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SUPERRATINGS DAY OF CONFRONTATION 2014
Telstra Super nets SuperRatings
top fund award
By Wouter Klijn
Telstra Super last night won the
SuperRatings Fund of the Year award at
the twelfth annual SuperRatings awards
ceremony in Sydney.
The award recognises the fund that
has the best value end-to-end retirement
solution, including both accumulation and
pension products.
“In a constantly changing
superannuation environment, Telstra
Super has had an amazing year, performing
consistently well across all of SuperRatings’
key assessment criteria,” SuperRatings chief
executive Adam Gee said.
“This includes a long history of
outstanding investment returns, coupled
with competitive fees.”
The fund’s balanced strategy achieved a
return of 15.81 per cent over the 12 months
to 30 June 2014, while over a five-year time
frame the option returned 10.69 per cent.
It also took out the category of Super
of the Year, recognising the best value for
money accumulation product.
Finalists for this award included
CareSuper, Catholic Super, First State
Super, HESTA, Hostplus, QSuper, REST,
Sunsuper and UniSuper.
REST Pension won the category of
Pension of the Year, recognising the best
value for money retirement product.
Finalists for this award included
AustralianSuper, Auscoal Super, Catholic
Super, Energy Super, Hostplus, NGS Super,
Qsuper, Sunsuper and Telstra Super.
Best new product went to ANZ Smart
Choice Paperless Rollover Tool, while the
Rising Star Award went to Energy Industries
Superannuation Scheme (EISS).
EISS was rated as the leading fund
because of improvements in member value
driven by reduced fees, flexible investment
structures, and administration and member
education enhancements.
IOOF, MLC and REI Super were also
highly commended for the improvements
made to their funds, SuperRatings said.
The Rising Star Award recognises
the fund that has most improved its value
proposition to members in the past year.
The fund that recorded the
largest natural increase in funds under
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Crises: just live with them
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By Wouter Klijn
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Most super members would be best off
maintaining a high allocation to equities well
into their seventies, according to Hostplus
chief investment officer Sam Sicilia.
“If you were not concerned about
politics or marketing, you would have people
invested in much more aggressive equitytype strategies well into their seventies and
eighties, because by the time they get there
and medicine has its way, they are going to
be living until 110,” Sicilia said.
“I don’t support moving people away
management (FUM) in the past 12 months
was ANZ Smart Choice Super, which has
now grown to over $2.1 billion in FUM,
servicing over 330,000 member accounts.
SuperRatings said the vast majority of
funds across all sectors had been hard at
work improving their products, services and
overall value for money offered to members.
“Despite comments to the contrary, our
analysis shows that retirement adequacy
continues to improve for members, albeit at
a gradual pace,” Gee said.
The research covered more than 100
MySuper, 320 accumulation and over 170
retirement products in 2014 across all
major mainstream super funds.
SuperRatings has rated super funds for
12 years and of hundreds of funds rated
since it started the benchmarking service,
only a handful have achieved platinum
ratings each year.
“Just eight funds have achieved this
status up to this point in time, with Cbus,
CSC PSS Accumulation Plan, First State
Super, NGS Super, Telstra Super and Vision
Super added to this elite group in 2014,”
Gee said.
during their accumulation phase anywhere
from a growth strategy.”
He played down the risk of experiencing
returns in an unfavourable order, arguing
discussing such a risk was only possible in
hindsight.
“So what about sequencing risk? If
[members] did nothing [during the global
financial crisis (GFC)] they would have
copped the volatility ride down and benefited
from the volatility ride up,” he said.
“I think in the next few decades we will
have five or six GFC-type events. Just live
with it.”
SUPERRATINGS AND LONSEC: DAY OF CONFRONTATION
14 OCTOBER 2014, IVY, SYDNEY
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1: Adam Gee (SuperRatings), Jean-Luc Ambrosi, Paul Curtin and
Leigh Heyward (all Telstra Super). 2: Melannie Pyzik (QIC) and
Brendan O’Farrell (Intrust Super). 3: Lisa Cumberland (IFAA),
Andrew De Vries (Diversa Group) and David Woodard (IFAA).
