IT major Infosys on Tuesday said it has partnered with investment management company Vanguard whereby it will manage certain activities of the US firm.
Through the partnership, Infosys will assume day-to-day operations supporting Vanguard's DC (type of retirement plan) recordkeeping business, including software platforms, administration, and associated processes, a statement said.
The deal will see approximately 1,300 Vanguard employees - currently supporting the full-service recordkeeping client administration, operations, and technology functions - transitioning to Infosys, it added.
All Vanguard staff currently performing these roles will be offered comparable positions at Infosys in close proximity to Vanguard's offices in Malvern in Pennsylvania, Charlotte in North Carolina, and Scottsdale in Arizona, the statement noted.
"Transitioning employees will receive the same salary, comparable benefits for a transition period of 12 months, plus meaningful incentive opportunities. Infosys is dedicated to this business and the transition offers prospects for long-term career growth and development," the statement said.
Plan sponsors (usually a company or employer) will continue to be served by Vanguard's relationship management teams, strategic plan design, and communication experts, the statement said.
Additionally, Vanguard will oversee all aspects of its investment management and guidance for both sponsors and participants, including the ongoing development of its accessible, holistic, and personal advice services, it added.
Participant phone calls will be serviced by both Vanguard and Infosys. Together with Infosys, Vanguard will provide a cloud-based recordkeeping platform, enabling greater insights and personalisation to help deliver better outcomes for nearly five million participants and 1,500 sponsors.
Vanguard is one of the world's largest investment management companies. As of May 31, 2020, Vanguard managed USD 5.9 trillion in global assets. Headquartered in Valley Forge, Pennsylvania, the firm offers more than 425 funds to its more than 30 million investors worldwide.
"For decades, Vanguard has propelled best practices and innovation within our DC business and across the industry to steward the financial futures of millions of Americans saving for retirement.
"Our partnership with Infosys will embolden these efforts, enabling a groundbreaking approach to plan administration," Martha King, managing director of Vanguard Institutional Investor Group, said.
King, currently head of Vanguard Institutional Investor Group, will also transition to Infosys to head the firm's Mid-Atlantic Retirement Services Center of Excellence and serve as the firm's Chief Client Officer.
The transitioning Vanguard crew will report up through King and Infosys President Mohit Joshi.
"Infosys is excited to partner with Vanguard in the digital transformation of its defined contribution business. Our platform will create a new standard for the industry as we seek to drastically improve the retirement savings experience for plan participants and sponsors through the use of cutting-edge digital technologies," Joshi said.
Infosys said it currently serves half of the top 20 retirement service firms in the US, helping clients to manage risk, improve the participant experience, and deliver better retirement plan outcomes through business transformation, technology services, and digital solutions.
"Infosys has deep expertise serving leading retirement services firms in the US and, as part of this strategic partnership with Vanguard, we look forward to transforming the retirement industry while helping clients manage their retirement needs leveraging advanced digital solutions," Infosys CEO Salil Parekh said.