Super funds will find it easier to provide guidance and advice to members under regulatory reforms announced by the Minister for Financial Services Daniel Mulino. Trustees who breach their obligations will also be required to remediate members for losses, and the government will crack down on predatory lead generation.
A year after regulators put super funds on notice about the unacceptable gap between the best and the worst of responses to the Retirement Income Covenant, the situation has become even worse. The Retirement Leaders Summit in Canberra heard that the leading funds treat retirement as a core business, while the laggards still see it as a compliance exercise.
Minister for Financial Services Daniel Mulino will unveil the government’s response to the Shield and First Guardian incident and “harmful lead generation” in the super system in a milestone address to the National Press Club on Wednesday. Among a suite of new regulatory measures, the government is expected to introduce a ban on “real time” super communications issued by unregulated entities.
The super industry wants a central role in the retirement system of the future, but its pitch will only be as credible as what it delivers for the millions of members retiring now – a tension that will be front and centre at the Retirement Magazine Retirement Leaders Summit.
JANA’s implemented consulting business has grown to $18.8 billion, powered by new mandate wins from insurers, universities and charities, just as rival Frontier Advisors readies a competing solution aimed at the very same clients.
Roger Urwin, one of the industry’s most well-known proponents of TPA, has defended it against the growing scepticism of its reported performance edge over SAA, saying “TPA is a system” and any performance attribution is difficult to isolate from the broader context each fund operates in.
With the super industry facing into headwinds that raise the floor on minimum scale and increase complexity, the pressure towards further consolidation should ultimately prove unstoppable, and a natural end-point could be ten mega-funds over $200 billion in size managing more than 90 per cent of system assets. The path to that destination, however, could be bumpy.
Australian Retirement Trust says banning advice fee deductions from members’ accounts would deny members access to a service the fund believes leaves them better off.
The forces currently shaping fixed income markets are fundamentally different to those of the post-GFC era creating both opportunities and challenges for investors. Asset owners are once again turning their attention to this foundational asset class, with its enduring relevance as part of a diversified portfolio. Investment Magazine in partnership with T. Rowe Price recently assembled leading investment experts to discuss the evolving role of fixed income in building resilient portfolios; the case for active management and customisation; and the AI and hyperscaler opportunity.
The nation’s largest superannuation fund has heeded the call of regulators to lift its risk appetite and embark on personal financial advice to members. Even with the counsel of top lawyer Michelle Levy, the megafund will find it challenging to navigate the complex advice laws as they stand, but its bullishness is likely a positive sign for the future of advice reform.
The Future Fund’s new position paper is useful for anybody trying to imagine the possible futures of our increasingly wild present, but it is the AI threats that are already emerging that investors should spend their limited attention budget on.
A geostrategic standoff between the US and China over AI would be “extremely damaging for capital owners” according to the $337 billion Future Fund, which outlined four “secular scenarios” around AI and its investment implications in its latest position paper.
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