This global mobility update memo is testament to the huge amount of work and progress that has resulted in the nine months following the acquisition of ORC Worldwide.

One highlight I’d like to mention upfront is that the 2011 product releases are proceeding on schedule. The production teams deserve a round of congratu-lations for achieving this despite the additional workload brought about by the integration. We also continue to make enhancements in our tools and in our coverage to meet client needs and expectations.

Looking back at our many achievements, we can also look forward with confidence and excitement to the next phase where we will demonstrate to our clients the greatness of our new global mobility capabilities. In this new phase we will:

Define business requirements and design the new integrated functionalities in our tools that clients use to access our information

Consolidate our policy design, benchmarking and information consulting capabili-ties to allow us to seize the vast opportunities we have for our combined business

Position Mercer in the marketplace as the Global Mobility thought leader Roll out a client service model that applied globally means we are consistently fol-lowing our governance principles

I continue to act as the global mobility leader and head of the EMEA center of excellence until that time that the new person has been appointed to fill the global role. It is an exciting challenge and I am looking forward to work-ing with both new and old colleagues and take the EMEA mobility business to even higher levels.

As we advance on these fronts we will share with you our progress.

Carlos Mestre

Update Memo – May 2011

Dear Colleagues,

This IssueWhat you’ll find in this memo:

1 Greeting from Carlos Mestre

2 Cost of Living and Expatriate Accommodation Costs Survey March 2011 survey release

2 Expatriate Purchase Patterns Survey (EPPS)

3 Currency change for Estonia

3-4 New International Spendable Income feature in Global HRMonitor

4-6 Update on the Mercer/ORC integration

7-8 Mercer’s Global Mobility Academy

9 Strategic focus for Global Mobility Software

10 New MercerPassport split countries

11 Global Mobility product information on the new SharePoint site

12 Global Mobility new hires

13-14 Notable dates – Product releases

Inside Global Mobility Internal Memo

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Cost of Living and Expatriate Accommodation Costs Survey March 2011 survey release The March edition of the Mercer Cost of Living and Expatriate Accommodation Costs surveys was released on Monday, 9 May 2011.

Please note that due to the political situation, the following cities have not been surveyed for the March Cost of Living reports:

Sana’a, Yemen (non-standard city) Tripoli, Libya Abidjan, Côte d’Ivoire Manama, Bahrain

A warning message has been set up in Global HRMonitor to remind users when entering these cities for calculations that the data is for September 2010.

The Expatriate Accommodation reports, however, have been updated for all cities including these ones above.

Japan COL dataHost locations pricing data for Mercer ORC Japan was released this spring; it was collected pre-earthquake but is still valid as outlets have generally not increased the prices of goods. There have been reports of shortages of some staple goods but it has not affected prices. Our staff in Japan has confirmed this and commented that it would go against Japanese culture and emotions to raise prices in the aftermath of a natural disaster. We will continue to monitor the situation in Japan and if shortages continue or prices of goods do begin to rise, we will take necessary steps, such as conducting the next round of pricings earlier then usual.

Expatriate Purchase Patterns Survey (EPPS)For a number of years, ORC ran a survey of where expatriates shop in various locations around the world; Mercer will continue this tradition. As a courtesy to our clients, we will extend an invitation to clients who pur-chase Mercer’s Cost of Living reports to give feedback on retail outlets and service providers patronized by their expatriates and family members.

The survey is used to ensure our prices are gathered at representative stores.

The survey will be accessible online. There will be a deadline for comple-tion (about six weeks after the launch of the survey); however, the survey will actually remain open indefinitely should clients decide to participate at a later date.

The EPPS is live as of 20 May 2011. For more information please contact Jason Mele.

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Currency change for EstoniaPrices for the March 2011 Cost of Living Survey for Tallinn are in EUR rath-er than EEK, following the adoption of the Euro in Estonia on 1 January. The 2011 tax and spendable income data (EUR) for Estonia will be released on 30 May.

As of 9 May 2011, the following historical data in EEK are no longer avail-able on Global HRMonitor:

2010 Estonia Tax Data

2010 Estonia Spendable Income and Home Housing Norms Data

2009 and 2010 International Spendable Income data for Estonia

New International Spendable Income feature in Global HRMonitorWe are pleased to announce the release of our new International Spendable Income feature on Global HRMonitor.

