Will AI engagement prompt members to shift super assets?

The rise of artificial intelligence will cause a “major transformation” in superannuation as the balance of power shifts from funds to their members, according to an academic from the University of Technology Sydney (UTS).

Gordon Noble, research director at the UTS Institute for Sustainable Futures (ISF), said AI is allowing super fund members to access greater information about their retirement savings. This information will help them make value-aligned informed decisions, particularly around areas such as climate and ESG decisions.

“Most Australians are passive when it comes to their super,” he explained. “But AI is changing that. It allows people to ask direct questions – like how much of their super is invested in fossil fuels – and get clear, immediate answers.

“AI is giving people the ability to ask complex questions that they couldn’t have asked before and to find complex answers about their super fund portfolio and understand what the impact of some of those decisions is. In the past, that was only something that the superannuation fund had access to but now AI has opened that up.”

This AI usage could have a clear financial impact if members opt to move their assets between funds in search of a better option.

“If members decide to move from passive to active, they now have the tools to do so and quickly. We could see billions of dollars shift in just a few months,” Noble said.

For super trustees, they need to be prepared that transparency on their funds is an essential feature, so they need to be able to articulate how their investments are aligned with long-term goals like the transition to net zero. 

“We expect superannuation funds to have a plan B around how they invest for the future,” Noble said.

Those funds that embrace this may be the ones that are positioned to retain trust and capital from their members.  

Speaking in April at the Australian Council of Superannuation Investors (ACSI) conference, both Vicki Doyle, CEO of Rest Super, and John Pearce, chief investment officer at UniSuper, said AI is no longer a distant horizon, but a transformative shift that is already reshaping the world.

“It is going to be core to changing our world,” Doyle said.