A raft of superannuation providers and representative bodies have welcomes the proposed changes to superannuation board governance claiming it would boost consumer confidence around superannuation.
However Industry Super Australia (ISA) had questioned why it appears industry funds are being targeted with ‘one size fits all’ governance arrangements while claiming the Federal Government has no mandate to make the change.
Among the groups who have welcomed the change NAB Wealth Group Executive and MLC chief executive Andrew Hagger the reforms would strengthen the super sector and allow it to provider better returns for fund members.
His view was echoed by BT Financial Group, General Manager, Superannuation, Melinda Howes who stated that “good governance provides members with greater confidence that board decisions are made in their best interest”.
Howe also said super funds were obligated to attract the best talent to their boards and with increasing numbers of independent trustees there would be competition for positions.
Financial Services Council chief executive Sally Loane said the change had been recommended by reviews under Labor and Liberal governments and independent directors “will ensure that the interests of consumers are put ahead of the interests of shareholders or a sponsoring organisation”.
SMSF Association chief executive and managing director Andrea Slattery said independent directors and an independent chair were critical to improving the governance of all superannuation funds and its importance could not be overstated given the increasing size of the superannuation savings pool.
However ISA has stated that while it strongly supports good governance in super it “questioned why the most significant changes are reserved for successful not for profit super funds”.
ISA deputy chief executive Robbie Campo said “it is astounding that anyone would be seeking to interfere with the governance model of the “all profits to members” super funds that have driven two decades of strong returns for members”.
“The watchful eyes and questioning minds of industry super fund directors have not only delivered the best performing funds, they have avoided the widespread consumer losses and scandals which have engulfed the major banks and wealth managers over recent years.”
ISA chair Peter Collins, a former NSW minister and treasurer, said the extent of the changes in the proposed governance model had not been raised prior to the last election and thus the government did not have a mandate for the changes.
