Most super funds won’t say where your money is invested

Posted: 27 September 2016 2:01 pm News

Superannuation question investment

Nearly $1 trillion in undisclosed managed funds.

The majority of Australians believe they have the right to know where their superannuation is being invested, yet nearly $1 trillion of assets in Australia's fifty largest super funds remains undisclosed.

An analysis by environmental finance campaigners Market Forcers found Australia's 50 biggest superannuation funds did not disclose investment details for 83% of assets under management.

Most Aussies (86%) believe super funds should be more transparent, divulging where their contributions are invested.

However, nineteen of the top 50 funds don't disclose any investment information at all. Three funds - HOSTPlus, Cbus and VicSuper - disclose more than 50% of their holdings and just one, Energy Super, is completely transparent, offering full disclosure on its entire portfolio.

Industry funds disclosed, on average, 25% of their portfolios, compared with just 4% of retail funds. In terms of satisfaction, industry super funds have been outperforming retail funds for more than 15 years.

This opacity means super funds hold close to $1 trillion in undisclosed managed funds.

Top 10 super funds by level of disclosure

Superannuation Fund ($ millions) Disclosed % Undisclosed ($ millions)
Energy Super 6,100 100%
Hostplus 18,500 65% 6,475
Cbus Super 33,400 62% 12,692
VicSuper 16,000 59% 6,560
Catholic Super 7,300 41% 4,307
UniSuper 54,700 40% 32,820
GESB 22,000 37% 13,860
First State Super 55,200 36% 35,328
Australian Super 100,000 32% 68,000
Local Government Super 9,300 28% 6,696

In 2010, the Treasury's Super System Review recommended large super funds disclose their complete portfolio holdings on a six-monthly basis to improve transparency.

"Though the industry claims to support the improvement of disclosure standards, the reality shows this is manifestly not the case," Market Forces analyst Daniel Gocher said.

More than half the respondents (64%) also felt their super fund should be proactively reducing its exposure to fossil fuel investments. One third of those surveyed said they'd be prepared to switch funds if they learned their current fund invested in coal or coal seam gas extraction.

Despite this, only five of Australia's 50 largest funds currently report on carbon intensity - the volume of emissions emitted per million dollars invested.

Australian superannuation assets increased to $2.1 trillion at the end of June 2016, however, net contribution flows decreased 13.9% year-on-year to $34 billion.

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