With Your Future, Your Super (YFYS) scheduled to apply to Choice superannuation funds from 1 July, Crescent Wealth, an Islamic based super fund, will seek an exemption on religious grounds.
Speaking to Super Review, Crescent Wealth founder, Talal Yassine, said the super fund has spoken with its trustee and had discussions with the Australian Prudential Regulation Authority and representatives from the Government and the opposition, including Senator Jane Hume, minister for superannuation, financial services and the digital economy and Labor’s financial services spokesperson Stephen Jones.
“What this would mean is that the performance of Crescent Wealth would be measured against an index determined by the regulator. We welcome accountability but the issue for us is that the benchmark we would be measured against would not be an Islamic investing index,” he said.
“Crescent Wealth invests in industries and companies that comply with Islamic guidelines. We do not invest in companies that produce, market and profit from alcohol, weapons, tobacco and adult materials that other super funds invest in.
“The Islamic investment approach means that sometimes our investment performance is different to conventional markets, although we tend to outperform in down markets. Our members understand this and strongly support our ethical and faith-based approach.
“We exist because we are different and Islamically compliant. For us to be measured fairly and for apples to be compared with apples we need to have our performance measured by an Islamic investing index.”
Yassine said Crescent Wealth will seek an exemption from the next stage of YFYS and asked that it was measured against an independent Islamic investing index appropriate for an Islamic super fund.
Yassine said he was “100% supportive” of Labor’s pledge late last year to allow APRA to take into account the religious affiliation of a super fund when applying the performance benchmark.
He said YFYS performance tests could present an existential threat to faith-based super if the Government de-legislated choice for Australian Muslims.
“But I am optimistic accommodations can be made that will resolve this issue. We will look with interest at what the next federal government will do in this space after the election.”
