New Study Reveals Localization Practices in Asia-Pacific
MORRIS PLAINS, N.J.,– Localization of international
assignees is on the rise through Asia Pacific and companies are increasingly
instituting formal localization policies.
Results of a groundbreaking survey identify the forms of assistance
provided localized employees in the APAC region and show that flexibility is
key in applying these policies to individual circumstances.
Resources Inc. (WRRI) and Worldwide ERC®, with assistance from the
Hong Kong Institute of Human Resource Management, surveyed 91 companies with international activity and
localized employees in the APAC region to determine the reasons why they
localize their employees and the methods they utilize. For purposes of this survey, localization was
defined as the process by which an employee on assignment in a host country
location is transitioned (partially or totally) to that location’s employment
terms and conditions.
respondents that localize employees in APAC, 80 percent follow a formal policy
or set of established guidelines.
significant, as it illustrates just how widespread the use of localizations has
become,” said Ellie Sullivan, Director of Consulting for WRRI. “According to
Worldwide ERC®’s 2008 Global Benchmarking Survey, the number of companies with
formal localization policies in place has doubled over the past five years.”
As for the
reasons for localization, the most common, cited by 53 percent of respondents,
is to control assignment costs, while others include business necessity (30
percent) and accommodating employee choice or desire (12 percent). The APAC
areas with the highest concentrations of localized employees, according to our
respondents, include Mainland China
(69 percent), Singapore (67
percent), Australia (48
percent) and Hong Kong (41 percent).
however, does not mean complete transition to local terms and conditions
immediately. Eighty-three percent of the respondents migrate their assignees to
local terms and conditions through a gradual phase-out of expatriate and other
home country benefits, with the most popular transition schedule lasting three
years. However, some mobility benefits
may be cut off immediately, while others may never be discontinued.
top benefits most likely to be retained at least for some period of time are
household goods shipment (78 percent), housing allowance (73 percent), home
country home sale benefits (54 percent), transportation assistance (48 percent)
and, cost-of-living allowances (47 percent).
providing a final household goods shipment to the destination location is not
surprising, the fact that 73 percent of respondents who localize employees in
Asia Pacific retain the host housing allowance is quite significant,” said Jan
Hatfield-Goldman, Worldwide ERC® VP of Research and Education. “This
makes sense when looking at the top localization destinations as they include
some very costly destination cities in Asia Pacific.”
finding reveals the major challenges of localization to the APAC region, the
most significant of which among respondents is finding a suitable and
comparable pension program when transitioning employees to local status. Other
cited challenges included consistency of policy application and income
interested in receiving localization survey results can e-mail email@example.com
or link to survey results at Worldwide ERC®.
Weichert Relocation Resources
Relocation Resources Inc. (WRRI) is a leading provider of relocation, global
and international assignment solutions that help some of the world's leading
companies avoid inventory, increase employee home sales, enhance mobile
workforce management and reduce program costs. A Balanced Scorecard Hall of
Fame Company, WRRI provides a unique combination of stability, financial
expertise and seasoned leadership that has made the company a trusted,
proactive partner to clients throughout the world. For more information,
About Worldwide ERC®
ERC® is the
recognized industry authority on relocation and international assignments in
and major global traffic areas. Worldwide ERC® provides leadership, advocacy, education and networking to
global workforce mobility professionals and stakeholders through specialized
training, credentialing, meeting events and information exchange. Worldwide ERC® is headquartered in
the Washington, DC
metropolitan area, with offices in Brussels, Belgium and Shanghai, China.
Contact Worldwide ERC® at +1 703 842 3400, or visit www.WorldwideERC.org.