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Yesterday was day one of the 2013 ASFA National Conference in Perth, and BlueChip was there. Here we summarise some of the latest from insiders on the current state of the industry, where it’s headed and how we might get there faster – including through more meaningful communication to create true member engagement.
With the political and regulatory interest bestowed on the superannuation industry in the last year or two, it’s clear that we’re looking at an industry on a tipping point.
And, according to Association of Superannuation Funds of Australia (ASFA) head, Pauline Vamos, the resulting change is necessary if we are to take the system from its original form, as developed some 25 years ago, and update it to respond to factors we now know are crucial to its ability to meet its remit of supporting Australians throughout their post working years. These factors include the reality of increased life expectancy, technological advancements and even consumer habits and expectations relating to issues such as lifestyle.
So what will this transformation entail? Under the overarching theme of ‘Beyond the horizon’, a range of opinions and insights on what the next phase for the superannuation system may / could / should look like were presented yesterday, day one of the ASFA National Conference.
Below is a handful of key insights from a few of the day’s key speakers, with more to come in following blogs from the conference venue in sunny Perth.
Geoffrey Robertson QC (and all-around funny and intellectually inspiring ex-pat) went beyond ethical or positive investing and pointed to social impact investing as the way of the future, saying that this type of investment provides innovative answers to challenges being thrown up by mega-trends. He cited the NSW Government’s current trial of three social bonds around prison initiatives as an example of this sort of investment in practice.
Mike Wilkins, MD and CEO of IAG, spoke of the challenges faced by IAG when it transitioned from a mutual to a commercial business – an experience that resonated with a number of superannuation folk I am sure. He said that a big lesson was that perfectionism was a killer of innovation and progress. In order to meet the expectations of customers in an ever advancing society, they had to change to a business that was driven by three stages: ready, aim, fire! instead of an overly cautious one that would too often become stuck at ‘ready… ready … ready …’
Peter R. Orszag, Vice Chairman of Global Banking at Citigroup (USA), said global economic growth is more dependent currently on sound policy decisions than at any other point in history. He also raised the potentially controversial question – in the context of a discussion about the growing importance of transparency – around the link between true leadership and complete transparency: for true leadership to be possible, isn’t some opaqueness necessary?
Robert Merton, Resident Scientist from Dimensional Fund Advisors (USA), was the man with all the answers, as he took us through how he would design a superannuation system, starting from scratch, to ensure we would avoid issues we currently face. A key feature of his system? It must be designed to deliver to those who are completely disengaged throughout the whole accumulation period. But if (and hopefully when) they do become engaged, it’s important to offer them the most meaningful information and choices. It’s not about sharing a great volume of ‘important’ information. If members can’t convert that into meaningful data or content, it is wasted.
(Perhaps this could relate to the question above around transparency – perhaps it isn’t about being opaque but rather about being meaningful?)
Stay tuned for more from the ASFA conference, including insights from our very own BlueChip MD, Carden Calder, who will be presenting today on during a panel discussion on the eternal question of member engagement or, more specifically: “How to grow and retain your customer base: the importance of using the right communication channels”.