This enhancement, released on 14 May, enables you to calculate and display International Spendable Income (ISI) amounts by gross income as well as by IPE level, which allows more precision in the salary data returned by the calculators. We are also implementing this change in the Expatriate Compensation Calculator and in ExpatMonitor.

Along with this new feature we have updated the user help and method-ology content for ISI within Global HRMonitor and also improved the for-matting in the results tables.

What is ISI?When sending employees from countries with low income structures or from countries where dual incomes are necessary to allow for a comfort-able standard of living, the ‘balance sheet’ approach does not always gen-erate a competitive salary in the host location.

Mercer’s International Spendable Income tables allow companies to substitute the home country non-competitive spendable income salary component with benchmark spendable income levels. The International Spendable Income tables provide you with the ability to develop competi-tive spendable incomes for your employees wherever they come from, while keeping a ‘home country’ compensation approach. It has the advan-tage to contain costs as only the spendable income component is adjust-ed to international standards, to encourage mobility and facilitate return to home country; and it is consistent globally.

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The chart below shows you how a pure home balance sheet approach compares to the International SI approach for an IPE 50 employee sent from Mumbai to Paris.

A. Home Balance Sheet Approach

Gross Base

Salary

Indian Spendable

Income

COLA using COL

Index Mumbai to

Paris (144)*

Adjusted Indian

Spendable

Income

Adjusted

Indian

Spendable

Income

French

Spendable

Income

INR INR INR INR EUR EUR

709,557 378,527 166,552 545,079 8,59 22,581

B. Modified Balance Sheet Approach using ISI option

Gross Base

Salary

Inter-

national

Spendable

Income (ISI)

amount at a

Mumbai cost

level

COLA using COL

Index Mumbai to

Paris (144)*

Adjusted Inter-

national

Spendable

Income

Adjusted

Inter-

national

Spendable

Income

French

Spendable

Income

INR INR INR INR EUR EUR

709,557 1,301,102 572,485 1,873,587 29,526 22,581

*Based on March 2010 Survey, Mean to Mean Cost of Living index

In Table A, the Indian Home spendable is adjusted by the Cost of Living Index and the adjusted Indian Spendable Income amount is compared to the Spendable income of a French employee for the same position level. In Table B, the Indian Spendable Income amount is replaced by an International Spendable Income amount. Table B provides an adjusted International Spendable Income that is comparable to the spendable income of a French employee. The home components of the Indian Salary remain unchanged.

For more information please visit the methodologies section of Global HRMonitor or contact Natalie Castro.

An update on the Mercer/ORC integration from Tom Jacob What are the key milestones that have been achieved so far with the integration?

We’ve made a great deal of progress. From the beginning, we’ve oper-ated under the premise that we will not make any changes to our prod-ucts that would have an adverse impact on our clients. We’ve adhered to that, and have not lost any clients as a result of the integration. In fact, a number of clients have been quite pleased with the access they now have to additional data and information. fORC clients now have access to MercerPassport and a variety of Global Insights reports via their on-line portal. We now have a clearer understanding of each of our combined suite of products and methodologies, their similarities and differences.

Integration

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We’ve identified those that can be combined into a single product that is better than what is currently offered. We’ve created a long-term roadmap that will guide us in our product integration and new product develop-ment activities. We recognize our people have to be comfortable with the products they sell and service and as a result, have created a number of documents and ran a number of internal webinars that help to explain some of our hardship, cost of living, and other products and their meth-odologies. This material is now posted on SharePoint. Additional material and product webinars will be forthcoming. Watch for a Housing webinar invite, which is scheduled for June 14th and 16th.

Can you give any examples of client success stories as a direct result of the inte-gration? What were the quick wins that were targeted for the first phase of the integration?

Most of the initial quick wins have been process related. For example, we can streamline the global network pricing agents we use to conduct surveys of goods & services and housing costs. We’ve been able to offer our clients products that weren’t available to them before the integration such as MercerPassport (to fORC clients) and RealTime RentCheck (to leg-acy Mercer clients). We’ve also been able to introduce them to new areas of thought leadership – for example, by expanding our mobility round-table agendas to include subject matter experts from other Mercer lines of business. We’ve also had great success working with Client Managers who have introduced mobility services to their clients. An example is Danaher Corporation, in Washington, DC. The Client Manager arranged a meeting with his contact which resulted in an immediate consulting engagement (policy development) and the potential for significant downstream data revenues as their operating companies engage Mercer to provide mobility services.

