year.” Despite these downward pressures, Martin Ellis believes, housing demand will be supported by continuing economic recovery, growth in employment and continuing low mortgage rates. Average earnings also appear set to rise more quickly than inflation next year, with the first gain in ‘real’ earnings for several years stimulating demand for property. Overall, he expects house prices nationally to increase in a range of 3 to 5 per cent during 2015. “Outside the South East and London,” adds Mr Ellis, “house prices do not appear markedly out of line with fundamentals. We, therefore, expect to see a more even regional pattern in house-price growth during 2015.”

Serviced accommodation sector expanding According to ASAP, the trade association for the UK serviced apartment sector, more than 1,400 new serviced apartments have come to the UK market in 2014, a 10 per cent increase on 2013. With demand for its product outstripping supply, particularly in London, the serviced apartment sector appears to be flourishing. ASAP already has 80 members, and managing director James Foice has set his sights on more than doubling that figure over the next 18 months. Members range from large international companies to small independent operators, and include both providers and a growing number of booking agencies. This is not an insignificant sector. Serviced accommodation generates £500 million in annual revenue and sells three million accommodation nights each year. In terms of jobs, it employs thousands of people, with staffing costs in the region of £70 million. Don James has just been elected deputy chairman of ASAP, and will take over as chairman next year. With a career that spans retail, information technology, hospitality and the leisure industry, and experience with Marks & Spencer and as a consultant in Sub-Saharan Africa, Mr James seems to have all the ingredients it takes to push the organisation forward to meet the challenges of a global marketplace. ASAP’s recent conference included sessions on tailoring the serviced apartment offering to the needs of overseas visitors from China and the Middle East. Seen as the

58 | Re:locate | Winter 2014/15

bastion of quality, the association is rolling out its quality assessment (QA) programme in the UK, and making overtures internationally in the US and Europe. It is also taking on a lobbying role, keen to make its views heard in Westminster and Whitehall. James Foice spoke recently on reforms to short-term letting. “It’s clear that political imperatives are driving government action, most especially the need for more housing in London.” Mr Foice cited the ASAP quality assessment initiative as a means of ensuring that customers know exactly what they are buying. “One potential risk of deregulation is that customers cannot guarantee that they’ll get what they see on a website, not just facilities and furniture, but also health and safety and insurance. Our QA initiative provides the protection customers require when they book a serviced apartment.” ASAP appears to be embracing change, which bodes well for those involved in managing relocation and international assignments. Experienced global mobility managers have long appreciated the quality and compliance standards upheld by their preferred serviced apartment brands, in the UK, in Europe, and, further afield, in Asia and beyond. However, in this burgeoning market it is essential to know exactly what you are booking, and the more ASAP can influence the quality, safety and security of new providers to the market, the better.

UK regional provision improving Serviced apartments are no longer just to be found in popular UK locations, but there is still not enough regional provision to support British business and economic growth. There is much to be done to spread the serviced apartment offering out into the regions. As relocation hotspots take off (see our Ashford feature on p6), there will be a need for all levels of accommodation serving project works for infrastructure and energy projects. For example, rail projects HS2 and HS3 will throw up demand along their routes, as will whichever airport expansion scheme is chosen. Fracking and shale gas exploration are other potential drivers of the need for short-term accommodation, though perhaps not in the form in which we know it. As the economy picks up, driving business in our towns and cities, so comes the opportunity for the serviced apartment industry to respond. Relocation hotspots are not just clustered in major cities like Manchester, Birmingham, Aberdeen and Edinburgh, but are growing in response to economic needs in areas like Taunton, in Somerset, supporting the massive redevelopment of the Hinkely Point nuclear power station. The story is the same overseas, where expansion in Asia includes accommodation in Tier 5 and Tier 6 cities for engineers and project teams. Even Africa is not off the cards for the big global providers, who can’t afford to say no to their multinational corporate clients.

FLEXIBLE

ACCOMMODATION

HITS THE SPOT

Time-pressed HR and relocation professionals will welcome the homeaway-from-home accommodation Staybridge Suites® offers relocating employees and business travellers.

