Global Humanity Looks to Unity of Minds in Crisis: Massacres of Muslim Worshipers in Christchurch, New Zealand

"And if we do act, in however small a way, we don’t have to wait for some grand utopian future. The future is an infinite succession of presents, and to live now as we think human beings should live...

Dr Mahboob A Khawaja, PhD. - avatar Dr Mahboob A Khawaja, PhD.

New TAFE program for Aboriginal health-care students sees a near perfect completion rate

If we are to close the gap in health outcomes for Aboriginal people, we need to develop and staff culturally competent health-care services.from shutterstock.comA customised scholarship program develo...

Kylie Gwynne, Associate Professor and Research Director, Poche Centre for Indigenous Health Faculty of Medicine and Health, University of Sydney - avatar Kylie Gwynne, Associate Professor and Research Director, Poche Centre for Indigenous Health Faculty of Medicine and Health, University of Sydney

Two million Aussies delay or don't go to the dentist – here's how we can fix that

When did you last visit the dentist?By Concept Photo/ShutterstockDental care in Australia is a policy anomaly; for some reason, the mouth is treated very differently to other parts of the body. About ...

Stephen Duckett, Director, Health Program, Grattan Institute - avatar Stephen Duckett, Director, Health Program, Grattan Institute

We need a new definition of pornography - with consent at the centre

In a search of social science literature on pornography, none of the definitions reviewed mentioned consent.ShutterstockWe all think we know what pornography is, whether we oppose it, use it, or toler...

Sarah Ashton, PhD Candidate, Monash University - avatar Sarah Ashton, PhD Candidate, Monash University

Women can build positive body image by controlling what they view on social media

It is possible to limit your bombardment with images of bodies that feel way out of reach – so choose wisely who you follow. hannah grace / unsplash, CC BYSocial media use is often described as ...

Rachel Cohen, Clinical Psychologist and PhD Candidate, University of Technology Sydney - avatar Rachel Cohen, Clinical Psychologist and PhD Candidate, University of Technology Sydney

Ultra low wage growth isn't accidental. It is the intended outcome of government policies

This is the first in a three-part mini-symposium on Wages, Unemployment and Underemployment presented by The Conversation and the Academy of the Social Sciences in Australia.The long debate over the c...

John Quiggin, Professor, School of Economics, The University of Queensland - avatar John Quiggin, Professor, School of Economics, The University of Queensland

Curious Kids: why bats sleep upside down, and other stories of animal adaptation

Zzzzzzz...Flickr/Ryan Poplin, CC BY-SACurious Kids is a series for children. If you have a question you’d like an expert to answer, send it to curiouskids@theconversation.edu.au You might also l...

Amy Edwards, Post Doctoral Researcher, La Trobe University - avatar Amy Edwards, Post Doctoral Researcher, La Trobe University

'Give us a sniff, love': giving marsupials scents from suitors helps breeding programs

A baby eastern barred bandicoot pokes its head out of its mother’s pouch. M. Parrott, Zoos Victoria, Author providedSmell is a vital part of sexual attraction for all kinds of animals (including...

Marissa Parrott, Reproductive Biologist, Wildlife Conservation & Science, Zoos Victoria, and Honorary Research Associate, BioSciences, University of Melbourne - avatar Marissa Parrott, Reproductive Biologist, Wildlife Conservation & Science, Zoos Victoria, and Honorary Research Associate, BioSciences, University of Melbourne

Youth homelessness efforts get a lowly 2 stars from national report card

Despite a ten-point roadmap and bold commitments, Australia has not stayed on track to reduce youth homeless over the past decade.Roman Bodnarchuk/ShutterstockA National Report Card on Youth Homelessn...

David MacKenzie, Associate Professor, Department of Social Science, Swinburne University of Technology - avatar David MacKenzie, Associate Professor, Department of Social Science, Swinburne University of Technology

View from The Hill: A truly inclusive society requires political restraint

“Standing against hate” requires robust leadership from the politicians.AAP, CC BY-NCTerrible tragedies test leaders to the full. Anyone watching from afar must be impressed with the way i...

