Governance legislation will fail objective: ISA
The Federal Government's legislation aimed at imposing one-third independent directors on superannuation fund boards, including an independent chairman, will not achieve its objective of injecting diversity, according to Industry Super Australia (ISA).
ISA chief executive, David Whiteley has used his opening address to the Senate Committee reviewing the legislation to claim that the current make-up of industry fund boards delivers greater diversity than would be delivered under the Government's changes.
"One of the government's objectives is to better align fund governance with the Australian Securities Exchange (ASX) approach," he said.
"However, the prescriptive approach of the Bill and unprecedented powers proposed for the Australian Prudential Regulation Authority (APRA) are inconsistent with the principles based approach of the ASX."
Whiteley claimed that, equally inconsistent, was the proposed mandating that at least one third of trustees should be independent.
"We agree with the AICD and Governance Institute that mandating a governance model is inferior to a principle based approach, a conclusion reached by Justice Owens following the HIH Royal Commission," he said.
"To lock the super industry into a rigid model is unnecessary and counter to governance principles in other APRA-regulated entities such as banks."
Whiteley said the bill was intended to build diversity on boards, but would do the opposite.
"Currently industry super funds directors are drawn from all walks of life, but by virtue of an association with a union or employer body deemed to be from the same gene pool. Yet four in five directors from bank owned funds are finance industry insiders," he claimed.
Recommended for you
Delayed climate action could wipe hundreds of billions from superannuation balances by 2050, according to new analysis from Ortec Finance.
APRA deputy chair Margaret Cole has called on superannuation trustees to accelerate efforts to support members moving into retirement and to strengthen protections against growing cyber and operational risks.
Super trustees need to be prepared for the potential that the AI rise could cause billions of assets to shift in superannuation, according to an academic from the University of Technology Sydney.
AMP’s superannuation business has returned to outflows in the third quarter of 2025 after reporting its first positive cash flow since 2017 last quarter.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
215.17 3 y p.a(%)
2
Loftus Peak Global Disruption Fund Hedged
118.15 3 y p.a(%)
3
Global X 21Shares Bitcoin ETF
75.00 3 y p.a(%)
4
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
61.11 3 y p.a(%)
5
Global X Ultra Long Nasdaq 100 Complex ETF
60.93 3 y p.a(%)
