“So part of the role of the board should be to say that as individual members have oversight over their results, can we re-frame the results, not just in terms of looking back over the last 12 months of investments, but looking forward to their life outcomes at 65,” Ezra says.

“We can help the individual’s own oversight by changing the way we report.”

Re-framing reporting in such a way also puts into perspective short-term market volatility. It might also be possible to benchmark funds on how successful they have been on meeting their members’ desired outcomes.

While noting that the Australian superannuation system has been one of the most successful in the world during the accumulation phase, he says there are gaps when it comes to providing for the post-retirement needs of members.

Part of the uncertainty of ascertaining life outcomes for members is the problem of planning for longevity risk.

Ezra sees a major gap in Australia’s post-retirement planning around the question of annuities and the longevity protection these products provide.

“What retirees – and even professionals – don’t realise is that longevity uncertainty is even greater than equity-return uncertainty when you reach 75. So, what you ought to do is find some form of longevity insurance,” he says.

Ezra notes that the government is the most exposed to longevity risk, as it ultimately has to provide the aged pension to people who are living longer.

He says that policy discussions in this area should look at how the government can provide some form of insurance support for longevity risk.

Governments may also be able to lay off some of the risk through providing a market for some form of longevity swaps. Ezra points to the example of the United Kingdom, where this kind of system is already well developed and involves insurance companies and the government being able to pass on longevity-risk exposure to a third party.

“These are all thoughts about how the market might develop in the future, as baby boomers start to get to maturity. These are discussions that in the next 10 years need to take place,” he says.