Equip is one of the first to bring a post-retirement product, MyPension, to the market, to appoint a women, Danielle Press, from outside the “traditional industry” as CEO, and it has innovated by setting up a unique partnership with AustralianSuper taking on their $700 million defined benefit business.
At the centre of this drive is Andrew Fairley, chair of Equip. His values and passions have inexorably pushed him to pursue intergenerational equity and environmental sustainability.
Fairley’s mother was a botanist and brought him up to act responsibly in everything he did, particularly when it came to maintaining the environment and safeguarding its integrity. She had a great respect for the indigenous people, whom she said knew how to manage the land.
“There is an intergenerational responsibility in there which has carried throughout my life,” Fairley said.
His mother was not the only person to instil these values.
“Because I never had a father, he died when I was only three months old, there were males in my life that played a significant role in shaping my values. Some of them were very successful Australian business men – they were people who were really rooted in values,” Fairley said.
One of the biggest influences was Richard Evanson. From 1985 Fairley created with Evanson a sustainable resort in Fiji called Turtle Island which was named as the world’s leading eco-lodge in 2000. The relationship between the two is so close that Evanson is god-father to Fairley’s children.
“We created from nothing an organisation that on every level had a commitment to environmental integrity, engagement and benefit to the local people of Fiji, ensuring everything we did celebrated the heritage and culture of the place.”
“These are the events that shape your life and make you committed to the values that underpin the fiduciary duties that are so central to a successful superannuation fund trusteeship.”
Fairley started specialising in superannuation in the late ‘70s and early ‘80s as lawyer and found the field absorbing because it was an amalgam of tax, contract law, employment law and of equity.
The legal profession at the time was not really involved with the space which was dominated by accountants and actuaries.
“I’ve always been half-lawyer half-entrepreneur and I saw a real opportunity, but it was an opportunity based on a passion. So I developed my practice into super.”
Originally specialising in SMSFs he made the decision to act on behalf of trustees rather than employers and highlighted the conflict of interest many firms had at this time in representing both simultaneously. The creation of industry super in the ‘80s was a “merciful” event which lead, Fairley says, to him representing close to half of all industry funds at one point.
In 1993 Fairley went into a joint venture with Garry Weaven and Industry Fund Services, creating IFS Fairley, a law firm that was unashamedly for super funds – a first in Australia. He practiced with them for more than ten years until the bulk of the practice merged with Holding Redlich. It was at this point that he became more interested in being a trustee and a chair of a super fund and, in January 2009, he was appointed to chair of Equip, with his current term of office expiring in February 2016.
He sees Equip running three businesses: an investment business; an administration and insurance business; and an advice business. He believes there are opportunities to innovate in all of these areas, with initiatives running at the moment that he hopes “will bear fruit in the next six months”.
One of his goals is to acquire more scale either through mergers or smaller acquisitions to take Equip to the $15 billion “sweet spot”, with conversations already happening between small and medium size funds.
Advice was also mentioned as a critical aspect with Equip expanding its financial advice to have a “substantially enhanced skillset” in the next two to five years. Implementing Equip’s vision is the executive, with whom the board have just completed a skills matrix assessment. This has led the board to find two new executive appointments to address a shortfall in skills.
“Part of my responsibility is employing an outstanding operational manager, someone who is going to be strategic, but also who has the same sort of passion in their makeup for the outcomes that you want and retains currency in issues that are important.
“That’s one of the reasons we employed Danielle as chief executive in 2010.
“She had all of those aspects of an innovator that I believe are so critical to be successful in a time when we are experiencing change constantly.”
One of these changes is the amount of people moving into retirement as the baby boomers enter their later years. A quarter of Equip’s membership is over 50 and the fund has more than 100 DB schemes, presenting a challenge in providing membership with the best post-retirement options.
Fairley is committed to innovation as the best way of addressing this challenge, fulfilling his fiduciary duty through intergenerational equity and environmental sustainability.