s London continues to grow as a hive of activity for international business, it is good news for business travellers and those managing international assignments that Staybridge Suites, the extended stay brand by InterContinental Hotels Group (IHG®), will soon open a new property on Vauxhall‘s up-and-coming Albert Embankment. The new property is perfectly positioned to serve South London, with easy access to tube, bus and rail links. Stunning views of the Palace of Westminster and the London Eye add to the appeal, and the South Bank is just a short stroll away. This is the fifth aparthotel that Staybridge Suites has opened in the UK since 2008, joining Staybridge Suites London – Stratford City, which opened in time for the London 2014 Olympics, and Staybridge Suites properties in Birmingham, Liverpool and Newcastle-upon-Tyne. Designed specifically for the extended stay market, Staybridge Suites offers the option of combining the security of a familiar brand with home comforts and thoughtful touches that make longer stays more enjoyable. Accommodation at Staybridge Suites offers spacious studios and one- or two-bedroomed suites, equipped with their own kitchens. Guests can enjoy free wi-fi, free hot breakfasts, 24/7 access to the fitness room and a laundry room. For the business user, convenience goes hand in hand with the comforts of home. That feeling of belonging and

doing what you please, when you please, is something that is highly valued by relocation users, as the HR departments and relocation companies or destination service providers making the bookings are well aware. They know that employees need to be settled and comfortable to take on a busy work schedule and the demands of the job, whether they have flown from New York or driven from Sheffield. Other unique features include The Social, where guests gather for drinks and eats three times a week, the Living Room, which provides a friendly space to relax and work in, and The Pantry, where guests can shop for basic food items. All of these let guests relax, work and socialise in a homely environment. The appeal of extended stay apartments to business travellers is entirely understandable: they are spacious, provide a residential, homely setting and give guests the freedom to organise their time as they like. Staybridge Suites provides the best of both worlds, offering the services and convenience of a hotel with a welcoming setting that allows guests to settle in comfortably and make themselves at home.

For more information, please visit www.staybridgesuites.com

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EDUCATION

The new global

CLASSROOM It is predicted that within five years there will be more than five million students studying in international schools. As international school groups continue to grow and expand, so do their ambitions to communicate across borders and take advantage of their inherent cultural diversity and opportunities for global student collaboration. Rebecca Marriage looks at some of the innovations that are emerging from the global network of international schools and what they mean for future generations of globally mobile professionals.

or relocating parents, international schools are often a first choice when selecting a school for their child overseas. International schools offer a wide variety of curriculum and learning options, from a British National curriculum to an American K-12 programme to an internationally transferable programme of learning such as the International Baccalaureate (IB).

Over the last few years, international schools have also been taking advantage of their global reach, and have developed a number of exciting innovations to encourage students to collaborate and learn alongside their peers from around the world, both in virtual environments and face to face. continues on p62

60 | Re:locate | Winter 2014/15

EDUCATION

For the past five years, the IB has been offering its Diploma Programme (IBDP) students a range of online subject courses, all delivered by UK-based online course provider Pamoja Education. Students in participating schools can choose to take one or more of their IBDP subjects in a virtual classroom for the entire two-year period of study. They learn in classes of between 15 and 25 students, working alongside online classmates who are based in other schools around the world. They are taught by qualified, experienced IB subject teachers who have been trained in online teaching. Students engage in live online lessons with their teacher and classmates, and conduct weekly assignments that include online discussions and blog entries.

Classrooms without walls In Japan, students at Yokohama International School have been learning online for four years. Head of academics at the school Dennis Stanworth says, “It gives our students an opportunity to study outside the classroom, where the classroom walls are non-existent and the context is truly global. This chance to learn together with other students across the world gives them global awareness and connectivity that are perhaps less common in the traditional classroom.” The benefits of online leaning in a global environment have been backed up by recent research by the Institute of Education (IOE) which has found that studying online

with a group and teachers from unfamiliar cultures and environments contributes to learners’ readiness for university. Hollie Smith, a former student of St Benedict’s Catholic School, in Alcester, England, studied Psychology online for two years as part of her IBDP. She is now reading Psychology with American Studies at the University of Sussex. “I had 20 classmates in my online class,” says Hollie. “They were from all over the world, including Namibia, New York, Brazil and Copenhagen. Particularly for my subject, this was really valuable, as it gave such a different cultural point of view. In Psychology, you cover some quite ethical issues, and it was fascinating to hear the different perspectives because of their cultural influences. It really opened my mind to the fact that different cultures see the world in different ways; there’s not just one right way. I think that has helped me. “One of the topics in the first term of my degree was about individuals and groups and how different cultures can learn from each other. I was able to draw so much from my online IB class for that.” Hollie says that learning in groups in the online classroom taught her skills that will be valuable throughout university and in the workplace. “That experience was incredibly beneficial,” she says. “It had its challenges, too. In one of the groups, some people were up to six hours ahead of or behind British Standard Time, and so you had to learn to be adaptable with your group sessions, to make sure you could fit in with everyone’s different time zones.”

