A joint venture between two superannuation funds with a combined $26 billion and 150,000 members has today taken off, with the chief executive hinting more funds could become involved.
Equipsuper and Catholic Super's joint venture is officially under way today and governed by a new, skills-based board of 12 directors.
The chief executive of the joint venture, Scott Cameron, told Financial Standard: "We see this as a scale play and within this model we have the flexibility to bring on additional funds."
Those funds could keep their own branding, as Catholic Super has, or could merge.
|Sponsored by MetLife Insurance|
Do your clients understand how commissions work?
Cameron said that while the joint venture has resulted in some board retirements to get the joint trustee board to a workable size, within the funds themselves it has been business as usual.
"Today's the first day and it is business as usual and everyone is working hard," he said.
Equipsuper chair Andrew Fairley will chair the new joint trustee board, called Togethr.
"This is a new dawn and a new era for super mergers as we scale up to benefit members under an extended public offer (EPO) licence," Fairley said.
"While other funds are talking about merging, Equip and Catholic Super are getting on with it.
"The EPO licence was issued three years ago. The Catholic Super board has had the courage to embrace the model, breaking new ground while being agile, innovative and aware of the reform backdrop that is shaping the future of our super industry."
Cameron echoed Fairley's sentiments, saying: "We're doing the right thing at the right time."
He said the response to the joint venture has been broadly positive so far and explained that the EPO licence allows the funds flexibility to continue to grow.
An EPO model means participating funds can achieve economies of scale in administration and investments, without loss of brand identity or control of relationships with members, employers and other stakeholders.
In an EPO, funds share a single trusted led by a merged trustee board.
Earlier this month, Financial Standard revealed the Dow Australia Superannuation Fund had merged with Equipsuper.