Michelle Grattan, Professorial Fellow, University of Canberra - avatar Michelle Grattan, Professorial Fellow, University of Canberra

NSW election neck and neck as voters face a 1950s-style 'I'll see you and raise you' campaign

On Saturday, March 23, the people of New South Wales will head to the ballot boxes for a state election. It is looking increasingly close, with polls showing government and opposition neck and neck on...

David Clune, Honorary Associate, Government and International Relations, University of Sydney - avatar David Clune, Honorary Associate, Government and International Relations, University of Sydney

Ultra low wage growth isn't accidental. It is the intended outcome of government policies

This is the first in a three-part mini-symposium on Wages, Unemployment and Underemployment presented by The Conversation and the Academy of the Social Sciences in Australia.The long debate over the c...

The Conversation - avatar The Conversation

Christchurch attacks are a stark warning of toxic political environment that allows hate to flourish

When lives are tragically cut short, it is generally easier to explain the “how” than the “why”. This dark reality is all the more felt when tragedy comes at the hands of murd...

Greg Barton, Chair in Global Islamic Politics, Alfred Deakin Institute for Citizenship and Globalisation, Deakin University - avatar Greg Barton, Chair in Global Islamic Politics, Alfred Deakin Institute for Citizenship and Globalisation, Deakin University

Can a senator be expelled from the federal parliament for offensive statements?

In the wake of comments about the Christchurch massacre, members of the public have raised the question of whether a senator can be expelled from the Senate for making offensive statements. It is now...

Anne Twomey, Professor of Constitutional Law, University of Sydney - avatar Anne Twomey, Professor of Constitutional Law, University of Sydney

The psychology of fear and hate, and what each of us can do to stop it

New Zealand Prime Minister Jacinda Ardern has travelled to Christchurch after yesterday's terror attacks.NZ Prime Minister's office, CC BY-SAAs an immigrant to New Zealand, I am saddened and outraged ...

Stephen Croucher, Professor and Head of School of Communication, Journalism, and Marketing, Massey University - avatar Stephen Croucher, Professor and Head of School of Communication, Journalism, and Marketing, Massey University

Why overhauling NZ's gun and terrorism laws alone can't stop terrorist attacks

Grieving members of the public following a shooting at the Masjid Al Noor in Christchurch.EPA/Martin Hunter, CC BY-SAMy research focuses on terrorism in or affecting New Zealand. Until yesterday, my p...

John Battersby, Police Teaching Fellow, Massey University - avatar John Battersby, Police Teaching Fellow, Massey University

Random Thoughts V

If Planned Parenthood was selling puppy body parts they would be shut down yesterday. The thirties and forties are a blur with work and family.  The fifties start to slow down and in the sixties yo...

Dr. Robert Owens - avatar Dr. Robert Owens

Christchurch mosque shootings must end New Zealand's innocence about right-wing terrorism

Members of the Armed Offenders Squad push back members of the public following a shooting at the Masjid Al Noor mosque in Christchurch.AAP/Martin Hunter, CC BY-SATonight, New Zealand police continue t...

Paul Spoonley, Pro Vice-Chancellor, College of Humanities and Social Sciences, Massey University - avatar Paul Spoonley, Pro Vice-Chancellor, College of Humanities and Social Sciences, Massey University

Why news outlets should think twice about republishing the New Zealand mosque shooter's livestream

Like so many times before with acts of mass violence in different parts of the world, news of shootings at two Christchurch mosques on Friday instantly ricocheted around the world via social media. Wh...

Colleen Murrell, Associate Professor, Journalism, Swinburne University of Technology - avatar Colleen Murrell, Associate Professor, Journalism, Swinburne University of Technology

“Did you think to yourself that taking money to which there was no entitlement raised a question of the criminal law?” Commissioner Kenneth Hayne asked Nicole Smith, who resigned as chair of NAB’s superannuation trustee, NULIS, a little more than a month before she fronted the banking royal commission.

“I didn’t,” Smith replied.