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Global collaboration Mac Gamse, CEO of the Meritas Family of Schools, which has schools in the US, Europe and Asia, believes that international collaboration with fellow students is a vital part of today’s school environment. “With the challenges that are facing our world today,” he says, “it’s critical that our students are working with their peers from around the world.” Kim Eklund, Meritas’s director of global enrolment, explains how her organisation is helping students with these global interactions. “The world we live in is constantly changing – the way we communicate, the way we consume news – and that holds especially true in the way we educate students,” she says. “The Meritas Family of Schools has internationally connected classrooms and campuses in the Americas, Asia and Europe that feature innovative global experiences and provide opportunities for students at all levels within the schools to meet and interact with one another.” In the classroom, beginning in the second grade, Meritas students receive an introduction to global collaboration and problem-solving through what is known as the Touchpoints programme. Touchpoints is a learning programme for students in Grades 2–8 that allows them to interact with others from Meritas schools around the world. Together, they research a globally significant problem and generate potential solutions. Students, working with their teacher’s guidance, conduct a

year-long, in-depth study of topics ranging from deforestation to the effects of poverty on education. They communicate with their research partners by posting their questions, findings, solutions and ideas on a shared Wiki site. A highlight of the year, says Kim Eklund, is a videoconferencing debate between the paired classes on a proposed resolution to the global dilemma they are studying. “Students develop a global understanding while also learning how to work with other students to find solutions to complex problems.”

Working with diverse teams Collaborative problem-solving is rising up the agenda for international educators across the globe. It will form part of the Organisation for Economic Co-operation and Development’s (OECD) international education performance assessment framework from 2015. “Much of the problem-solving work carried out in the world today is performed by teams in an increasingly global and computerised economy,” the OECD states in its education assessment framework. “Moreover, with greater availability of networked computers, individuals are increasingly expected to work with diverse teams spread across different locations.” The International School of London (ISL) Qatar, part of the ISL group, which also has schools in Surrey and London, understands the importance of global collaboration and cross-cultural problem-solving. This is why, as well as

EDUCATION

participating in the IB Online programme, it was selected as a regional host of the World Scholar’s Cup earlier this year. The Cup is a prestigious academic competition which celebrates critical thinking over a variety of disciplines. “Through this event, students explore, research and debate global issues, whilst developing public-speaking, teamwork and problem-solving skills,” said head of school Chris Charleson. “The goals of the World Scholar’s Cup are in line with ISL’s vision of empowering students to maximise their learning opportunities and fulfil their potential.”

In his opening speech, the British Council’s chief executive, Sir Martin Davidson, described the new global landscape. “Urbanisation plus digital communications plus education is a combination that is as revolutionary as railways and the new industrial manufacturing techniques of the 19th century. Suddenly, your hard-won skills have value, because you are within reach of jobs and potential customers on the other side of the world. But you are also in competition with the best talent in the world.” The leading international schools have recognised this and are already tapped into the world of global mobility. “This is an increasingly borderless world, and you have to be willing to learn and be prepared for these global interactions,” says Kim Eklund. “Parents recognise this and gravitate towards us, confident that we’re giving our students the opportunity to learn, interact and prepare for these global changes day in and day out.”

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example, the very good and the outstanding student. But it is the intangible qualities within the IB Diploma, those that cannot be measured or clearly identified, which, arguably, are the most valuable. So valuable, in fact, that some universities have been bold enough to state publicly their preference for IB Diploma applicants.

Southbank International Baccalaureate Diploma: A ticket to a top university?

While some schools may have established their reputation by teaching their students to pass exams, those offering the IB Diploma have no option but to educate them, in the widest sense of the term. The diploma is more than a qualification, it is an educational programme, underpinned by a philosophy enshrined in the IB’s mission statement and Learner Profile. If you choose to approach the IB Diploma from a pragmatic, even commercial, perspective, it should be identified as offering a gold card to university entrance.

Research suggests that proportionately more International Baccalaureate (IB) Diploma applicants receive conditional offers of places at top UK universities than their peers applying with other qualifications. Analysis of the content of IB Diploma courses identifies an academic rigour missing from equivalent university entry qualifications. The currency of IB Diploma grades has not been devalued by the phenomenon of ‘grade inflation’, which has debased the coinage of many countries’ qualifications systems. Grade inflation aside, the IB assessment system is finely calibrated, so it can discriminate effectively between, for

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IB Diploma Scholarship 2015-2017 We are pleased to announce that we now accept applications for our IB Diploma Programme Scholarship for September 2015 start • Southbank is one of the top 1% of schools in the UK • IBDP 2014 exam results: average 36 points, pass rate 100% • Our destination universities include Yale, Oxford and Cambridge • Engaged, well networked student body representing 70+ countries • Dedicated central London facilities for Diploma Programme students Application deadline: 16 January 2015 Selection interviews*: w/c 02 February 2015

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