Pension engagement has emerged as a key driver of business success in the UK, with two-thirds (64 per cent) of firms that took an active role in educating staff about pensions reporting “very good” financial performance, compared with 18 per cent among those that did not promote pension awareness.

The insurer’s latest study, Retirement Realities: Unlocking the Workplace Benefits, surveyed 1,000 senior decision makers responsible for workplace pensions and 2,000 employees across the UK.

It found a clear link between pension engagement and company performance, suggesting that initiatives to improve employees’ long-term financial well-being can deliver tangible commercial benefits.

Generous employer contributions were also shown to make a difference.

Among firms that contributed more than 8 per cent of salary into staff pensions, over two in five (41 per cent) reported “very good” financial results, while only 19 per cent of firms with “okay” performance levels did the same.

By contrast, just 11 per cent of high-performing businesses contribute only the 3 per cent minimum required under automatic enrolment.

Scottish Widows managing director of workplace and intermediary wealth, Graeme Bold, said the findings highlighted the “powerful but often overlooked role” of workplace pensions in shaping both employee and business outcomes.

“When employers invest time and effort into pension engagement, they're not just supporting their employees’ long-term financial well-being - they're also helping to drive stronger financial performance today,” Bold argued.

“It sets the foundations for a more engaged and productive workforce that attracts and retains top talent,” he added.

Notably, the vast majority of employers appeared to recognise the value of pension-related benefits, with 88 per cent saying they were important to their company’s financial success and 91 per cent viewing them as essential for attracting and retaining staff.

Echoing this sentiment, the findings also revealed that disengaged employees can pose a risk to workforce stability.

Indeed, almost a third (29 per cent) of employees surveyed said they had already left or were considering leaving a job because of poor pension provision.

Among these, more than two-thirds (68 per cent) cited a lack of competitive pension offering, while others pointed to low levels of communication or benefits that were difficult to access.

Bold claimed that campaigns such as the industry-led Pension Attention initiative were helping to bring pensions to the forefront of workplace discussions, but added that employers should continue the conversation year-round.

“Pension engagement is evergreen,” he said.

“It’s important that companies keep employees informed about their benefits package beyond awareness campaigns," he stressed, adding that technology had made this task “far easier”.

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