Members must be at heart of merger decisions
The Royal Commission’s final report has reinforced that members’ best interests must be the determining factor in any considerations of superannuation fund mergers, after more than one fund in the last year has faced criticism over decisions not to merge.
“The determining question cannot be whether one or more of those who are directors before the merger will have a place on the new board,” Royal Commissioner Kenneth Hayne wrote.
He pointed to the case studies considered during the Commission as showing some recurring issues arising in this regard when possible mergers were considered by funds.
“In particular, the evidence pointed to processes related to board composition of the merged funds as being important to the success or failure of some merger proposals,” the report said.
“Likewise, care must be taken when considering whether proposals about board nomination and selection procedures for the board of the new entity are assessed according to the interests of members, or the interests of shareholders or nominating organisations of the merging trustees.”
Hayne reinforced that trustees of registrable superannuation entities (RSEs) offering MySuper products must determine annually whether the fund has sufficient scale to ensure that the financial interests of beneficiaries weren’t disadvantaged relative to those in other RSEs’ MySuper products, and that such a scale assessment should invite attention to the question of mergers.
Recommended for you
The ATO has revealed nearly $19 billion in lost and unclaimed super, urging over 7 million Australians to reclaim their savings.
The industry super fund has launched a new digital experience designed to make retirement preparation simpler and more personalised for its members.
A hold in the cash rate during the upcoming November monetary policy meeting appears to now be a certainty off the back of skyrocketing inflation during the September quarter.
The peak superannuation body has announced the appointment of Peter Chun, CEO of UniSuper, to its board of directors.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
215.17 3 y p.a(%)
2
Loftus Peak Global Disruption Fund Hedged
118.15 3 y p.a(%)
3
Global X 21Shares Bitcoin ETF
75.00 3 y p.a(%)
4
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
61.11 3 y p.a(%)
5
Global X Ultra Long Nasdaq 100 Complex ETF
60.93 3 y p.a(%)
