Submission on Superannuation Legislation Amendment (Trustee Obligations and Prudential Standards) Bill 2012

• Date:13 Jan 2012
• Type:Policy Submission

This submission relates to the exposure draft of the Superannuation Legislation Amendment (Trustee Obligations and Prudential Standards) Bill 2012. This Bill is the second tranche of legislation implementing the Government’s MySuper and governance reforms as part of Stronger Super. In particular, the Bill expands the duties for trustees of registrable superannuation entities (RSEs), applies new duties to trustees of regulated superannuation funds that include MySuper products, and applies personal duties to directors of corporate trustees.

We raise in this submission our concerns regarding the Bill. We comment that the Bill requires further refinement to ensure that the obligations on trustees of RSEs and directors of corporate trustees are not unduly onerous, and also to provide certainty to trustees and directors. We also note that the new personal duties imposed on individual directors of corporate trustees of RSEs undermine well established and significant principles of trust and corporate law.

We submit that the introduction of new and appropriate obligations on corporate trustees, combined with obligations on directors to exercise a reasonable degree of care and diligence for the purpose of ensuring that corporate trustees carry out their obligations, may be a preferable means of achieving improved governance of superannuation funds.

We further submit that consideration could be given to other measures to ensure greater accountability of directors of corporate trustees to the members of superannuation funds.

Download our submission on Superannuation Legislation Amendment (Trustee Obligations and Prudential Standards) Bill 2012 (PDF 4MB)