The Success of representative governance on superannuation boards: A Report of the Centre for Workforce Futures for the McKell Institute

This report examines the governance structures and performance of industry superannuation funds in comparison to other superannuation funds in the Australian and international market. In 2010 the Super System Review (Cooper Inquiry) recommended that industry superannuation funds alter the current representative board structure to appoint a proportion of independent directors to all industry superannuation funds. Through a comprehensive review of published research together with an analysis of statistical data on both for-profit and not-for-profit superannuation funds, this report examines the relationship between their governance structures and performance in order to evaluate the efficacy of the Cooper Inquiry recommendations. The report concludes that evidence does not support the view that mandating independent directors on not-for-profit superanuation funds would improve fund performance. Instead, research and empirical data suggests strongly that the representative trustee governance structure of industry and other not-for-profit funds is actually the model that most closely satisfies the objectives of meeting the best interests of members and maximising retirement incomes for Australians.