Focusing on choice issues
The underlying theme of this year’s Association of Superannuation Funds of Australia (ASFA) national conference in Melbourne is ‘Commonwealth’, but by ASFA’s own admission much of the interest will be focused on the issues that have been generated by the new choice of superannuation fund environment.
The ASFA conference is being held as the industry superannuation funds and a number of the master trusts continue their advertising campaigns aimed at retaining and recruiting members, while two start-ups — Virgin Super and Maxsuper — ruffle feathers among not only the existing superannuation funds and master trusts, but also the financial planning community.
Reflecting the underlying tensions being felt within the superannuation industry, ASFA four weeks before the conference pointed to a debate to be held on the second day between the principals of the four agencies who make a practice of rating Australia’s major superannuation funds and master trusts — Jeff Bresnahan from SuperRatings, Warren Chant from Chant West, Alex Dunnin from Intech and Wayne Walker from Rice Walker.
In the words of the ASFA media release, “sparks are sure to fly” as the four principals give their views and then their methodologies are assessed by ASFA’s Principal Researcher, Ross Clare.
“The criteria and features utilised by the ratings agencies can be controversial, and choice of fund raises the stakes for consumers and the industry alike,” the ASFA promotional material said.
What makes the debate really interesting, however, is that Chant and Bresnahan are being seen as holding some of the opposing views reflected in the approaches adopted by the Investment and Financial Services Association (IFSA) and Industry Fund Services.
Chant made those views clear at the IFSA national conference in August when he suggested that the “net benefit to members” calculation being utilised by the industry superannuation funds could be misleading — something that prompted the executive chair of Industry Fund Services, Garry Weaven, to threaten to refer Chant’s claims to the Australian Securities and Investments Commission.
Bresnahan is expected to have to defend the “net benefit to members” methodology because the industry fund advertisements are largely based on data compiled by SuperRatings.
What delegates to the conference are likely to find interesting is Clare’s independent assessment of their methodologies, particularly in circumstances where he has signalled that he will be pointing out their strengths and weaknesses.
AUTHOR
Mike Taylor
Recommended for you
In this episode of Relative Return Unplugged, hosts Maja Garaca Djurdjevic and Keith Ford are joined by special guest Shane Oliver, chief economist at AMP, to break down what’s happening with the Trump trade and the broader global economy, and what it means for Australia.
In this episode, hosts Maja Garaca Djurdjevic and Keith Ford take a look at what’s making news in the investment world, from President-elect Donald Trump’s cabinet nominations to Cbus fronting up to a Senate inquiry.
In this new episode of The Manager Mix, host Laura Dew speaks with Claire Smith, head of private assets sales at Schroders, to discuss semi-liquid global private equity.
In this episode of Relative Return, host Laura Dew speaks with Eric Braz, MFS portfolio manager on the global small and mid-cap fund, the MFS Global New Discovery Strategy, to discuss the power of small and mid-cap investing in today’s global markets.
