ASIC has called out the trustees of four industry super funds for poor communications of the fund’s failure of the Your Future, Your Super (YFYS) performance test for the second consecutive time.
In a press statement on Wednesday, ASIC called out Australian Catholic Superannuation, BT Funds Management, Energy Industries Superannuation and Equity Trustees Superannuation for inconsistent and unclear communications to members about failing the test or merging with another fund. Australian Catholic Super signed an agreement to merge with UniSuper, which it completed last year.
“Trustees that fail the performance test need to get the balance right in their communications – they need to be transparent and factual about the performance of the failed product,” ASIC commissioner Danielle Press said.
The regulator found some trustees took a reactive approach to performance test communications or significant events such as mergers and did not have cohesive communications strategies in place.
Member experience under scrutiny
The review comes at a time when Minister for Financial Services Stephen Jones is pushing super funds to improve member experience including providing guidance to help them make good choices as they approach retirement.
ASIC also highlighted other areas for improvement including providing consistent messaging about performance across the fund website, as well as balanced communication about the short-term performance of the products and any merger activity and clear call-centre transcripts for staff to discuss the performance failure or product closure and related options with members.
The government last week proposed to expand the performance test beyond the default MySuper products to multi-option products.
“As the performance test expands to trustee-directed products, I strongly encourage trustees to assess their approach to member communications, reflecting on the suggested areas for improvement,” Press said.
“Trustees should bear in mind ASIC’s expectations for balance, prominence and clarity in their performance communications to members.”