Ross Greenwood coined the term "peak super" in opening Day Two of the ASFA conference in Melbourne today. The questions he threw as challenges to the panel and the audience included:
"What happens when the money going out (how everyone in the room currently gets paid) is greater than the money coming in?" and "Do we really have a world class retirement savings and income system?"
The short answers from a panel of industry leaders were "no, we haven't reached peak super" and "we can always improve, but yes, we think it is a world class system both for retirement savings and incomes".
Panel members Steve Bracks (United Super / CBUS), Sue Dahn (ESSSuper and AGEST), Michael Dwyer (FSS) and Nicolette Rubinsztein (CFS) also addressed the previous day's comments by Dr David Morgan in relation to superannuation industry reform, the Henry Report and the balance between retail bank deposits and savings inside super.
Panel comments:
On the banks versus super
"Ken Henry is more focused on bank funding than super adequacy."
"Morgan said 'I'm from the bank and I'm here to help you'. You have to worry when the bankers start to offer us with the super system. A trillion dollars attracts a lot of attention."
Is our super system world class?
"The Deloitte fee study & other research about performance relative to other nation's pension funds gives evidence for (the case our system is) world class."
"The Mercer study said we have the best super system bar the Dutch - measured in terms of adequacy, integrity & sustainability."
"Can we do it better? Yes, but the Auspoll research shows 80 per cent of Australians are confident in their super - you don't want to change that."
"We've had the biggest shock to the system in GFC and yet members stayed put."
On media coverage of super
"The super system has had a 'going over' by the media. The easiest point to describe the GFC was to focus on people's retirement investments - media could relate the GFC to the public and bring it back to them. Despite the enormous amount of negative media that started with the GFC, you can see with the Auspoll results that people are still behind and supporting the super system. I defy you to find a piece of public policy with that kind of support in any country."
On legislative risk to super
"Too frequently we've seen super be a political football and source of votes with popular measures put through."
"Political changes have impacted confidence - we know people are not putting any more money in because you keep changing the rules."
And finally, this comment: "The same amount of thought went into the recent budget changes to super that went into the changes to the employee share scheme changes" to spontaneous applause from an audience not given to overreaction.
Tuesday, November 17, 2009
Wednesday, November 11, 2009
Trustees urged to look longer term than the nation's leaders - ASFA Day 1 closing
In closing the day's proceedings, Dr Keith Suter countenanced three scenarios for the future world order - "business as usual", "break-up", "break-down" or "breakthrough".
In the "breakthrough" scenario, Australia is poised to make the most of a world in which both the economy and how we manage scarce resources are reinvented - to see the globe become both economically and environmentally more sustainable.
Speaking directly to those in the industry, Dr Suter argued that politicians in power, subject to the very short-term and immediate pressures of the 24/7 media cycle and electoral expediency, are unlikely to bring about longer term solutions or responses to these scenarios. With politicians focused on the short-term issues that dominate the news cycle, at the expense of future-defining issues, then other decision makers must pay more attention to the less urgent but more important "bigger" issues.
The most dominant of these bigger issues is the start, for good or ill, of a new global economic era.
Against this dramatic backdrop, Dr Suter urged fund trustees to take the longer term, and arguably braver, view. To look beyond existing paradigms to see what is, and what may be, and to plan for a number of very different scenarios.
Against this dramatic backdrop, Dr Suter urged fund trustees to take the longer term, and arguably braver, view. To look beyond existing paradigms to see what is, and what may be, and to plan for a number of very different scenarios.
While the future may not be certain, the obligations of those in the industry are - to safeguard the long-term wealth of Australians.
Carden Calder is attending ASFA 2009 for BlueChip Communication Group. BlueChip is Australia’s leading financial services communication firm. We help “tell your story” through media, online pr, compelling content and other forms of communication - so the people who matter most want to do business with you.
Carden Calder is attending ASFA 2009 for BlueChip Communication Group. BlueChip is Australia’s leading financial services communication firm. We help “tell your story” through media, online pr, compelling content and other forms of communication - so the people who matter most want to do business with you.
Member research - Super? What super? ASFA Day 1
On an individual member level, ASFA research conducted by Auspoll shows what superannuation members really think about it all. And the short answer is they don't really think.
At least they don't think much about their super.
At least they don't think much about their super.
When asked which superannuation issues caught their attention recently, the largest portion of respondents (47 per cent) could not think of any - and answered "none". Only some (29 per cent) offered losses or a decrease in the value of their investment, and a very small number (6 per cent) suggested fees.
