Royal commission update from the CE
The final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry was handed down last week after almost a year of hearings and deliberation.
As many of you may already know from the media coverage, the Royal Commission report is very critical of Australian banks, retail super funds, financial advisers, insurance companies and mortgage brokers.
The final report contains 76 recommendations. Nine of these directly concern super and are primarily directed at the for-profit super funds. In addition, 24 cases involving misconduct by banks and other for-profit entities have been referred to the regulators for possible criminal or civil charges.
A strong theme of the report is that regulators should do more to enforce existing laws and take stronger action against profit-driven entities that put the interests of shareholders ahead of members.
Commissioner Hayne commented that, in almost every case, misconduct identified was driven by businesses pursuing profit and individual greed. Providing service to customers came second and there is a need to change the culture within the financial services industry to ensure interests of clients are put first.
The government and opposition have agreed to take action on the vast majority of the Commission’s recommendations. However, because changes need to be legislated, any impact on members is some time off.
Super SA is a not-for-profit fund
It is important to note that Super SA is a not-for-profit public sector super fund. The recommendations will have minimal impact on our members because we have never paid commissions to financial advisers or used hawking to sell superannuation products. However, we may be affected by legislative changes and need to keep a watch on a number of recommendations going forward, in particular in regards to our advice model and insurance offering.
During the Commission’s hearings, along with a small number of other funds, Super SA received a positive mention in relation to our work with Aboriginal and Torres Strait Islander members. Access to super by Aboriginal and Torres Strait Islander members had previously been identified by the Royal Commission as a significant issue.
Super SA has been taking good care of the super of SA Public Sector employees for over 110 years and we continue to be not only committed to meeting your needs but act in the best interest of members and do the right thing!
Being South Australia’s largest super fund with over 215,000 members means we have the scale to deliver low fees and relevant products for our membership. Your funds are managed by specialist investment manager, Funds SA. On a day-to-day basis, more than 100 staff administer your super and ensure that you’re kept up to date about all aspects of your superannuation and retirement benefits.
You can find more information about the Royal Commission, provided by AIST here.