Industry funds hypocritical on vertical integration



Industry superannuation funds were guilty of hypocrisy when they attacked the vertically integrated nature of financial services companies, according to Fiducian head platform services, Patrick Jackson.
Jackson told the Fiducian annual conference on Friday that while industry funds had been attacking vertical integration for a long time, this overlooked the vertically-integrated nature of their own operations.
"Industry funds are as vertically-integrated as anyone else," he said.
Jackson also questioned the validity of the industry funds' advertising campaign, arguing that while they had been allowed to advertise to create scale, this had not necessarily been translated into lower fees for industry fund members.
"There advertising campaigns are pretty negative and I believe they are designed to kill off competitors," he said.
However Jackson said he believed attacks on business models were misconceived.
"The problem is really not business models," he said. "The problem resides in issues such as poor compliance, sales culture, poor administration and improper remuneration structures."
Recommended for you
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
Having reset its market focus to high-net-worth advisers, Praemium’s administration solution has been selected by Bell Potter in a deal that increases the platform's funds under administration by $6 billion.
High transition rates from financial advisers have helped Netwealth’s funds under administration rise by $3.7 billion in the fourth quarter of FY25.