Have people changed their investment options in response to market movements? Most (87 per cent) have not.
Which are the two most widely-held funds? Australian Super and AMP, by a considerable margin.
In terms of split between industry and retail, the survey found some 48 per cent were in industry funds, 29 per cent in retail and a far smaller proportion (3 per cent in each) were invested in a corporate or self-managed fund.
It seems members, in the wake of one of the worst years on record for returns, are largely satisfied (79 per cent of respondent) with their super funds - consistent with past findings.
Interestingly, those in the public sector and industry funds show far stronger satisfaction ratings than retail fund members.
Of the small number not happy, why is that? Most said it was about performance and / or fees.
For those who are happy with their fund, it's down to low or reasonable fees, performance and communication.
And finally, what do members looks for in a fund? Performance, reasonable fees, safety or security, and consistency and stability.
Five mega-trends & financial planning - ASFA Day 1
Graham Rich of brillient! and Portfolio Construction Forum spoke in the morning about his pick of the top five mega-trends affecting future portfolio construction outcomes.
The "mega-trends" may sound familiar, and were in fact echoed by other speakers: reformation of regulation, turbo of technology, movement of markets – particularly global emerging markets, the ETA of ESG, and retirement of retirement.
The one thing super funds should be doing over the next five years to respond to these trends?
Provide members with quality financial planning as a core service.
Rich threw out the challenge to trustees to choose just one of the five megatrends and commit to learning about it and collaborating with industry peers.
The "mega-trends" may sound familiar, and were in fact echoed by other speakers: reformation of regulation, turbo of technology, movement of markets – particularly global emerging markets, the ETA of ESG, and retirement of retirement.
The one thing super funds should be doing over the next five years to respond to these trends?
Provide members with quality financial planning as a core service.
Rich threw out the challenge to trustees to choose just one of the five megatrends and commit to learning about it and collaborating with industry peers.
Bank deposits versus super? ASFA Day 1
Dr David Morgan's view of the new global economic era is bank-centric, with both threats and opportunities for the superannuation industry.
The GFC revealed an inherent vulnerability within the local banking system, says Dr Morgan.
This Achilles heel is the low level of retail deposits which in turn leaves our banks dependant on foreign wholesale funding.
It was this foreign wholesale funding market that closed down completely at the height of the GFC. Were it not for the Government lending its AAA rating to local banks, they too would have closed down, says Dr Morgan.
The solution, according to Dr Morgan, involves changing the end destination of national savings – perhaps turning back the trend that has seen superannuation balances grow at the expense of bank deposits.
One potential way to do this is for tax reform to make bank deposits more attractive - and superannuation less attractive.
The GFC revealed an inherent vulnerability within the local banking system, says Dr Morgan.
This Achilles heel is the low level of retail deposits which in turn leaves our banks dependant on foreign wholesale funding.
It was this foreign wholesale funding market that closed down completely at the height of the GFC. Were it not for the Government lending its AAA rating to local banks, they too would have closed down, says Dr Morgan.
The solution, according to Dr Morgan, involves changing the end destination of national savings – perhaps turning back the trend that has seen superannuation balances grow at the expense of bank deposits.
One potential way to do this is for tax reform to make bank deposits more attractive - and superannuation less attractive.
Dr David Morgan & Dr Keith Suter - ASFA Conference Day 1
Global Financial Crisis, and the rise of China and India, were the twin themes that dominated the first day of ASFA's annual conference in Melbourne today.
Dr David Morgan, former Westpac CEO provided his perspective on these key issues in the opening plenary, and Dr Keith Suter, social and political commentator and Sunrise regular, closed with them this afternoon.
The common threads? That while the GFC may be over, the aftershocks will be felt for a long time. As we congratulate ourselves on how Australia has escaped the worst of the GFC, a new era is upon us.
BlueChip Communication MD Carden Calder is attending ASFA.
Sunday, October 18, 2009
Measuring media results...is there a perfect solution or just "make do"?
We measure media results several ways. I've shared some of them below. We're still searching for that perfect solution however, and very open to new and improved ways of measuring success.
There's no point talking measurement if the goal of media relations isn't clear. For the most part we find a typical institution or firm in financial services wants to either overcome an issue or build their profile - in order to deliver better business results.
Some examples include:
- Creating a positive reputation in consumer media that accurately reflects a fund's ethos and member offer
- Generating coverage that helps establish an asset manager's credentials among potential mandate clients
- Eliminating or redressing media perceptions (and continued reporting) that an organisation is less than committed to the market or a sector
- Generating greater understanding of the depth of expertise.
