Helping B. Braun become an award winning pension scheme

At the 2023 Pension Age Awards, our client B. Braun was named “DC Pension Scheme of the Year”. Here is the inside story on how they achieved this honour.

Overview

B. Braun is one of the world's leading manufacturers of medical devices and pharmaceutical products and services. With over 66,000 employees in 64 countries, B. Braun develops high quality product systems and services for users around the world.

Their Pension Management Committee (PMC) provide active governance of the organisation’s DC pension scheme. In 2018, the PMC commissioned us to produce a detailed analysis of expected member outcomes at retirement to understand whether colleagues were saving enough and could afford to retire. 

Approach

The analysis revealed that nearly 66% of members remained at the default contribution level, likely not proactively evaluating whether this would meet their desired retirement outcome, and only a minority of members were on track to achieve their target outcome at retirement.

The PMC concluded that there was a real risk that employees would not be able to afford to retire, and felt that as a responsible employer, there was a need to act.

The PMC agreed that Pension Auto-escalation (PAE) could be a solution and presented their case to the Board supported by data; showing the projected outcomes, highlighting the risk to the business, and outlining how increased contributions could improve member outcomes and the long-term financial security of members, thereby mitigating the risk.

Whilst securing approval and funding for PAE was crucial (‘headroom’ between the default contribution level and the employer’s maximum contribution was 2%), successful member engagement was also required for the best chance of meeting the objectives.

Results

Once a solution was agreed upon, a communication plan was drawn up to make sure those most in need of help were made aware of the new initiative.

Though the launch communication was aimed at members who were paying at or below the default contribution, the powerful message travelled beyond this - members who were already contributing more than 5% wanted to ‘sign up’ for PAE to increase their contributions. This was a fantastic endorsement of the initiative and demonstrated that members valued PAE’s objectives.

Now, 97% of B. Braun's plan members are exceeding the minimum auto-enrolment contributions by at least 5%. Furthermore, 83% and 63% of B Braun’s low and medium affluence cohorts (respectively) are on track to meet their target outcome. This figure rises to 87% and 79% when considering the final contribution increase in 2023.

Following this successful initiative, B. Braun were nominated for, and subsequently won, the "DC Scheme of the Year" award at the Pensions Age Awards 2023. 

^{Receiving the award was Peter Griffiths (B Braun), Katy Hayes (BW) and Joanne Palmer (B Braun). The award was presented by Pensions Age Editor in Chief Francesca Fabriz (right) and host Suzi Ruffell (left).}

Can we help you?

We can offer a wide-range of governance support services for DC pension schemes, including strategic reviews similar to the one detailed above. If you think your team could benefit from our expertise, please get in touch.