Regulator identifies director links
The Australian superannuation fund industry appears to represent something of a goldmine for consultants and service providers, with new research conducted by the Australian Prudential Regulation Authority (APRA) revealing that the average fund uses at least 13 service providers.
What is more, a high proportion of directors of retail funds have connections to those service providers.
The data was collected as part of APRA research into the governance practices of APRA-regulated funds as part of a broader exercise aimed at determining the reasons for differing performance between fund types.
What the research found was that Australian superannuation funds tended to be generally well run, with trustee directors of the large funds typically well qualified, experienced and reasonably well-trained in their duties.
The research also found that 76 per cent of boards had both independent audits and regular self-assessment to review compliance with the relevant legislation and regulation.
However, when it came to service providers, the research uncovered the fact that not only were funds using at least 13 service providers, but that over 60 per cent of directors of retail funds had one or more associations with those service providers.
APRA noted that this was double the number of such associations for corporate funds and three times the number for public sector and industry funds.
It also found that almost half of all retail trustee directors were employed by related parties or by the fund itself, and very few were nominated by members.
AUTHOR
Mike Taylor
Recommended for you
Amid regulatory simplification, ASIC has outlined its efforts in making regulation clearer and accessible, as well as unveiled a roadmap for financial advisers on their obligations.
As advisers attempt to tackle mounting operational costs and achieve greater efficiency, the FY25 reporting season has revealed a growing focus on managed accounts among major firms.
Wrapping up the reporting season for the 2024–25 financial year, Money Management rounds up the results of Australia’s listed platforms.
Investment platform Praemium has announced an integration with fund services firm Clearstream’s platform into Praemium Spectrum, expanding advisers’ access to global funds and greater operational efficiency.
