Speaking at the Finsia annual conference in Sydney yesterday, Ms Press compared the superannuation system to a “troubled teenager”.
She argued that the corporate structures, governance structures and skills within superannuation need to be improved.
“[The superannuation system] is improving – and it is improving pretty rapidly – but it’s also growing really rapidly. And there is a huge difference between some of the very small funds and some of the very large funds,” Ms Press said.
Overall, the sector is not much more than a “cottage industry” – and it has a “long way to go”, she added.
“The way we invest is still a little naïve, to be perfectly honest. I think the way that we’re starting to build teams within superannuation businesses is somewhat naïve as well,” she said.
Equipsuper was one of the first funds to manage investments in-house, and has done so for 15 years.
“Coming from an asset management business [background] I look at it and think we don’t invest in the systems, we don’t invest in the people, and we don’t invest in the governance structures,” Ms Press said.
“If we’re going to manage money in-house and we’re going to manage infrastructure in-house then we’ve got a long way to go.”
However, Ms Press said she was not discouraging funds from managing assets in-house.
For a large fund like AustralianSuper it would make “absolute sense” to manage some core assets internally, she said.
But managing assets internally also changes the business model of a superannuation fund, she warned.
“You’re no longer a manager of managers … you’re an asset manager. That changes the people, it changes the culture … and it changes the way you interact with your custodian,” she said.
She acknowledged that the superannuation industry needs to utilise the skills of other players in financial services.
“As an industry, we need to understand that everybody has a role to play in this,” she said. “Industry funds have taken a very hard stance against [the retail sector] and we’ve almost hated each other for many, many years – and at the end of the day we’ve got to stop doing that. We’ve got to start collaborating,” Ms Press said.