What has been the most challenging aspect of the integration process so far?

Initially, many of us felt the fORC and Mercer mobility products were very similar and integrating the two would be relatively easy. While on the surface there are many similarities, we in fact have significant differences not only in methodology, but also in our service delivery models which made integrating the two not only challenging but has taken longer than originally anticipated. One of the challenges is our clients currently must go to multiple places if they want fORC or legacy Mercer products. Clearly, this is not ideal. Another challenge is not confusing the market. We need to have a single client experience regardless of the product offering; know our products are the best in the market and understand when and where to recommend their use. Ultimately, some products will be integrated, some eliminated and new innovative products created. Knowing there are many exiting things on our three year roadmap, we look forward to your taking the journey with us.

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Have there been any surprises (good or bad) throughout the process?

As stated above, the biggest surprise might be how difficult this integra-tion really is. We have a lot of good people working very hard to be sure we do it right as well as strive for an innovative product suite. We’re all on the same team, and the collaboration has been great. We now have many more mobility professionals who are able to assist in the sales process. Most of them have established relationships with regional Client and Relationship Managers, as well as their regional Market Reps. These rela-tionships are translating into new business (consulting and data). We’ve been very pleased with the way our colleagues throughout the firm have embraced mobility as a revenue generator.

Can you give a brief description of this project’s leadership team’s objectives and an outline of the role of the product governance counsel?

The ORC acquisition made Mercer the undisputed leader in the field of global mobility services. Quite simply, our objective continues to be developing and bringing to market the best mobility products, services and technology, and having the best talent to support them. The Mobility Product Strategy & Standards Governance Council consists of key stake-holders in the mobility business in the Americas, EMEA, and APAC as well as key members of the global product group. The group is used to vet recommendations brought to it by the Core Mobility Products team, which is responsible for the overall product integration. Product decisions are vetted within each Region and then made by the Governance Council, which conducts bi-weekly conference calls. I am is leading the integra-tion effort in my role as both the leader of the Core Team and the Mobility Governance Council.

What are the next steps to be taken towards achieving the goals of the integra-tion project?

We’re in the process of developing sales scripts that will help our sales and client facing professionals lead their clients and prospects through a consultative selling process. We feel there is a great deal of unreal-ized potential in housing data, which tends to be the most costly benefit provided to expatriates. We have clients who use housing data they buy from other sources, therefore, we’ve agreed to make development of a new, innovative client-centric housing product a priority, and will soon be defining the business technology requirements for it.

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Mercer’s Global Mobility AcademyElena Oriani, mobility leader for Southern Europe, has set up a ‘Global Mobility Academy’. Building on Mercer’s expanded competencies in the mobility arena as a result of the ORC acquisition, Elena is working to posi-tion Mercer as the superior global mobility consulting partner in Italy for large Italian multinationals. Following, she answers some of our questions about the Academy.

What are the strategic objectives of the Academy?To create a network of senior HR directors interested in exchanging experi-ences and sharing ideas on latest trends, developments and know-how in global mobility. We will also leverage Mercer’s intellectual capital to create added value for participants and collaborate with other Mercer LOBs to cre-ate synergies and offer a broad range of solutions for Italian multinationals. Mercer will do this by acting as facilitator and thought leader.

What will the Academy offer to its members?The Academy will hold two roundtable meetings each year for mem-bers, to take place at the Mercer offices in Rome and Milan. Members will receive bi-annual newsletters (articles in Italian written by Mercer experts on expat issues from different LOBs) and will be entitled to a 10% discount on Mercer European expatriate training. Members will also be entitled to a 10% discount on Mercer EMEA conferences (Expat Forum and Comp & Ben Conference) if one of the following applies:

Client has a subscription to EMP

Client purchases Mercer data (min USD 20.000 per year)

Client is a paying participant at the Expat Forum

Where did the idea to set up the Academy come from?The idea for having an Italian Academy on Mobility is due to the fact that in Italy there is no HR association focused on the subject of mobility. Furthermore we need to position ourselves strongly in the market with regard to competition from ECA (Employment Conditions Abroad).

