AustralianSuper seems to be striving hard to give its members what they want.
Superannuation funds are under pressure to give their members as much information about their funds as shareholders of listed companies receive.
Although some of the largest funds have started to be more open with members, there is a long way to go.
AustralianSuper, which has about 2 million members and manages about $50 billion, is leading the way on transparency. The not-for-profit fund publishes how much the chief executive, Ian Silk, earns as well as the next four highest-paid executives.
AustralianSuper's annual report gives considerable detail about the fund's operations, and it has been holding annual member briefings since 2006, alternating each year between Sydney and Melbourne.
In Sydney last Tuesday, about 150 members were on hand and more than 1000 watched the webcast as the fund's senior executives gave an overview of the year and answered questions. Silk explained that as the fund gets bigger, it lowers costs for members.
The fund will merge with the Australian Government Employees Superannuation Trust by the end of 2012, and AustralianSuper will also run IBM's corporate fund by the end of November. Silk said not all merger proposals were accepted, and a merger would only occur if it was in the interest of members.
He also said more of the investment management was being brought in-house, which would further lower costs. He said the investment management fee of about 0.6 per cent should fall to about 0.4 per cent as more of the funds management comes in-house over the next four or five years.
The fund is a leader in offering its members greater flexibility in how they want to invest. Its Member Direct investment option allows members to invest in shares of Australia's largest 300 listed companies, exchange-traded funds and term deposits. It is part of the fund's response to the popularity of self-managed superannuation funds.
On the outlook for investment markets, Tim Poole, the chairman of the investment committee, said he expected tough times for equities markets and investment returns generally, given sluggish global economic growth and the debt problems in Europe.
As a consequence, the fund has lowered the exposure to shares of its balanced investment option, where most members have their money.
Given the poor performances of super funds generally, it was perhaps surprising there were no complaints from members. While the return of the balanced option for the year to June 30, 2012, was only about 1 per cent, that was better than most other funds.
Over the 10 years to June 30, 2012, the balanced option has produced an average annual return of 6.4 per cent, which is also better than average.
Two members complained about the six-week "black-out" period at the start of each financial year. While members can switch investment options during this black-out period, the switch does not appear on the members' online accounts until the end of the period. Silk said the period would soon be three days.