C1 Superannuation Governance

Leah Fricke Pauline Vamos

20112011ANNUANNU

AL AL

CONFERENCECONFERENCE

20112011ANNUANNU

AL AL

CONFERENCECONFERENCE

28TH ANNUAL

CONFERENCE

2011

28TH ANNUAL

CONFERENCE

2011

Superannuation Governance

• Pauline Vamos• CEO ASFA

What is Superannuation Governance

• Fiduciary responsibility

• Acting in the members’ best interest

• Higher than ASX governance?

• Investment governance

Unique issues

• Equity between members

• Sole purpose test

• Cross sub-sidisation

• Different sector models have different issues

General Governance

• Prudent person to prudent business person

• Size, tenure, and diversity

• Fit and Proper

• Conflicts – multiple arrangements

• Independence-voting

Investment Governance

• investment strategy – portability, liquidity, long term (peer pressure)

• Default, target date and choice portfolios • Oversight of fund managers – cost and after

tax • In-house investing – new governance model • ESG and UNPRI• Post retirement – liability investing

Increasing Challenges

• MySuper-design, costing, transition

• Scale and sustainability as a fund

• Delivery of advice

• Insurance – tailoring design

Even more challenges

• Superstream – auto consolidation

• APRA Standards including data collection • Operational risk reserves

• Competition

• Mergers - DTAs

Trustee of the future

• Global pension fiduciary

• Business and investment savvy – influence on listed companies

• Many fiduciaries' outside pension industry

• Professional trustees?