Industry superannuation funds need to make sure they learn from the mistakes of retail funds, and ensure that the dodgy governance practices uncovered in the latter by the Banking Royal Commission don’t seep into profit-for-member funds.
This was the message Australian Institute of Superannuation Trustees (AIST) chief executive, Eva Scheerlinck, passed on in her opening address at the Conference of Major Super Funds on the Gold Coast this morning.
She also noted that the “Royal Commission had an impact” on out-flows from retail funds, with their industry counterparts seeing record in-flows as both individuals and employers made the switch following “outrage” at the Commission’s discoveries. Scheerlinck encouraged industry funds to leverage this changing sentiment.
“While the Royal Commission hearings showed that retail funds failed profoundly on governance issues,” the CEO also said. “All of us need to be aware that the practices that became common in the retail sector could seep into the industry sector if they’re not careful, so funds needed to ensure they practiced good governance.
“Improving board governance doesn’t require a million dollars of spending on consultants or policy redrafting,” Scheerlinck told delegates, but rather needs trustees to know their funds and know their obligations under the Superannuation Industry (Supervision) Act.
“We don’t need more laws or regulation, we just need to remain true to our purpose and do what is right.”
It’s worth noting that in the aftermath of the Royal Commission superannuation hearings, many in the broader industry felt that Senior Counsel assisting the Commission, Michael Hodge QC, had let industry funds off lightly where governance and spending were concerned.