Hats off to the girls and guys at the Australian Prudential Regulation Authority (APRA) for exhibiting fancy footwork in avoiding a dangerous political crash-tackle in the form of a question about the governance and remuneration structures underpinning industry superannuation funds.
The crash-tackle was orchestrated by Tasmanian Liberal Party Senator, David Bushby during a hearing of the Senate Economics Committee when he asked about the remuneration of directors of the industry funds-owned eligible rollover fund (ERF) AUSfund and, in passing, the structures which gave rise to those director appointments.
APRA, as reported elsewhere in this edition of Money Management, confirmed that the directors were paid a combined total of $225,000 last financial year, some of which found its way back to Industry Super Australia (ISA), but what Outsider found most illuminating was the complex corporate structures which had been put in place by the industry funds.
Without ever once referring to complexity or structures, the APRA answer to Bushby’s loaded question stated:
“The rules relating to the nomination, appointment and removal of directors are determined by each registrable superannuation entity (RSE) licensee. According to the RSE licensee’s Constitution and Board Charter, directors of
Industry Funds Investments Ltd must also be directors of Industry Funds Services Ltd. The directors of Industry Funds Investments Ltd and Industry Fund Services Ltd are appointed by Industry Super Holdings Pty Ltd. This process is governed by a Directors Nomination Committee and a vote of the shareholders of Industry Super Holdings Pty Ltd.”
For the record, Outsider checked and Industry Super Holdings Pty Ltd is owned by 26 industry funds and Industry Super Australia operates under the umbrella of Industry Fund Services Ltd.
Good luck with unravelling that structure.
