Australian superannuation fund trustees should prepare for a “potential flood” of new regulations out of the US in the wake of the financial crisis, according to Frank Gullone, managing director of the Centre for Investor Education (CIE).
Gullone said these new regulations will require compliance from any Australian-based super funds with investments in the US market.
This will inevitably require much more focus from Australian-based super funds on being able to demonstrate better governance and risk management processes associated with investments, he said.
“It is going to place a lot more pressure on trustees in respect of the oversight of their funds.”
Gullone said a “positive aspect” to come out of the financial crisis is that governance and risk management are now being looked at equally alongside portfolio returns by Australian super fund trustees.
“I think that previously the returns on the portfolio took up most of the thinking of funds trustees, and the governance and risk management wasn’t as important.”
