POWERED BY MOMENTUM MEDIA
Executive directors problematic on retail fund boards
Retail superannuation funds should steer clear of appointing executive directors, according to Superannuation Consumers' Centre (SCC).
The SCC has used its submission to the Financial System Inquiry (FSI) to argue that the inclusion of executive directors is not "consistent with the duty directors owe to members.
"Executives are more likely to be focused on the short term interests of the business rather than the longer-term interests of members," the submission said.
"We also think retail fund boards should include directors with proven expertise in member/consumer issues".
The SCC was established was established by consumer group Choice in 2012 and, elsewhere in its submission, states that it supports reform of super fund governance and support the broad approach in the ASX's Corporate Governance Principles, with the exception of the majority independent director approach.
It said with respect to the composition of superannuation fund boards it supported the one third, one third, one third approach for industry funds recommended by the Cooper Review.
"It is our assessment that the stakeholder model has delivered value for members to date and we are not aware of evidence to the contrary," the submission said.
"By contrast recent research reflecting on the impact of the 2003 ASX rules requiring listed companies to have a majority of independent directors suggests independent directors have tended to lack relevant industry experience and understanding and have driven dramatic pay increases," it said.
Recommended for you
In its pre-election policy document, the FSC highlighted 15 priority reforms, with superannuation featuring prominently, urging both major parties to avoid changing super taxes without a comprehensive tax review.
The Grattan Institute has labelled the Australian super system as “too complicated” and has proposed a three-pronged reform strategy to simplify superannuation in retirement.
Super funds delivered a strong 2024 result, with the median growth fund returning 11.4 per cent, driven by strong international sharemarket performance, new data has shown.
Australian Ethical has seen FUM growth of 27 per cent in the financial year to date.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
32.68 3 y p.a(%)
2
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.72 3 y p.a(%)
3
Spire Oaktree Opportunities XI First Close USD
31.36 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
29.60 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
27.64 3 y p.a(%)
