POWERED BY MOMENTUM MEDIA
Not enough oversight on outsourced intrafund advice
Superannuation executives have warned super funds to implement more oversight of intra-fund advice and superannuation advice from associated planners to combat risk.
Speaking at an Association of Super Funds of Australia (ASFA) lunch, Superpartners executive general manager for corporate services Lucienne Layton suggested that there needed to be more hands-on monitoring of intrafund advice if super funds outsourced it to planning practices.
"Speaking purely as a risk manager, if I was outsourcing advice, I would want to see a lot more hands on monitoring than I have generally seen across the financial services industry as a professional services consultant," she said.
Super funds faced the risk of not knowing exactly what was going on when intra-fund advice was being provided, and whether that advice given was the right advice and appropriate for a fund's members, Layton said.
Head of risk and compliance at Qantas Super Hugh Loughrey suggested there was structural risks around outsourcing superannuation advice functions.
Conflicts of interest and the provision of best interest duties presented a number of challenges, Loughrey said, while there was also the possibility of reputational risk for the super fund.
"It's a very individual decision for the trustees who have their own circumstances," he said, depending on what level of conflict or control they wanted.
"That might influence the outcome around their attitude towards how do you balance that relationship," he said.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
The profit-to-member super fund’s MySuper default option has returned 9.85 per cent for the financial year 2024–25.
Colonial First State (CFS) has announced solid double-digit returns for its MySuper balanced and growth equivalent funds during the financial year.
The super fund’s Future Saver High Growth option delivered an 11.9 per cent return for the financial year 2024–25, on the back of a diversified portfolio and actively managed investment strategy.
HESTA has delivered a 10.18 per cent return for its MySuper Balanced Growth option in the 2024–25 financial year, marking the third consecutive year of returns above 9 per cent for the $80 billion industry fund’s default investment strategy.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
92.15 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
53.24 3 y p.a(%)
3
Global X GlobalX FANG+ ETF
43.15 3 y p.a(%)
4
DomaCom Shoreline North Coogee
36.26 3 y p.a(%)
5
GAM LSA Private Shares AU I
35.87 3 y p.a(%)
