POWERED BY MOMENTUM MEDIA
Will super funds face a dearth of directors?
The narrowing of the definition of “independent” in the context of directors on superannuation fund boards will serve to narrow the pool of available independent directors, according to industry superannuation fund REST.
In its submission to the Senate Economics Legislation Committee inquiry into the legislation underpinning changes to super fund governance arrangements, REST has sought clarification of the meaning of “independent” especially in the context of employer sponsored directors.
In doing so, the fund said superannuation was a specialised financial product with its own prescriptive legislation and rules and accordingly, directors had to have a higher threshold of knowledge requirements to satisfy the fitness and propriety test.
“As a result, the pool of superannuation trustee directors compared to the pool of non-superannuation fund directors is more limited,” the submission said.
“By having overly prescriptive requirements, this pool is narrowed further, making it difficult for superannuation funds to find appropriate independent directors that meet all of the independence requirements.”
The submission said this would be further complicated by all super funds going through the same process at the same time, competing with each other as well as other non-superannuation funds to achieve their required quotas.
“Flexibility from the regulator relating to timing of the appointment of independent directors to super funds may be necessary as this will be an industry-wide problem” it said. “It should be a period longer than the standard 90 days.”
Recommended for you
AMP’s strong 2024–25 returns were anything but a fluke – they were the product of a carefully recalibrated investment strategy that began several years ago, when the fund first became truly cognisant of its shortcomings.
ASIC is “considering what options” it has to hold super trustees to account for including the failed schemes on their platforms, according to its deputy chair.
Vanguard Super has reported strong returns across most of its investment options, attributed to a “low-cost, index-based approach”.
The fund has achieved double-digit returns amid market volatility, reinforcing the value of long-term investment strategies for its members.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom 465 Calder Road Calder
99.46 3 y p.a(%)
2
DomaCom DFS Mortgage
95.46 3 y p.a(%)
3
Global X 21Shares Bitcoin ETF
78.55 3 y p.a(%)
4
BetaShares Crypto Innovators ETF
50.39 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
47.50 3 y p.a(%)
This is amusing, first independent directors aren't needed, now there won't be enough of them anyway. I would argue independent directors would have more financial industry experience than any union representative on a Trustee board.