Maggie Williams meets Andrew White, Head of Group Pensions UK and Ireland for Nestlé.
Nestlé’s pensions provision is both a slice of its corporate history and a powerful benefit for its current and future workforce. The global food and beverage group’s business growth, acquisitions, workforce changes and the ongoing regulatory evolution are all reflected in the complex structure of around 20 pensions arrangements in the UK and Ireland alone.
Andrew White, Head of Group Pensions UK and Ireland for Nestlé is responsible for the 39,000 pensions held in those arrangements, of which around 9,000 are current UK and Ireland employees. The schemes range from small defined contribution (DC) contract-based arrangements, to large defined benefit (DB) schemes including the Nestlé UK Pension Fund, which has around £6.5bn in liabilities and 35,000 members, of which c.18,000 are pensioners, 10,000 are deferred and 7,000 active members. It closed to new members in 2016 but remains open to future DB accrual. Nestlé launched a DC Section of the Nestlé UK Pension Fund in 2010, which now has around £160m in assets.
Nestlé’s schemes have “all sorts of subsections, guaranteed benefits and other complexities that are typical of companies of our scale,” says White. “The Nestlé UK Pension Fund goes back as far as 1948, but if you include arrangements from some of the companies we’ve acquired, you can add on a few more decades of history again.”
White has three main roles in taming these complexities and evolving Nestlé’s pension provision for the future. “Firstly, and on behalf of the sponsoring company, I lead negotiations with the trustees, all working within a super collaborative environment. If we are talking to employee representatives or our trade union colleagues, I’m also the pensions lead in those discussions, again from a sponsor perspective.”
He also runs Nestlé’s 50-strong in-house pensions administration team. “We provide administration services in different ways to our different funds, including a full service offering to the Nestlé UK Pension Fund,” he explains. “We have a formal contract in place between the company and the trustee board and I have a leading role in representing the Administrator in conversations with trustees.”
Alongside his UK-based role, White is chair of trustees for the Brussels based Nestlé European Pension Fund, looking after pension provision across several countries in Europe and the Middle East. “Nestlé is a great organisation to work for from a personal development perspective. I’ve learnt so much in the role, especially from working in European pensions.”
Looking to the future
The next chapter in the company’s pensions story is already well under way, and White is focused on digitalisation. “The pensions industry as a whole is going through a revolution, and at Nestlé we are in the early stages of a hugely important cultural and technological transformation.”
“We’re taking the opportunity to rethink how we position ourselves as a pensions team, the services that we offer, the connectivity that members have, and the technology that underpins all of that.”
The pensions transformation at Nestlé is about more than technology. “One of the proudest moments from my career has been the recent work we’ve been doing as a team to develop our vision. ”
“We have a purpose, which is to deliver ‘perfect pension moments’: this purpose starts by defining the experiences that an individual has when they're interacting with us. Whatever the interaction, we want members to be left with a positive emotional feeling. That means as a team we have to listen, deliver clarity and be empathetic to people’s individual circumstances.”
White adds that this purpose goes beyond member interactions. “We also apply the same thinking when we engage with our trustee boards, the adviser community and most importantly, with each other in the team. It gives us an almost philosophical basis for the future and for our ways of working. It’s far more than simply ‘pay the right pension to the right person at the right time’, which is what you’d expect pensions to be about, and is of course still critically important. It’s a different way to think about how to lead a team, provide great service and hopefully be a great place to work.”
White’s pensions career started with some unusual advice. “I play the bass trombone and in the last few years of my education, music was everything. A career adviser suggested that I apply for jobs at the BBC with the idea that, once I was through the door, I would be able to move around within the BBC and find a role within orchestral management.
“So, I joined the BBC’s pensions department in 1980…and the rest is history. I’ve stayed with pensions ever since. I was completely new to the industry and the BBC team put so much effort into helping me understand the subject. I’ve carried that with me and tried to implement the same sense of support in the teams that I look after.”
Following nine years at the BBC, White moved to British Aerospace. Along with extending his knowledge of administration and risk management, he also got his first opportunity to talk directly with members. “In the late 1980s and early 1990s, there were site closures, so I spent a lot of time counselling members and employees in person about their pensions.”
After an 18-month break to focus on writing, White returned to pensions with roles at Crown Financial Management, insurer Liverpool Victoria and publisher Newsquest, before joining Nestlé in 2008.
White’s role at Newsquest brought him face-to-face with members again, as he travelled to the company’s 34 UK locations to explain major benefit changes. “It’s tempting to think about pensions as being numbers, compliance, technology, complexity and investment. But what really drives me is the human component and interaction with people. My role at Newsquest was great experience from that point of view.”
In pensions more broadly, White sees some important challenges ahead. “I believe we are at a tipping point in developing a more trusted relationship between the pensions industry and members. Across my career, we’ve been on a roller-coaster ride from mis-selling scandals, through to scams, massive market volatility and now new innovative ways of communicating with members. All of these bring different challenges around building trust.”
White points to pensions dashboards as one example of that tipping point. “Dashboards are a colossal, but achievable challenge. Having pensions information all in one place should really help members and that’s a fantastic opportunity we need to grasp. But execution will be everything when it goes live to the public.
“As an industry we must all make sure it works properly, so that we avoid people having partial data matches or confusing pension figures all of which could lead to an avalanche of queries to the administrator. We need to understand how to handle the huge volume of requests from the dashboard ecosystem, get estimated retirement income calculations right, get the execution as near perfect as is possible, as well as focusing on the member experience: what will people do with the information from the dashboard, and what sort of behaviour will it generate?”
The big picture challenges of technology and trust in pensions, as well as evolving the purpose of the pensions team at Nestlé, are part of the variety that White relishes in his role. “The breadth of pensions is challenging and fulfilling. I might have started working in pensions by accident, but it has proved more fascinating, rewarding and demanding than I could ever have envisaged.”
The PLSA and me
One of the things I value most about PLSA membership is the library of resources. For example, the materials on pension dashboards are well constructed and clear – in the context of a very complicated subject.
The PLSA is also an important voice in bringing the industry’s thoughts and views together around policy change, especially as there is so much transformation happening at present.
Networking and finding out what other members are doing is also really important for me. We are all addressing similar issues in different ways and from different perspectives, so sharing experiences through the PLSA is really useful.