7-'-10 " Mr. Chairman, and Members of the Committee, I am Donald H. Sauvigne, Program Statement of the values embedded in the employment relationship, all employers, large and small, must account Director of Retirement and Capital Accumulation Programs for the IBM Corporation. The American Savings Education Council for the dramatic changes in the composition of the workforce, the demographic changes and labor I am appearing here today on behalf of the American Savings Education Council (ASEC). before costs. In this changing environment, a newly defined partnership of shared responsibility is ASEC was founded in the fall of 1995 following the launch of the Retirement Savings Education The House Education and Workforce Subcommittee evolving between employers and employees. The era of paternalism is past ....the demands of a Campaign of the Department of Labor as announced by the Secretaries of Labor and the on Employee - Employer Relations partnership are present. IBM has lived and learned this reality. Treasury. ASEC is a coalition of more than 200 private and public sector partners dedicated to of IBM is a global company in the business of providing advanced information services, raising public awareness about what is needed to ensure long-term personal financial The House of Representatives products, technologies and solutions to its customers worldwide. At year-end 1996, IBM independence. ASEC's goal is to make saving and planning for retirement, and life, a vital Congress of The United States employed more than 110,000 employees in the United States, and contributed social security concern of Americans and in the economic interest of employers. ASEC, pan of the Employee on payroll taxes in excess of ½ billion dollars. In addition, IBM funds, provides, and/or provides Benefit Research Institute Education and Research Fund, is a nonpartisan organization that does Employee Education and Retirement Income Security access to, a broad array of competitive compensation and benefit programs to a population not lobby or take positions on public policy legislation. including employees, retirees and other beneficiaries that exceeds 300,000 citizens. I am also here as a founding panner of the Council and on behalfofASEC's sponsors to Today, our plans remain as leadership programs, but they have been redesigned to support February 12, 1997 briefly review IBM's activities and objectives in assisting our employees in understanding the corporate competitiveness and profitability, and support employee ownership and responsibility importance of career-long planning for their post employment financial security. It is our goal Donald H. Sauvigne for their own future financial security needs. I believe we are in the midst of a story of success in IBM Corporation that judicious benefit plans and continual education will play a major role in securing our and that regard. I'd like to review that with you and demonstrate how continual and targeted Founding Partner and Policy Board Member employees' financial success. Although saving is occurring among our nation's workers, few American Savings Education Council (ASEC) education can have very measurable effects. would argue it is enough. What is currently missing is saving based upon a calculated goal and a In 1991, IBM began a deliberative program to both revise and introduce new programs plan to reach that goal. The next frontier demands we move beyond creating savers to creating and establish a new strategic resource direction for the company and its employees. This action planners that then save. was based on the need to change employee behavior about retirement income planning, increase The delivery of benefit plans, capital accumulation programs and the financial support of employees' financial involvement in theprocess, and more effectively use retirement fund assets. these programs is, of course, predicated on the continual success and profitability of the And indeed, over the last few years, we have continued to amend our plans to respond to these employing enterprise. Corporate success in a global marketplace requires continual adaptation to needs. A recent major change occurred in 1995. We generally reduced the value of our defined the changes around us as does our approach to the employment relationship. In the delivery of benefit plan...yet, reaffirmed its role as our base foundation retirement vehicle. Correspondingly, Page 2 February 12, 1997 Page 1 February 12, 1997 Page 3 February 12, 1997