Peak bodies join forces over due diligence

The Australian Institute of Superannuation Trustees and the Financial Services Council have joined forces, releasing guidance tools designed to help fund managers prepare operational due diligence reports for the superannuation industry.

The FSC has developed a questionnaire which will allow fund managers to respond to super fund due diligence requests more easily. The questionnaire covers the provision of information to third parties, including both superannuation fund clients conducting their own due diligence and external operational due diligence (ODD) assessors.

Additionally, the two industry bodies have released a frequently asked questions document which will help fund managers understand what information super funds expect to be provided. The document will also answer questions about how this information will be included in super funds' due diligence reports.

FSC chief executive Sally Loane said the current system for conducting operational due diligence was labour intensive for both super funds and fund managers.

"I am pleased we have been able to collaborate with the AIST to simplify the process, prevent repetition of work and generate cost and time efficiencies for both of our members, the benefit of which will flow through to consumers," Loane said.

AIST chief executive Eva Scheerlinck added that by adopting a collective approach to operational due diligence, the super industry and its members would save millions.

APRA acknowledged the initiatives of the two peak bodies in its most recent Insight publication.

"Ongoing efforts by industry bodies and regulators to engage with stakeholders on ODD requirements are now being reflected in greater recognition of the benefits of undertaking ODD, beyond it being seen as largely a compliance exercise. There is now a greater level of constructive dialogue around 'how' to best roll-out ODD, rather than 'why' it is needed," APRA said.

Read more: ODDAPRAAustralian Institute of Superannuation TrusteesFinancial Services CouncilAISTFSCSally LoaneEva ScheerlinckInsight
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