We are looking forward to you joining us at the Annual Members’ Meeting on the 24th of November. To help you prepare for the meeting, we have compiled a list of questions and answers on key topics you might want to know more about.
Regulatory Changes – Your Future, Your Super
How does Your Future, Your Super affect me?
The main direct impact on members is that members are now ‘stapled’ to their existing super fund.
This means when you change job, if you don’t complete a Choice of Fund form and select a new super fund, the ATO will notify your new employer of your existing super fund and your super contributions will continue into your existing fund.
If you have never had a job, and do not have a super fund, the ATO will advise your employer, who can then place you into their default super fund.
The intent of this is to reduce the number of people with multiple accounts which can see savings eroded by paying fees to multiple funds.
You can compare funds by using the ATO’s comparison tool on their website
What if I want to keep my super account for insurance purposes only?
If you want to keep your super account for insurance purposes only, the Aware Super and VicSuper mobile apps have the details you need – just click on the “Profile” for both fund and account number details.
When you complete the Choice of Fund form, this will confirm your contributions go to the fund you want. We suggest that you also check that your insurance requirements are appropriate when reviewing, considering or changing your superannuation funds or accounts.
What about the Performance test measures in Your Future, Your Super?
The Performance test has just been completed for the first time – Aware Super and VicSuper passed the performance test. Members of some funds have received letters from their funds telling them the product they are using for their super savings has underperformed – and it suggests they should look for another fund. Members can go to the ATO to use a comparison tool which shows performance of MySuper funds (it does not show choice products).
Best Financial Interests Duty
What is meant by the Best Financial Interests Duty?The Best Financial lnterests Duty is a requirement of super funds to make sure expenditure decisions are made in members’ best financial interests. Its goal is to improve governance and decision-making on behalf of members. No action is needed by members.
How do you invest my super?
We have an investment team of over 80 investment professionals who oversee our investment portfolios and also manage a number of investments in-house.
Our Investment Strategy Team has a whole-of-fund view and considers how we invest at a holistic level. This team is responsible for strategic asset allocation decisions, and the implementation of active asset allocation decisions when a market opportunity arises or in periods of market dislocation.
Our other investment teams are structured by asset class which allow them to focus on investments within their sector, applying their relevant specialist capabilities and background. As an example, we have a Property Team that focuses on investments in both listed and unlisted property assets. The specialist teams engage extensively with a support team of investment tax, legal, governance, responsible investment and operational due diligence professionals to ensure the end investment is researched to a high standard, incorporates environmental, social and governance (ESG) considerations, and is structured appropriately to deliver optimal investment outcomes for our members.
Where is my money invested?
The fund makes investments across a large number of countries, both developed and developing, largely through external investment managers. Investing abroad allows us to increase diversification and access industries not well developed in Australia. For example, while the Australian investment share market has a strong focus on mining, finance and agriculture, other industries such as biotechnology and pharmaceuticals are less represented.
We publish equities holdings information on our Aware Super website and VicSuper website. We also provide examples of investments in our property, infrastructure and real assets, and private equity asset classes on our Aware Super website and VicSuper website.
We are working on a project to provide full portfolio holdings disclosure to our members to comply with legislative requirements that are due to be introduced on 31 December 2021.
How did my super perform for the year to 30 June 2021?
FY21 will be remembered as a truly extraordinary year for the global economy and markets.
We delivered positive 1-year returns for members in our diversified options. This included our default MySuper Life Cycle options, with the Growth option returning 18% for both Aware Super and VicSuper for the year to 30 June 2021.
You can also refer to your annual statement for more information on how your super performed for the year.
Do you provide an ethical option that I can invest in?
For members who want greater certainty about the environmental and social impact of their investments we offer investment options that exclude investments considered to have a highly adverse environmental or social impact, as identified by our screening criteria.
At Aware Super, we offer the Diversified Socially Responsible Investment (SRI) option and the Australian Equities SRI options. You can read more about these here.
At VicSuper, we offer the Socially Conscious investment option. You can read more about these here.
Is Aware Super divesting of all fossil fuel investment products and investing in renewable energy products?
Aware Super, and VicSuper as part of Aware Super, divested from thermal coal miners from 1 October 2020. We have seen over the past few years a significant move to renewable energy and new technologies in response to an urgent need to lower greenhouse gas emissions and we’ll continue to look for new opportunities in this area.
Our Climate Change Portfolio Transition Plan launched in July 2020 is an updated framework of recommendations and targets that will focus our efforts on:
- developing a decarbonisation pathway for our investment portfolio,
- transitioning our portfolio to lower climate change risk in our investments and, where required, helping those investments adapt to a changing climate. For example, working with our agricultural investments to help them adapt their practices to a warming and changing climate,
- proactively investing to capture opportunities in energy-efficient investments, that will emerge as we move towards a decarbonised economy, and
- lowering risk through actively managing and engaging with portfolio investments on their climate change transition pathway.
