A key architect of the compulsory retirement savings system lauds its many achievements, stretching from the national economy to the individual. Where it’s double faulting is in serving members – and it needs to be addressed promptly.
With performance and diversification driving demand, these funds are expected to experience four-fold global growth over the next decade to nearly $AU65 trillion.
Key themes for super funds: behind the Chant West Awards
(pictured: Warren Chant)
Continued low investment returns from an expanding asset pool – likely to double in size over the next five years – are two of the dominant themes behind the selection of winners among super funds at this year’s Chant West Super Fund Awards, to be held in Sydney on May 4.
Warren Chant, Chant West director and co-founder, said that in assessing the funds across the Awards’ 12 categories, the research firm tried to identify key themes which shaped their behaviour and then select those funds which had responded best to those themes. The four key themes this year are:
- Low returns. How to respond to a low-growth, high volatility environment that looks like it may persist for several years. Funds need to anticipate the possibility that they may fall short of their risk and return targets over the next few years, Chant says. So, apart from dealing with the pure investment challenges, they also need to think about managing their members’ expectations so as to avoid disenchantment.
- Expanding asset pool. Even if we’re in for a period of low returns, the continuing flow of mandated contributions is expected to double the total funds under management over the next five years. For the larger funds, in particular, what challenges and opportunities arise as a result of their ever-increasing scale?
- Member communications. Increasingly important is how funds can better engage with their members using digital media. The better funds are those that put themselves ‘in the shoes’ of their members, Chant West says. They talk to them in ways they can relate to about how to progress from where they are now to achieving at least an adequate retirement income. Technology has opened up great opportunities to communicate in ways that are second nature to certain demographic groups, and making good use of those new channels can dramatically improve the relationship between funds and their members.
- Insurance. Group insurance has been transformed in recent years. It’s no longer a standard commodity to be bought at the lowest price. Instead, funds now have the opportunity to manage the trade-off between premium levels, the adequacy and relevance of insured benefits and the conditions that apply to them. The aim is to provide value for money, and to ensure that benefits go to the people who really need them. As part of the re-think of insurance, some funds are becoming more proactive in identifying potential claims and taking steps to intervene in the process, such as providing rehabilitation and retraining services.”
The 12 Awards categories are:
- Super Fund of the Year
- Pension Fund of the Year
- Specialist Fund of the Year
- Corporate Solutions Fund of the Year
- Advised Product of the Year
- Asset Consultant of the Year
- Best Fund: Investments
- Best Fund: Member Services
- Best Fund: Insurance
- Best Fund: Innovation
- Best Fund: Integrity
- Best Fund: Longevity Product
Key criteria weightings used in the main categories are: investments, 35 per cent; member services, 25 per cent; fees, 15 per cent; insurance 10 per cent; administration, 10 per cent; and, organisation, 5 per cent.
The winners will be announced at a black-tie dinner being held at the Ivy Ballroom. Last year, tickets sold out to the event well beforehand. For information go to: www.chantwestawards.com.au.
