Business Continuity is a PROCESS, not to be viewed as a project with a start and end date. Did you know that only 25% of companies do not have a Business Continuity Plan and 60% have not considered how losing a supplier would impact their business? Retirement Readiness – it’s time to develop your strategy for the implementation of the ORPP!
Business Continuity Planning (BCP)
David Lindsay, Client Executive with Jones Brown Inc presented to us the following 4 related sections and the key elements of a BCP.
- Aligning Risk Management plans with Strategic an Organizational Objectives
- The Value of Business Continuity Planning as part of the Overall Risk Management Plan
- Getting Started. Critical Questions
- The Key Elements of a Business Continuity Plan
The top risks today are;
- Reputation - Think Lance Armstrong and Tiger Woods for Nikey or a Manufacturer Recall
- Regulatory – Product Standards
- Supply Chain – The Mississippi river drought prevented supply barges from entering
- Cyber/Data Security – preventing a breach in your system
- People/Skilled Labour
- Political – political risk insurance policies
- Weather “Extreme” – ice storm of 2013, floods in Calgary etc.
*Business Continuity is a Process! Creating a Business Continuity Plan is an on-going process and should be every evolving with an annual review or as process or equipment changes happen.
Key Elements of a Business Continuity Plan
- Initiate Business Continuity Planning – establish management support, identify team members etc
- Conduct Business Impact Analysis – measure the financial impact, consider income statement…
- Consider Recovery Capabilities – alternate location, suppliers or delivery methods, data back-up
- Implement and Test the Plan – document, communicate, train staff and test the plan
- Finance the Plan – the #1 reason the BC Plan fails – lack of funds. Carry insurance to protect and pay for people, property, payroll and customers & key suppliers.
Prepare, prepare, prepare! Plan for Business Continuity. Secure cash to pay for your BC Plan and Revisit your plan regularly.
ORPP: Ontario Retirement Pension Plan
David Wright, Sr. Vice President with APRI Insurance Services Inc. presented on ORPP.
The Ontario Governments key concerns regarding Retirement Readiness;
- Inadequate access to employer-sponsored savings plan
- Low personal savings rates
- Longer life expectancy
- Job hopping is the new norm
The Ontario employees most at risk are;
- Private sector employees earning $30-$100K
- Employees without access to employer-sponsored savings plans
The ORPP will
- Be mandatory for Ontario employers except for employers with a ‘comparable’ workplace pension plan in place.
- Requires 1.9% contribution from both employer and employees (proposed phase in of contributions) – earnings above $90,000 are exempt.
- Target income replacement rate of 15%
- Contributions will be locked-in to retirement age
The big question is “What plans qualify as ‘comparable’?
The answer is; 2 types of plans can be considered ‘comparable’ to ORPP and exempt the participation of employers and employees:
- Defined Benefit Pension Plan (DBPP)
- Defined Contribution Pension Plan (DCPP) If the DCPP provides for;
- Total employee and employer contributions of at least 8%
- Total employer contribution of at least 50% of the total contribution or at least 4%
Group RRSP and DPSP are not comparable plans no matter the level of employer and employee contribution rates. Comparability test for PRPPs will be created but no details are available yet.
Employers have the following options;
- Participate in ORPP and keep offering your current plan with or without changes to contributions or features
- Make necessary changes to current workplace plan to render it comparable and therefore exempt from ORPP
- No workplace savings plan in place, consider installing RPP to be ORPP exempt.
Consider the RPP Alternative because:
- “Employer of Choice” status is a strategic advantage
- RPPs provide tangible value to employers – attract and retain good employees and reduce turnover
- Strong link between employee financial wellbeing and health
For the full presentation on these topics please see your Consortium Members Page or contact me for more information or to link you to our presenters.
We thank both David and David of Jones Brown www.jonesbrown.com.