Australian superannuation funds need to assert themselves over funds managers, according to the chairman of the Cooper Review, Jeremy Cooper.
Addressing the Association of Superannuation Funds of Australia (ASFA) conference, Cooper claimed the funds management tail was wagging the super funds dog.
He said this was evidenced by the ambiguity and lack of accountability inherent in existing pre-tax fees structures.
Cooper questioned why super trustees, who controlled the capital, had not asserted themselves on fees.
He said this lack of assertiveness suggested they were captive to the agents and service providers.
Cooper said it was also demonstrated by the degree to which investment was dominated by a formula drawn up by the Investment and Financial Services Association.
Cooper referred to a hypothetical Australian super industry made up of just 27 funds, with the largest having $200 billion in funds under management and the smallest $50 billion — something that would allow them to own assets outright.
He offered the Canadian funds bidding to own Transurban as an example of how this might work.
Cooper said he believed super funds needed to assert themselves as being at the top of the investment food chain.