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What are the next steps to get this project off the ground?We are defining a steering committee made of key players, including subject matter experts and HR opinion leaders. This committee will meet twice a year to identify subjects to propose during the two roundtable meetings. They will also collect and analyze feedback on the events dur-ing the year and identify areas for improvement. Already confirmed on the committee are ENEL, ENI, Ferrero, Unicredit, Finmeccania, Saipem and Generali – also indicating a strong interest are Pirelli and Fiat. The first meeting will take place in June and the first roundtable will be in September/October.

Until now I have been promoting the initiative through personal meetings and calls in order to build up the steering committee. Now that this is almost complete, we will be promoting the Academy to the other medium to large Italian multinationals on our target list.

Is this Academy exclusive to Italy?As far as I’m aware there are no set plans to develop the same Academy in other regions, however we are very willing to give support to those con-sultants who would like to develop a similar programme in their country.

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Strategic focus for Global Mobility SoftwareTo move Global Mobility’s software roadmap forward towards Mercer WIN, Mercer is engaging software development consulting firm Geneca. The Mercer WIN project within IPS has so far seen a major review of our service delivery model for our compensation business – next is Global Mobility. To lead this initiative Mercer is in the process of recruiting a Mobility Software Product Manager who will lead the effort to define and manage the roadmap for putting our mobility offering in the Mercer WIN platform, as well as the long-term technical vision of the remaining Mobility products.

Beginning to move forward with Geneca, the Expatriate Accommodation (Housing) product will be the first to be reviewed for development. Why Expatriate Accommodation? It has been identified by the Mobility Governance Council that housing has the most potential of the mobil-ity products for development and has the highest degree of vulner-ability from the competition, notably from Air Inc. Last week a meeting took place with the Housing product managers, Marie-Laurence Sepede, Sanjeev Barnabas and Steve Mancuso, Mobility Operations Leader, to solidify the direction of the Housing process and team in preparation for the Geneca kick-off.

Current suggestions for the ‘dream product’ include:

Create a standalone product offering

Create a tool that directs the client to a housing allowance recommen-dation (consider coupling this with IPE type data to provide better direc-tion/conclusions)

Analyze overall cost projections or cost tracking by location/region

Provide interactive neighbourhood maps: integrated with rental allow-ances (mouse over or click on an area and relevant allowances are dis-played. Also drill down to property pictures where available and provide availability ratings)

Include tax information on housing rental

The potential for integrating some of these enhancements into the MercerPassport product is also being explored. For more information on operations development, please contact Steve Mancuso.

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New MercerPassport split countries In June this year, we will be releasing a number of ‘split’ countries in MercerPassport due to an increase in demand for the number of cities to be covered in some of the best selling guides. Some of these guides are becoming too large to load and navigate, therefore we will be selling the following as split country reports:

New US guides:US West: Los Angeles, Portland*, San Francisco, Seattle*

US Central: Chicago, Cincinnati*, Detroit*, Dallas*, Houston

US East: Atlanta*, Boston*, Philadelphia*, New York, Washington DC

* new cities researched for 2011

The previous US guide will no longer be available once the three new guides are released in June. These new reports will be priced separately: €375 or $490 each. For clients who have already purchased the US report this year, their existing US report will be substituted with all three reports for no additional charge. For all new MercerPassport clients going forward, each new US guide is chargeable separately.

The same principle applies for Australia, which will also be split into sub-country regions for this release:

Australia East: Brisbane, Canberra, Melbourne, Sydney

Australia West: Adelaide, Darwin, Perth

Coming later this year will be split reports for the UK, India and China.

New Start GuidesNew guides to be released on MercerPassport this year are Afghanistan, Cameroon, Guinea Republic, Namibia and Uruguay.

Change password disabledAnother change to MercerPassport in this release will be the removal by default of the ‘change password’ function. Many companies opt for a generic or shared login and password for their employees to access MercerPassport; however, until now, we haven’t had the option to stop some employees changing the password so others in their organization are blocked from accessing. With the new feature all group and individual users will not be able to change their passwords unless a specific request is made to client services to enable the change password option.

