New Aon Hewitt Retirement Solution Offers Clients Investment Management Flexibility, Fee Transparency and Fiduciary Oversight over their Defined Contribution Plans

DC Nexus Includes Industry's First Institutional Investment Exchange

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Oct 28, 2013, 09:13 ET

LINCOLNSHIRE, Ill., Oct. 28, 2013 /PRNewswire/ -- Aon Hewitt, the global talent, retirement and health solutions business of Aon plc, today introduced DC Nexus, a robust, web-based solution that enables Aon Hewitt's defined contribution (DC) recordkeeping clients—and their trusted advisors—to supplement their existing plan investment management and governance processes and better manage their DC plans through increased investment flexibility, fee transparency and decision support. DC Nexus is part of Aon Hewitt's comprehensive suite of retirement solutions that help improve employees' financial wellness and enable plan sponsors to implement new and sustainable benefits strategies, manage fiduciary risk and leverage institutional purchasing power.

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DC Nexus creates the industry's first proprietary institutional investment exchange that facilitates increased fee transparency and provides better control over plan expenses. The exchange leverages Aon Hewitt's open architecture to enable users to obtain clear pricing information on multiple competing investment alternatives, including institutional investment vehicles, before a final hiring decision is made for a given mandate.

Aon Hewitt's research shows a significant increase in the number of plan sponsors using institutional fund options in their DC fund lineups. Today, 90 percent of large plan sponsors offer at least one institutional fund option, and approximately one-third of plans utilize institutional vehicles as the majority of their fund options, compared to 58 percent and 19 percent, respectively, in 2007. Despite the strong benefits of institutional investment alternatives, such as lower expense ratios, most plan fiduciaries currently lack the ability to compare transparent fee information for these funds in one place.

"Plan sponsors truly want to help their employees plan for, and achieve, a financially secure retirement. At the same time, they face increasing scrutiny regarding the oversight of the investment options within their DC plans," said Cary Grace, president of Client Strategy and Solutions at Aon Hewitt. "Balancing those goals has been difficult without a tool like DC Nexus, which makes it easy for plan sponsors to obtain the information they need to effectively manage their plans."

According to Aon Hewitt research, more than three-quarters of plan sponsors said that the level of scrutiny they face today is either "high" or "very high" and more than 80 percent report that the level has increased in the last two years.

"DC Nexus leverages Aon Hewitt's unique position as the largest independent DC record keeper to help plan sponsors supplement their existing processes and empower them to do more with their DC plans," said Winfield Evens, director of Outsourcing Investment Strategy at Aon Hewitt. "DC Nexus helps plan sponsors evaluate their own plan offerings against the wider universe of institutional investment vehicles available, to optimize their DC plan performance and ultimately improve participant outcomes."

DC Nexus also features:

Plan Information –On-demand access to current plan and fund information, including performance, balances and fees. DC Nexus users can access both high-level and detailed information for investment options in their plans whenever needed.
Analytics – Detailed analytics tools that allow plan sponsors and their consultants to thoroughly research and quantitatively measure existing plan options and assess alternative investment options. Users also have complimentary access to information and analytics from eVestment Alliance, a leading institutional database, for information on the broad universe of investment alternatives.
Education – Industry-leading retirement research and thought leadership that keeps plan fiduciaries informed of the latest retirement trends and opportunities. Users can readily access Aon Hewitt research, as well as information curated from across the industry.

"The industry has needed a tool like this for a very long time," said Brant Suddath, director of Benefits for The Home Depot. "Access to both consolidated information for the existing plan options as well as the institutional investment exchange is something that hasn't existed before for plan sponsors. This increased level of transparency will help organizations better manage their DC plans."

DC Nexus is available to all Aon Hewitt DC recordkeeping clients, which represent more than $330 billion in DC assets. Approximately three-quarters of Aon Hewitt's recordkeeping clients currently have access to DC Nexus, and the remainder will have access by year-end. More than 160 asset management firms that collectively manage more than $9.2 trillion in assets, including BNY Mellon, Legg Mason, Morgan Stanley Investment Management and OFI Global Asset Management have completed or are finalizing the formal contracting process to join DC Nexus.

"We see DC Nexus as an opportunity to gain greater visibility for our investment strategies and retirement thought leadership for Aon Hewitt's largest plan sponsors," said Robert Capone, executive vice president and head of retirement for BNY Mellon. "BNY Mellon's institutional offerings including bank collective funds and separate accounts, along with mutual funds, are well suited for this program. In addition, the inherent transparency that DC Nexus provides will be an excellent way for plan sponsors to obtain information more comprehensively to better manage their plans."

Click here for more information on DC Nexus.

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About Aon Hewitt
Aon Hewitt empowers organizations and individuals to secure a better future through innovative talent, retirement and health solutions. We advise, design and execute a wide range of solutions that enable clients to cultivate talent to drive organizational and personal performance and growth, navigate retirement risk while providing new levels of financial security, and redefine health solutions for greater choice, affordability and wellness. Aon Hewitt is the global leader in human resource solutions, with over 30,000 professionals in 90 countries serving more than 20,000 clients worldwide. For more information on Aon Hewitt, please visit www.aonhewitt.com.

About Aon
Aon plc (NYSE:AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 65,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world's best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources. Visit www.aon.com for more information on Aon and www.aon.com/manchesterunited to learn about Aon's global partnership and shirt sponsorship with Manchester United