In this study we developed a disclosure index for Australian superannuation funds (superfunds) as well as an evaluation of the disclosure practices of these funds for the period between 2010 and 2016. This provided a thorough and rigorous evaluation of disclosure practice in order to best inform policy. We also investigated disclosure associated with the MySuper product, launched after the introduction of the ‘Stronger Super Reform’ in 2013 and targeted to be fully implemented by 1 July 2017.
Overall, we found that superfunds had succeeded in disclosing information related to their governance. Many superfunds have achieved full disclosure in the SuperGov Index. On the other hand, disclosure of fund fees and costs, and investment related information was mixed. Therefore, the level of disclosure, as measured by the SuperInvest and SuperFee Indices, remained limited for many superfunds. In addition, we also observed a fall in overall disclosure as measured by the SuperInfo Index in 2016 from its level in 2010. Industry superfunds and funds governed by not-for-profit trustee boards were the top performers in disclosing various categories of information, including the MySuper disclosure. On average, our sample superfunds have achieved approximately 68% of the 10 categories of MySuper product information in our index. We observed that some funds have achieved 100% disclosure of MySuper while others have not disclosed any information.
We make the following recommendations based on our observations in this study:
- Regulators and industry bodies should provide better clarity and a standardised framework for the disclosure of fund fees and costs, and investment related
- Future research to be conducted on how trustee governance affects superfunds disclosure besides the attention paid to the structure and composition of trustee boards.
This paper was produced under the ACFS Commissioned Research program, which supports academics to conduct practitioner-oriented research. Further details about the program and other ACFS research grants, are available here.