The Success of Representative Governance on Superannuation Boards report, produced by the Australian public policy researcher the McKell Institute, concluded there is “no evidence” supporting the Abbott government’s intentions to mandate independent directors onto industry superannuation fund boards.
McKell Institute executive director Sam Crosby said the 25 years of statistical evidence and empirical data within the report instead indicated superannuation funds governed by a board of directors consisting of representatives and employee bodies have actually outperformed for-profit-appointed trustee competitors on virtually all important criteria of superannuation performance.
“If the goal is maximising retirement savings for Australians then the model most closely aligned to satisfying it is the one used by industry super funds,” said Mr Crosby.
“The report ends up asking one very worthy question – when a system is working better than the alternative, why tamper with it?”
Mr Crosby said while there is plenty of room for reform across the super fund industry, it would seem “misguided in the extreme for the federal government to fixate on fixing one of the areas [that is] actually delivering”.
“The federal government should hold off on mandating reform in this area without providing strong evidence in favour of such a change,” he said.
“The trillions of dollars of Australian’s retirement savings are far too important to our future to jeopardise with ideological dogma.”
Industry Super chairman Peter Collins commended the report, arguing that “pragmatism and evidence should trump preconceived ideological positions”.
“This report adds a thorough and important body of evidence to the debate,” said Mr Collins.
He said industry funds have provided an “excellent example of how employer and employee representatives can work cooperatively to deliver for Australians”.
“When we get these stakeholders engaging harmoniously there is bound to be a positive result and that is what this report has proven beyond doubt,” he said.
