Long-term employee benefits liabilities, such as Gratuity, Leave and Provident Funds have been clearly visible on balance sheets for a few years now. As liabilities grow and have an impact on profits, companies have had to ask themselves whether they are managing benefits effectively.
Whether through mandatory requirements or voluntarily, secure retirement benefits are going to be critical for an employee’s future. While often overlooked, most key business activities will have an effect on managing the retirement benefits - whether you are managing costs, managing risks or managing growth. Opportunities exist for operational and financial efficiencies, better risk controls, greater employee engagement and deeper knowledge for those who take on the responsibility of being Trustees.
With global governance initiatives filtering into India, now is the right time for Indian companies to proactively consider issues around retirement trust governance.
- Governance and management of retirement trusts is gaining importance
- Retirement management is likely to take up more management time
- Trustees would do well to get a better understanding of their roles and responsibilities