Members let down by industry self-interest

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After almost 15 months of waiting for the arrival of the industry-fund sponsored report into Government legislation on the governance of superannuation funds, its key recommendation is that the status quo must be protected at any cost.

The Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer MP, said the report was a letdown for those in the industry who believe in the value of having independent directors on the boards of superannuation funds that control $2.1 trillion of Australians’ compulsory superannuation savings.

“Policies intended to improve the governance and accountability of superannuation funds have been in the public domain since 2010, but seven years and several governments later, the attitude of entrenching existing board structures and protected sinecures remains unchanged,” Minister O’Dwyer said.

“It is important to recall the initiative for improved governance and accountability of super funds began with the Cooper Review which was commissioned, delivered and ignored under a Labor Government.

“The Turnbull Government remains committed to legislation to improve the accountability of boards and member outcomes regardless of whether they are retail, industry or corporate funds.

“I am pleased that ISA and AIST have finally conceded to the release of Mr Fraser’s report, but it is a shame it has been exposed for what it always was, a lobbying document to kill off legislation that applies equally across the entire sector in December, 2015.”

“Mr Fraser’s report, released today, was co-sponsored by Industry Super Australia and the Australian Institute of Superannuation Trustees and was initiated as a delaying tactic to stop reforms to superannuation governance that have been in the pipeline since 2010.

“Given that it recommends adoption of the AIST’s draft code of governance which appears to at best entrench the status quo and at worst further dilute the value of independent directors on superannuation fund boards, what is clear from this almost 15-month review is that we could have had very reasonable independence requirements legislated since 2015.

“There is nothing in this report that negates the need for legislation to lift the standard of accountability, transparency and choice across the entire superannuation sector.

“I look forward to working constructively with the Opposition, the crossbench senators and my colleagues to ensure the Turnbull Government can deliver on its commitment to put members’ interests ahead of the self-interest in the superannuation sector.”