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Global Mobility product information on the new SharePoint siteOn 11 April, Information Product Solutions launched its new intranet site in SharePoint, replacing the former LiveLink library. Please take some time to look at the information that is being posted on this site to support product knowledge.

Global Mobilityhttp://sharepoint2.mercer.com/sites/LOB/IPS/StandardPages/SolutionSelect.aspx

Global HRMonitorhttp://sharepoint2.mercer.com/sites/LOB/IPS/StandardPages/Product.aspx?ItemID=29

ExpatMonitorhttp://sharepoint2.mercer.com/sites/LOB/IPS/StandardPages/Product.aspx?ItemID=27

MercerPassport http://sharepoint2.mercer.com/sites/LOB/IPS/StandardPages/Product.aspx?ItemID=167

We gladly welcome new or updated content. If you have any document or information you would like to see added please send an email to Ryan Risk or Anne Rossier-Renaud.

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Global Mobility new hiresMarijke Have Marijke joined in January this year and is based in the Netherlands with the EMEA Mobility Centre of Excellence. Marijke is responsible for busi-ness development in the Benelux region and brings 14 years of experience in global mobility gained in a range of international assignment and com-pensation and benefits roles at KLM Airlines, ING Barings and Randstad Holding.

Stella PrincipiStella accepted an internal move to join the Cost of Living produc-tion team in Geneva as a regional analyst for the Middle East, Italy and Overseas French territories from 1 March 2011.

Adriana ZiomkoAdriana is a new analyst working for the Cost of Living team for the Germany and Eastern Europe areas.

Mike ShoreMike joined Mercer as a consultant on 9 May. He is based in Boston and reports to Ed Hannibal. Mike has many years of experience assisting cli-ents with their housing programs and developing Airinc offerings such as their International Housing Guide.

Jorie Weinger Jorie joined Mercer in Chicago on 4 April as an analyst working in the US Midwest team supporting the consultants and their clients.

Gwyn Chiem Gwyn rejoined in San Francisco on 11 April as an associate to manage, service and conduct consulting work for clients in the US western region.

Anne Teulet-CoteAnne rejoined in Chicago on 2 May as an associate to manage, service and conduct consulting work for clients in the US midwest region.

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Notable dates – Product releases27 May International Spendable Income tables for 2011

Early June 50 Full Expatriate Accommodation Cost tables March 2011 survey

6 June Cost of Living & Expatriate Accommodation costs survey overview

Notable dates – Events11-12 May Rewards Summit, Chicago

12-13 May Expatriate Management Forum, Prague

25 May Introduction to Expatriate Management Training, Istanbul

26 May Advanced Expatriate Management Training, Oslo

7-8 June Introduction to Expatriate Management Training, London

14 & 16 June Housing Product Webinar

15 June UAE HR Forum, Dubai

29-30 June Introduction to Expatriate Management Training, Paris

30 June UK Expatriate Forum, London

9 August Principles of the Balance Sheet Training, New York

10 August Advanced Data Applications, Compensation Approaches, and Policy Development, New York

13 September Principles of the Balance Sheet Training, Houston

14 September Advanced Data Applications, Compensation Approaches, and Policy Development, Houston

15-16 September Introduction to Expatriate Management Training, Amstelveen

29-30 September Introduction to Expatriate Management Training, Zurich

15 November Principles of the Balance Sheet Training, New York

16 November Advanced Data Applications, Compensation Approaches, and Policy Development, New York

21-22 November Introduction to Expatriate Management Training, Paris

23 November Advanced Expatriate Management Training, Paris

8 December Advanced Expatriate Management Training, Amstelveen

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Copyright 2011 Mercer LLC.

All rights reserved.

Client WebcastsCreating Global Mobility Strategies That Pay: Aligning Compensation with Objectives

14 June, 2pm London time & again at 2pm New York time

Speakers: Catherine Gervais & Michael Joyce

Localization and Local-Plus Conditions

26 July 11am Singapore time, 26 July 1pm London time and again on 27 July at 1pm New York time

Speaker: Phil Stanley

Internal WebcastsHousing Product: Introduction to legacy Mercer & fORC products

14 June, 9am London time

16 June, 10am NY time

Speakers: Marie-Laurence Sepede & Sanjeev Barnabas