Employers want workplace innovation that helps employees plan for the future

Employers believe workplace pension providers have a bigger role to play in helping employees make informed financial decisions, according to new research from Royal London.

When asked about their innovation priorities, employers involved in workplace pensions said they wanted focus on practical support that helps employees make better decisions about their financial futures.

The most selected innovation priorities among the 960 employers surveyed were tools to support employees through different life stages at 20%, more personalised pension planning tools at 23% and more guidance and information on investment options at 18%.

The findings suggest employers are looking for workplace pension providers to go beyond scheme administration and offer support that improves employee engagement, decision-making and understanding.

Catherine Stewart, Head of Workplace Proposition at Royal London, said:

"Employers are looking for practical tools and support that help employees understand their pension, make informed decisions, and engage with their long-term financial future.

"Different employers will need different types of support depending on their size, workforce, and benefits strategy. Working with providers, advisers can help employers cut through the noise and focus on the areas of innovation that will make the biggest difference to their employees."

Priorities vary by organisation size

The research shows that employer priorities vary by organisation size. Larger firms place greater emphasis on digital innovation, wellbeing support, and ESG-focused investment options, while smaller firms are more focused on practical employer support and are more likely to say no further innovation is needed.

Larger firms (more than 250 employees) were more likely than small firms (less than 50 employees) to prioritise improved digital platforms and user experience, at 22% compared with 13%. They were also more likely to prioritise broader financial wellbeing support for employees, at 13% compared with 9%, and sustainable and ESG-focused investments, at 12% compared with 6%, and AI or technology driven financial advice, at 17% compared to 7%.

By contrast, 19% of small firms said they did not think any innovations were needed, compared with 7% of large firms.

Catherine Stewart added:

"For smaller employers, the priority may be making workplace pensions easier to manage. For larger employers, pensions may increasingly form part of a wider employee benefits and workforce wellbeing strategy.

"This is where tailored advice matters. A workplace pension scheme should reflect the needs of the business and the workforce it supports. The best innovation is not necessarily the newest feature, but the one that helps employers and employees achieve better outcomes."

Core pension features remain important. Among employers involved in workplace pensions, competitive fees and charges were selected by 46%, strong investment performance by 43%, easy-to-use portals and tools by 39% and reliable customer support by 35%.