Corporate hospitality regrettable but necessary says Hostplus
Hostplus spent $250,000 on entertainment at the Australian tennis open this year and the fund’s chief executive, David Elia has told the Royal Commission he wishes the expenditure had not been necessary.
However, he told the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry that the expenditure had been necessary for Hostplus to retain its membership in a competitive market.
“It is a competitive market and there are relationships to be maintained,” he said. “We have lost business where relationships have not existed and we are not the only industry funds that embarks on corporate hospitality.”
Elia described the tennis open as a flagship hospitality event, and the Hostplus chief executive said that in a marketing budget of $100 million, the $250,000 represented only 24 basis points.
Asked whether it concerned him that the fund had to undertake such expenditures, Elia said it did concern him and that he wished it were not necessary but it was necessary to retain membership and deliver scale benefits.
Royal Commissioner Kenneth Hayne whether what Elia meant was that investment performance was not enough with the fund CEO agreeing that was the case.
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