Smith’s evidence related to NAB skimming A$87 million from superannuation accounts by charging 220,000 members “service fees” for which no service was provided. As head of the board of the superannuation trustee, it was Smith’s job to act solely in the best interests of the members. Instead she acted in the best interests of NAB.

Her admissions and the evidence from the royal commission that more than $A1 billion has been taken from superannuation accounts for no service show we need better supervision of the trustees who oversee more than A$2.7 trillion in superannuation assets.

As senior counsel assisting the commission Michael Hodge put it:

Trustees are surrounded by temptation, to preference the interests of their sponsoring organisations, to act in the interests of other parts of their corporate group, to choose profit over the interests of members, and to establish structures that consign to others the responsibility for the fund and thereby relieve the trustee of visibility of anything that might be troubling.

The entrenched practice of retail super funds using superannuation trust funds as profit-making enterprises undermines the integrity of the whole superannuation sector. Focused regulatory action and oversight are imperative to protect it.

Super duties

Super trustees are subject to a range of stringent duties.

There are “equitable” duties, which arise from trustees being fiduciaries – responsible for acting in the best interests of the owners of the assets they manage. As fiduciaries, super trustees must avoid conflicts of interest and account for any profit they make.

As trustees specifically, they must act in the best interests of the beneficiaries and exercise powers conferred to them as trustees (trust powers) with real and genuine consideration.

All trustees are legally obliged to act in the best interests of the people whose money they are entrusted with. Superannuation trustees have an even greater obligation, because of the social importance of superannuation. The High Court has ruled that public expectations mean superannuation trustees have “more intense” obligations than other private trusts.

This is underlined by the “statutory” duties of the Superannuation Industry (Supervision) Act 1993. It states directors of corporate superannuation trusts must perform their duties in the best interests of their beneficiaries, superannuation fund members.

The act also establishes supervision and oversight of super trustees by the Australian Prudential Regulation Authority (APRA), the Australian Securities and Investments Commission (ASIC) and the Commissioner of Taxation.

Irregular regulation

Yet clearly this oversight has been failing. The evidence from the royal commission is that many super trustees having been ignoring their duties. They have gone along with rubber-stamping unjustifiable fees purely because their parent institutions wanted the money.

In 2017 the prudential regulator was given the power to directly disqualify directors of superannuation trustee corporations. It already had the power to do so by applying to the Federal Court. Over the past decade, however, it has sought just one disqualification.

The regulator’s deputy chair, Helen Rowell, has argued this is due to APRA trying to protect the public interest, avoiding the risk of a run on a fund. But its inaction has arguably emboldened super trustees to ignore their duties because of the low risk of being penalised.

Read more: Has APRA just outsourced its job?

Previous reform proposals

The royal commission may result in criminal charges against banks and financial institutions. One outcome that must come is stronger oversight of super trustees.

Federal parliament already has before it amendments to the Superannuation Industry (Supervision) Act that include requiring individual super trustees to make annual written assessments about whether fees serve the interests of members. However, the bill has reportedly been shelved.

It is therefore critical the royal commission recommend strong action, including reforms proposed by previous inquiries into the financial services sector.

Read more: The problem with Australia's banks is one of too much law and too little enforcement

These include the Financial System Inquiry, which recommended in 2015 that super funds must have a majority of independent directors on their trustee boards. It also proposed new civil and criminal penalties for directors failing to act in the best interests of fund members.

Additional reforms might include:

  • establishing a specific conduct regulator for corporate superannuation trustees

  • making it mandatory for ASIC to prosecute superannuation trustees and related entities (such as banks) for duty breaches, with much higher penalties

  • stronger oversight over responsibilities that corporate trustees outsource to third parties

  • mandatory reporting of corporate fee structures, with regular review to determine if these are justified.

The trust remains the most appropriate legal mechanism to manage savings accumulated over a long time. Much stronger behavioural controls and civil penalties are necessary to ensure super trustees act honestly and in good faith for the benefit of the beneficiaries. That they are, in short, trustworthy.

Authors: The Conversation

Read more http://theconversation.com/with-a-billion-reasons-not-to-trust-super-trustees-we-need-regulators-to-act-in-the-public-interest-102441