Knowing the end goal we can have a more constructive conversation about how to measure progress towards it.
Number of articles
There's the simple (and not elegant) count - number of articles. Yes, our clients are still very interested in sheer volume. It's an effective albeit crude measure of the effectiveness of public relations activity, particularly over time. Each year we can show most clients who are looking for proactive, brand-building coverage, an increase in the previous year's number of articles. Bearing in mind all these articles are positive, it's one way to track whether or not we have 'momentum' for a client.
Content analysis
This is really the only way to work out the overall tone (positive, neutral, negative) and focus (key messages or not?) of coverage. Unfortunately it's also time consuming and therefore expensive. Many financial services executives on limited budgets would rather have their consultancy spend time generating coverage than analysing the content - depending of course on volumes and how many issues are being managed.
Proactive versus reactive calls/activity
It's all very well us making all the calls, but we really know you have an effective media profile when the journos call you. This isn't an end game in itself - it's just a lead indicator, or input KPI, that tells us all whether our client is achieving a level of media interest that's self-sustaining.
Impressions - ideally target audience
Advertising agencies make very good use of measures like TARPs - target audience rating points. We track potential impressions using a methodology developed inhouse. Since we started tracking impressions we've seen some extraordinary results - so much so that some clients don't want to spend limited marketing dollars on advertising because their public and media relations efforts are far more cost effective at generating impressions among the target audience.
Advertising has an important place in the marketing mix, and always will. It's just that increasingly we find financial services institutions want to push more of a message out to their audiences than an ad can deliver. This is particularly true in Australia's highly intermediated retail and institutional wealth management sector.
Reputation studies
Media opinions do seem to lead onto reporting tone. And reporting tone does influence clients or consumers, investors and shareholders, business partners and employees. I tend to think if we're not measuring both the audience's perceptions and the intermediaries' (such as media and bloggers) perceptions then we probably don't have full information about exactly how (or whether) media relations efforts are having the desired impact.
Any thoughts out there on the Holy Grail of media coverage measurement?
There's no point talking measurement if the goal of media relations isn't clear. For the most part we find a typical institution or firm in financial services wants to either overcome an issue or build their profile - in order to deliver better business results.
Some examples include:
- Creating a positive reputation in consumer media that accurately reflects a fund's ethos and member offer
- Generating coverage that helps establish an asset manager's credentials among potential mandate clients
- Eliminating or redressing media perceptions (and continued reporting) that an organisation is less than committed to the market or a sector
- Generating greater understanding of the depth of expertise.
Knowing the end goal we can have a more constructive conversation about how to measure progress towards it.
Number of articles
There's the simple (and not elegant) count - number of articles. Yes, our clients are still very interested in sheer volume. It's an effective albeit crude measure of the effectiveness of public relations activity, particularly over time. Each year we can show most clients who are looking for proactive, brand-building coverage, an increase in the previous year's number of articles. Bearing in mind all these articles are positive, it's one way to track whether or not we have 'momentum' for a client.
Content analysis
This is really the only way to work out the overall tone (positive, neutral, negative) and focus (key messages or not?) of coverage. Unfortunately it's also time consuming and therefore expensive. Many financial services executives on limited budgets would rather have their consultancy spend time generating coverage than analysing the content - depending of course on volumes and how many issues are being managed.
Proactive versus reactive calls/activity
It's all very well us making all the calls, but we really know you have an effective media profile when the journos call you. This isn't an end game in itself - it's just a lead indicator, or input KPI, that tells us all whether our client is achieving a level of media interest that's self-sustaining.
Impressions - ideally target audience
Advertising agencies make very good use of measures like TARPs - target audience rating points. We track potential impressions using a methodology developed inhouse. Since we started tracking impressions we've seen some extraordinary results - so much so that some clients don't want to spend limited marketing dollars on advertising because their public and media relations efforts are far more cost effective at generating impressions among the target audience.
Advertising has an important place in the marketing mix, and always will. It's just that increasingly we find financial services institutions want to push more of a message out to their audiences than an ad can deliver. This is particularly true in Australia's highly intermediated retail and institutional wealth management sector.
Reputation studies
Media opinions do seem to lead onto reporting tone. And reporting tone does influence clients or consumers, investors and shareholders, business partners and employees. I tend to think if we're not measuring both the audience's perceptions and the intermediaries' (such as media and bloggers) perceptions then we probably don't have full information about exactly how (or whether) media relations efforts are having the desired impact.
Any thoughts out there on the Holy Grail of media coverage measurement?
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