Leaders of profit-to-member superannuation funds have been urged not to squander the high levels of public trust the sector enjoys and to keep fighting for the rights of workers over the interests of the elite.
Australian Institute of Superannuation Trustees acting chief executive Eva Scheerlinck sounded the rallying call in her opening address to the peak body’s Conference of Major Superannuation Funds 2017, taking place on the Gold Coast, March 22-24.
“As we face a new onslaught of attacks on the fairness and purpose of superannuation this year, we must all continue to build trust in our sector, ensure consumers have confidence in profit-to-member funds to do right by them, and make sure they know the difference between those funds set up only to profit members and the funds that are not,” Scheerlinck said.
“Our strong example can only serve to encourage other institutions to restore a balance for the regular person, away from the perceived, or actual, bias of the rich and powerful, and as we Australians like to say, give everyone a fair go.”
AIST is the peak body representing industry, government and corporate superannuation funds. The theme of Scheerlinck’s speech was the importance of fostering trust in the superannuation sector.
She quoted international research by consulting firm Edelman, which showed public trust in institutions is in crisis around the world, and compared that with local research indicating about 69 per cent of Australians have trust in profit-to-member super funds to do right by members.
Profit-to-member super funds are at a distinct advantage to their retail rivals when taking on the challenge of restoring public trust, Scheerlinck said.
“Members are already at the core of our decision-making,” she explained. “The whole universal superannuation system was created to provide greater fairness and equity to all Australians, regardless of their job, their employer, their income or their gender.”
Scheerlinck pointed to the swathe of scandals to hit the retail banking and financial planning sector, warning that profit-to-member funds should be careful to avoid their sector being tainted by similar problems.
“We need to be vigilant that the proliferation of scandals in our banking sector doesn’t taint the whole financial services industry, and that the sector of superannuation funds run to profit members reinforces its point of difference at every opportunity,” she said.
“We have a duty to ensure confidence in the superannuation system: to preserve workers’ capital for the long term. We cannot take as given that all consumers understand the structural difference between a fund that reverts all profits to members, and a fund that has a corporate parent providing profits to shareholders – and the long-term impact of that difference on the members’ retirement savings.”
Cate Wood named AIST Trustee of the Year
Scheerlinck went on to predict a busy year ahead for the sector, in which the pace of regulatory change is not expected to abate.
“We are living in interesting, if not extraordinary, times. The reform agenda for Australia’s superannuation system is again packed this year, with items on the government’s agenda having the potential to fundamentally change our industry and detract from the value derived from a working life [spent saving by] your members,” she said.
CareSuper chair Catherine ‘Cate’ Wood, who also chairs advocacy group Women in Super and was the founding chair of the Mothers’ Day Classic, was named AIST trustee of the year.
“As a former union official, I’ve always had a passion for looking after working people…super is one of the great achievements of the union movement in helping ensure that ordinary workers get to enjoy a decent standard of living in retirement,” Wood said.
In accepting her award Wood also encouraged delegates to rise to the challenge of advocating for the profit-to-member super industry.
“At times it is depressing because it feels like we are doing it in the face of unending criticism and attempts to undermine what we do. This year will be no different, we just need to gird our loins and get back into it.”
To read all our coverage from Day One of CMSF, click here.