You can read about how we are tracking towards our targets in our one-year-on update here.
Our research shows that climate change is one of the most significant risks to our portfolio and therefore to our members’ retirement savings. To ensure that we continue to deliver for our members in the long term it is essential we mitigate the risks to our portfolio – including climate change risks.
We launched our Climate Change Portfolio Transition Plan to respond to these risks and be a force for good in our community. For more information on our approach to climate change see our website here.
For more information about our investments in renewables, please see our ‘Investing in renewables’ blog.
Why is it so hard to get someone to answer the phone / respond to my enquiry? What are you doing about this?We have recently increased our staff resource. Coaching and training is in place to ensure staff deliver the level and timely service expected. The cross-skilling of teams will enable us to provide a high level of service during peak periods such as when statements are issued.
The processes to access my money / make changes to my account is so difficult. What are you doing to make it easier for members?A dedicated program of work is being undertaken, and we are investing significantly in new technology to ensure we provide experiences for our members that are simple, safe and personalised.
What are the key elements of Aware Super’s strategy?
Our strategy clearly defines the shared Purpose and Vision that defines our “why”, the seven strategic themes (the things we want to be known for) that define our “what”, as well as “how” we’ll achieve our goals.
For more information about our corporate strategy see our annual report here.
How are we ensuring successful delivery of our strategy?
We are focused on working in four different areas to deliver our strategy:
- Performing: Ensuring excellence in safe and sustainable execution and continuous improvement across all we do
- Growing: Driving scale to underpin low fees, strong performance, and great member services
- Transforming: Step-change in our capabilities and the experience for our members, employers, advisors, and teams and
- Enabling: Being the best place to work, member-first, having a strong risk culture and capability, and establishing digital, data and technology enablers.
For more information about our corporate strategy see our annual report here.
How do we manage risk at Aware Super?We have both risk and compliance frameworks allowing us to manage both our risks, which includes compliance obligations. Accountability for the management of risks is clearly agreed across all executives and is assessed on a regular basis. This process is the same for both internal and external.
How does Aware Super manage risks to achieve the Strategy?Aware Super’s Board has a Risk Appetite Statement which defines what risks we are willing to take in order to achieve our strategy. These risks are revisited on an annual basis and tracked on a quarterly basis during the year. Where we are close to going outside this appetite, specific actions are undertaken to bring the organisation back within appetite.
Is the integration of WA Super and VicSuper now complete and what does this mean for members?The integration of WA Super is complete and members have seen overall improvements in their insurance cover, increased access to financial advice and the benefits of scale with increased exposure to a broader range of assets. The VicSuper operational integration has been completed except for the migration of the member administration to the new Bravura Alta technology platform. This will be completed in the first half of 2022 and will provide members with significantly better control of their superannuation accounts as well as access to a new award-winning mobile app and a range of more flexible insurance covers.
Are there any other mergers imminent?The superannuation industry is continuing to consolidate and Aware Super continues to engage in merger discussions with the objective of building scale in order to pass on benefits such as lower fees, broader investment opportunities and enhanced products and services to all of its members. Our merger discussions are only progressed where it is in the best interests of our members.
When will the Victorian Independent Schools Superannuation Fund (VISSF) merger be completed?The VISSF merger is on schedule to take place in early December of this year.
Do well, do good – what does that mean?It’s our brand promise – something we’ve committed to for our members and for all Australians. We are committed to helping our members do well through strong investment performance, through our products and through our education, guidance and advice. We are also committed to doing good for all by how we invest to support our economy, our communities and the planet, the innovation we bring to market and our commitment to being a responsible business.
How is this in members’ best interest?
Any investment in brand is designed to help the fund grow and support the long-term sustainability of the fund in a highly competitive market.
Being big helps us deliver better value to our members – by being able to access unique and valuable investment opportunities that support stronger returns and by being able to put downward pressure on the fees we’re charged by suppliers.
Members have already benefited from stronger returns with the fund returning an average of over 11% over the past five years. We are a top 10 performer. We are focused on ensuring that we use our size to reduce costs and increase performance so our members retire with more.
Why do you spend money on advertising?
As we rebranded in September 2020, we are advertising to build awareness of and familiarity with our new brand. This is important because having a strong brand enables us to compete and supports us in achieving our strategic growth objectives.
Our market has been changing for a while with more people exercising choice – the Your Future Your Super legislation will further accelerate the shift towards choice. This shift is a welcome one but for people to choose Aware Super they must be aware of who we are and like what they see.
Competition is also increasing – not only are there other large funds whose spend on their own brand continues to be greater than ours in real and cost per member terms, but we’re seeing smaller ‘niche’ funds become increasingly strong in how they promote themselves.
Don't sit there wondering - our team members are here to help!