Ethically-focused superannuation fund, Future Super has refused to reveal to a Parliamentary Committee how much it receives in rebates from exchange traded fund (ETF) specialist BetaShares for investing in its ETHI ETF.
Future Super, which was co-founded by political activist, Simon Sheikh, claimed it could not reveal the amount of rebates received from BetaShares because it was commercial in confidence, but claimed that when the rebate was taken into account it meant that Future Super members were paying less than if they had invested in the comparable Vanguard product.
What is more, Future Super claimed it preferred the BetaShares ETHI ETF because the Vanguard product held investments in companies which did not pass the Future Super negative screens.
The deputy chairman of the House of Representatives Standing Committee on Economics, Labor’s Andrew Leigh, had specifically asked Future Super the size of the rebate it received from BetaShares and what the fund saw as the advantage of being in a product such as ETHI rather than the comparable Vanguard product which he said “charges 18 basis points – less than half of the [what] the Betashares product charges”.
Future Super responded in a written answer to Leigh stating that “the specific quantum of the rebate paid by BetaShares to the Future Super Fund is commercial in confidence”.
“However, Future Super confirms that after taking into account the rebate, its members pay less than the Vanguard VESG product fee stated by Dr Leigh to invest in ETHI.”
“It is important to note that Vanguard’s VESG product is not a fully comparable product to ETHI, meaning the comparison of fees may be misleading. Future Super’s investment management team conducts annual reviews of a range of exchange traded funds (ETFs) in the market that claim to be ethically-focussed,” the Future Super response said.
“The VESG product states on its website that that excludes “companies with significant business activities involving fossil fuels, nuclear power, alcohol, tobacco, gambling, weapons, adult entertaining and a conduct related screen based on severe controversies”.