The Australian Securities and Investments Commission (ASIC) recently reviewed superannuation websites to evaluate whether they have properly adapted to the Stronger Super reforms implemented in 2013. Under s29QB of the Superannuation (Industry) Supervision Act (SIS Act) and SIS regulations 2.37 and 2.38 of the Stronger Super reforms, superannuation websites must publish transparency information including executive remuneration disclosure and super funds’ governance information. (To read more on ASIC’s requirements, see HERE). These reforms were passed in order to provide transparency for consumers and to improve regulation of superfunds.
Though ASIC has found that the majority of superannuation trustees have successfully implemented the transparency reforms, there are still those who have not. In some cases, no websites existed, and in others, information was lacking or difficult for users to locate. In others there was a failure to fully comply. For example, some executive remuneration was reported in bands, and not for specific officers. Others do not include the remuneration of appropriate executives. ASIC examples of position titles of senior managers whose remuneration was disclosed include: Chief Executive Officer, Deputy CEO, Chief Investment Officer, General Counsel & Company Secretary, Chief Risk Officer, Chief Financial Officer, Chief Actuary, Fund secretary, Executive Manager (EM) Administration & Insurance, EM Member Advice, General Manager (GM) Strategic Relations, GM Marketing & Communications, GM Information Systems and Head of Infrastructure.
Based on findings, ASIC has provided recommendations to improve online disclosure of transparency information:
- Make Transparency Information intuitively easier to find on the homepage by having a link on the homepage called, for example, “Transparency Information under SIS Act s29QB” or “SIS Act s29QB website information – ASIC found that it took 3 to 4 clicks on average, starting from the home page, to locate Transparency information. This needs to be streamlined to make the website more user friendly.
- Websites should be regularly reviewed and frequently updated to comply with s29QB timeframes – Rather than maintaining a current website with new, relevant information, ASIC found that some trustees only updated websites once or twice a year.
- Disclose the periods that executive officers (directors and senior managers) have served as board members, not forgetting senior managers who may previously have served as a director – Though most websites disclosed remuneration and periods of service for directors, some failed to disclose information of senior managers. ASIC provides guidance on which senior managers are to be considered executive officers.
- Only disclose a director’s remuneration as nil if they provide their services in a purely voluntary capacity – Besides directors who work as directors in a voluntary capacity after hours or on annual leave, remuneration should be disclosed as a positive number.
- Include voting summaries on international, not just Australian, listed shares – ASIC found that some websites only included voting on foreign or domestic listed shares; both should be listed for consistency and clarity.
- Where the trustee’s policy is not to vote on listed shares, disclose that there is
no voting summary – this prevents users from searching for information that does not exist.
- Where voting summaries comprise a table listing how votes were cast on specific resolutions, consider including an overview, like an executive summary. This might include showing overall voting by resolution type and simple graphics (e.g. pie charts) – For more examples, please see HERE).
ASIC is following up with any trustees who have failed to disclose some or all of required information.
Further details can be found HERE.
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