“Treating” of execs by super funds must end
Royal Commissioner Kenneth Hayne has responded to evidence of superannuation fund executives “treating” employers to meals and sports games by recommending that the Superannuation Industry (Supervision) Act 1993 be amended to prohibit the practice.
While Hayne acknowledged that this could be part of establishing relationships with employers to develop default fund options, he did not agree that it was appropriate.
“Section 68A of the SIS Act should be amended to prohibit trustees of a regulated superannuation fund, and associates of a trustee, doing any of the acts specified in section 68A(1)(a), (b) or (c) where the act may reasonably be understood by the recipient to have a substantial purpose of having the recipient nominate the fund as a default fund or having one or more employees of the recipient apply or agree to become members of the fund,” the report specifically said.
Hayne also said that he didn’t accept suggestions that prohibiting such actions would disproportionately disadvantage industry super funds who operate without the benefit of established banking relationships with employers.
“Even if that were so, I do not accept that trustees should be permitted to attempt to influence employers’ decisions through irrelevant considerations,” he continued.
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