CEDA member profile: AustralianSuper




Rose Kerlin,
Group Executive Membership, AustralianSuper

What do you think is unique about AustralianSuper?

AustralianSuper’s size, scale and trusted brand make it unique in the financial services landscape in Australia. The Fund is able to leverage its scale to access investment opportunities for members that other funds may not be able to. This has helped to build a strong, diversified portfolio that is well placed to help deliver members their best possible retirement outcome.

Underpinning this is the ethos that every action we take and decision we make is done through the prism of one simple question: is this in the best interest of our members?

From your perspective, what are the most important trends shaping the superannuation industry at the moment?

Without doubt the most important trends relate to the reforms coming out of the Productivity Commission’s report into super and also the Hayne Royal Commission. The Productivity Commission found that while the vast majority of people were being well served by the superannuation sector there are still far too many people in funds that are underperforming. No working Australian should be in an underperforming fund and I think that we will see significant steps to address this in the near future. Certainly, APRA’s recent decision to produce ‘heat maps’ of each MySuper fund is a move in the right direction, but we’d like to see this approach applied to all superannuation products.
The other major trend at the moment is the flow of funds into the profit-for-member sector. The Royal Commission highlighted the importance of people choosing funds that have a long and demonstrated commitment to acting only in members’ best interests.
Some other major trends centre on the Protecting Your Super reforms that took effect from July 2019, which will protect super balances from being eroded by unnecessary fees and costs, and the Member Outcomes Package introduced in September 2019, which will strengthen the prudential framework to deliver a more transparent and accountable retirement savings system.

What developments in superannuation public policy is AustralianSuper most interested in? What changes would you most like to see?  

AustralianSuper had our annual member briefings recently where we went to every capital city to hear from members, well over 4000 people attended from across the country. The overwhelming feedback we got from members was that they wanted less tinkering and more stability in the superannuation system. We have seen the progression of legislation through the Parliament to implement the recommendations emerging from the Royal Commission, which AustralianSuper strongly supports. But we are at a point where the policy settings need to settle so that members can plan and make decisions based on a sold platform of rules and regulations.

Recent research from Coredata backs this up with more than one-in-four Australians over 50 seeing ‘government legislative change changing the goal posts’ as the number one risk to their financial security in retirement. While two thirds (64.7 per cent) of Australians over 50 years ranked it within the top three risks to their financial security in retirement.

The one major outstanding change that does need to happen is the legislated move of the Superannuation Guarantee to 12 per cent.

What is your role at AustralianSuper? What does a typical day look like?

As the Group Executive for Membership, I oversee business growth, marketing, financial advice and education. It’s a wide portfolio that takes in all the relationships we have with our more than 300,000 contributing employers, union stakeholders, tender consultants, our relationship with our financial adviser network, our member education program and all the Fund’s marketing activities.

Given the breadth of activity the Group undertakes I’m not so sure there is a typical day! A big part of my role is ensuring that all the moving parts are aligned to the Fund’s business plan and that we continue to deliver for members. Due to the Fund’s national footprint, I regularly travel interstate to meet with various stakeholders to communicate the work the Fund is doing to benefit members, businesses and advisers. Hearing feedback first hand is critical to being responsive and improving our offering to meet customers’ needs now and into the future.  

One of the great things about AustralianSuper is that we have an embedded ‘one fund’ approach to the business. That means there’s a lot of collaboration across the various groups. For example, if the investments team has acquired a great asset we are very well placed to let our adviser network know what we have done and why, and then also incorporate the information into member education and events programs.

What are the current strategic priorities for your portfolio?

One key focus at the moment is around financial advice. We want to be able to help and guide our members to and through retirement and financial advice plays a key role in that aim. The Fund offers advice services to members with around 10,000 member interactions annually with these services. There are 20,000 AustralianSuper members with $4.2 billion in assets being looked after by 1200 financial advisers who are registered with the Fund. We have seen a massive increase in new members coming to the Fund from external advisers especially in the pension phase where we have seen 300 per cent growth to same time last year. Financial advisers who work with AustralianSuper members are guided by a set of principles to put member interests first. The Fund never pay advisers incentives, bonuses or commissions. The needs of members continues to grow and the Fund is committed to continue to support this need through investment in all levels of our advice offering to help members in a way that best suits them.

Another priority is helping to educate our members so that they have a better understand of the super and how they can have control over their financial future. AustralianSuper provides a range of member education services, from face to face seminars and presentations and online interactive webinars through to workplace education. We cover a wide range of topics such as financial literacy, superannuation and insurance basics, estate planning, how to save more super, helping make retirement savings last longer and transitioning to retirement. In 2018-2019, the Fund hosted over 2,080 education activities, benefiting over 55,800 members. The Fund continues to focus on improvements in education particularly as it relates to the use of behavioural economics and improved technology to better engage and educate.

What have been some of your highlights in your time at AustralianSuper?

One of the biggest highlights has been seeing the increase in the number of people actively choosing to become AustralianSuper members. Last year we welcomed 413,000 new members to the Fund. This growth helps to build scale that ultimately benefits all members.
Another highlight for me was when, not long after starting with the Fund, I moved to Perth in 2011 for a period to lead the Westscheme merger. Now, one in four working West Australians are members of the Fund. It was a terrific experience and I encourage colleagues to always put their hands up for opportunities out of the box like this.

From a Fund wide perspective, our strong investment performance for members has been the major highlight. I’m in awe of the efforts of the investments team to have moved to 40 per cent of assets being managed internally in just over five years, and the expansion of our global offices means we now have opportunities for colleagues in New York, London and Beijing. This internalisation of investments has seen costs for the Fund’s default Balanced option fall by 21 per cent over the decade.

It has also been pleasing to see the Fund take leadership positions over the years I have been here on a number of policy and reform issues that have been very important to our members. A recent example was the Fund leading the way in getting rid of default insurance for under 25 year olds, which has now become a legislated requirement.

What are your hopes for AustralianSuper over the next five years?

AustralianSuper members consistently tell us they want: strong long-term performance, low costs, good products and services, trustworthy governance and a reputable brand. My hope for AustralianSuper is that we continue to deliver on all of those elements and help members achieve their best possible retirement outcome.

Why is AustralianSuper a CEDA member?

CEDA provides a fantastic forum for discussion and debate of the major public policy issues confronting Australia. AustralianSuper strongly values the opportunity to hear and learn from both CEDA and the organisations that make up its broad membership.