4: Dr Keith Suter (Global Directions), Greg Alder (Greg Alder
Co) and Oriel Morrison (CNBC). 5: Tara Moss (author). 6: Jeff
Bresnahan (SuperRatings) and Ian Knox (Paragem). 7: Emilio
Gonzalez (BT Investment Management). 8: David Erdonmez
(Lonsec Research), Licia Heath (Ironbark Asset Management)
and Lukasz de Pourbaix (Lonsec). 9: Peter Costello (former
federal treasurer). 10: Nathan MacPhee (SuperRatings). 11: Dan
Campbell (BT Investment Management), Vy Pham (BT Financial
Group), Jeremy Dean (BT Investment Management) and
Rebecca Riant (Westpac Institutional Bank). 12: Jeremy Gordon
(Challenger), Chris Clayton, Andrew Mouat (both BT Investment
Management) and Greg Hansen (Challenger). 13: Charles
Genocchio (Vinva Investment Management), Peter Lambert
(Local Government Super), Dascia Bennett (NGS Super) and
Doug Carmichael (Commonwealth Bank Group Super). 14: Alex
Hutchison (EISS). 15: Tom Sammann (Catholic Super) and Steve
Grant (Auscoal Super). 16: Robyn Petrou (Energy Super).
SUPERRATINGS DAY OF CONFRONTATION 2014
Costello calls for more focus on retired members
By Wouter Klijn
Former treasurer Peter Costello has
called on the superannuation industry
to spend more time thinking about its
members, especially what happens to
them when they transition to retirement.
At the SuperRatings Day of
Confrontation in Sydney on Tuesday,
Costello argued there was too much focus
on contribution levels during accumulation
and not enough on the end benefits that
finished up in members’ pockets.
“What I find remarkable about the
industry is that it doesn’t put nearly enough
time into the benefits; what actually ends
up in the hands of people,” he said.
“Not just during the accumulation
phase, there is a lot of interest there, but
during the retirement phase.
“We kind of lose interest in people
when they turn 60 or 65, when they are no
longer accumulating. It is not our business
anymore.”
But for members this is actually
the time they fully engage with their
superannuation.
“For the people for whom this industry
exists that is what really matters: what
happens at 65,” Costello said.
“What product am I going into? What is
my annuity going to be? What is my pension
going to be? What is my clawback on the
age pension?
“It is almost as if the industry has lost
interest, because you are no longer bringing
any cash flow into our fund.
“But from a person who is in the system,
this is where superannuation really gets
interesting: when they retire, not when
they are still accumulating.”
But he did not just blame the industry.
“I confront you as an industry, but I
think the government has not nearly paid
enough attention to this. The point is the
benefits, contributions are only a means to
an end,” he said.
The theme of the SuperRatings
conference was “What about me?” and
Costello had a very simple answer to that: it
is not about you, it is about the member.
Third-party advisers part
of service solution
Impact investing
chases sustainable
profits
By Elizabeth Somerville
By Elizabeth Somerville
With the average member-to-adviser
ratio of a not-for-profit super fund sitting
around 20,000 to one, a huge opportunity
existed for financial advisers and
industry super funds to work together
for the benefit of members, Lonsec Fiscal
Holdings joint chief executive Nathan
MacPhee said yesterday.
“It still shows that the average not-forprofit fund, even if it doubles, triples its
adviser capability, is never going to have the
scale to be able to service all its members,”
MacPhee told the SuperRatings Day of
Confrontation in Sydney.
“Even the best not-for-profit fund has
an adviser-to-member ratio of around about
one to 3000, so that’s still going to be about
10 times the average financial adviser’s level
of relationship.”
To successfully service the large number
of members within industry super funds,
relationships with third-party advisers
needed to be developed or not-for-profits
could risk losing members, he said.
“I always see industry funds liaising with
advisers as a retention opportunity,” he said.
“If you look at the top four industry
funds in this country, they have 6 million
members; that’s half of the workforce.
Those funds are never going to have the
scale to service those members.
“They need to develop those
relationships with third-party advisers.”
FPA chief executive Mark Rantall said
involving a financial planner would ensure
individual member needs were serviced
appropriately.
“If an individual wants personal advice,
they must be referred to a professional,
qualified financial planner who is acting in
their best interests,” Rantall told delegates.
MacPhee said putting members first
benefited both financial advisers and
industry super funds.
“Everyone will benefit from interacting
and putting the members first,” he said.
Impact investing is reshaping the way
consumers think about ethical investment
funds by allowing firms to choose
rather than exclude investment product
opportunities.
“[Impact investing] is doing good in
the community and not just excluding
[investments],” Christian Super chief
executive Peter Murphy said of this
approach to investment options.
“What we’re really trying to do is get a
good return and make a social impact.”
Impact investment opportunities
include options as diverse as sustainable
agriculture, microfinance, microinsurance,
renewable energy and community
projects, all of which are currently used by
Christian Super.
“It’s a new area, but it’s the same
theme [as other investment approaches]:
getting a good risk adjustable return, being
sustainable and making it profitable,” he said.