PLANADVISER - Spring 2023 - 2

Publisher's Note //
publisher: Alison Cooke Mintzer
Alison.Mintzer@issmediasolutions.com
A Super System
I
creative director: SooJin Buzelli
SooJin.Buzelli@issmediasolutions.com
managing editor: Judy Faust Hartnett
Judy.FaustHartnett@issmediasolutions.com
recently spent a week at our Institutional Shareholder
Services offices in Sydney, meeting team
members of our four Australia media brands:
Financial Standard, FS Sustainability, Industry Moves
and Money. It was great getting acquainted with new
colleagues-something that I know, with the amount
of mergers and acquisitions happening, many advisers
have experienced lately. And I loved learning more
about their retirement system, something these publications
cover in depth.
For years I've been aware of the Australian universal workplace retirement
system, called the Superannuation Guarantee, known simply as " Super " to
my colleagues down under. In the U.S., it often gets cited as an example when
experts discuss our Social Security system and ways to make it more individualized
vs. pay-as-you-go.
In practicality, it shares many similarities with Social Security-in that it
has near universal coverage and mandated contributions from both employers
and employees-and also with our 401(k), 403(b) and other defined contribution
plan systems, as the investment risk is borne by the individual worker.
Considering that the Australian system has been heralded as superior for
years, I was struck at how some measures have taken time to be finalized. A
notable one is implementing " the right " contribution amount. This has increased
incrementally, from 9% in 2002 up to 12%, taking effect in 2025.
With all the knowledge of behavioral economics and inertia that has so often
led to policy discussions here, I questioned how Australians were expected to
select a provider and investments for the mandatory retirement contributions.
In Australia, an employee has the right to select a Super provider-and this
was apparent from all the ads for financial firms I couldn't escape when turning
on the TV in my hotel room. But if the worker doesn't choose one, the employer
has a default provider. Similarly, while workers may direct their own investments,
the provider does have default options for any who feel ill-equipped to
make those decisions. Perhaps most interesting to me was to dig into some of
the more recent initiatives to aid people who had accumulated multiple Super
accounts, helping them consolidate the accounts to avoid having fees eat up their
savings or, alternatively, to avoid losing track of the accounts. Sound familiar?
This reinforces some work we've seen here in the U.S. about the need to help
plan sponsors help workers aggregate their accounts so they can better project
their future income picture and see where improvements are called for.
One interesting framing element was that, when looking for a job in Australia,
job-seekers have to ask whether the compensation is being advertised " with
Super " or " ex-Super, " meaning if someone is offered $100,000 AUD [Australian
dollars], will she expect to have the mandatory contribution removed from that
or added on top of that? We don't always think about match rates in the same
way here, because vesting can mean some people don't get the match dollars as
" theirs " for years. But it reinforces to me the value of thinking about benefits as
part of total compensation and communicating that whenever possible.
As we here in the U.S. continue to see initiatives from the government and
public policy groups about how to improve our retirement savings system, it's
intriguing to consider how things are done on the other side of the globe.
-Alison Mintzer, Publisher
P.S. We've changed the format of PLANADVISER magazine to better serve our readership.
Please share your feedback @alison.mintzer@issmediasolutions.com.
editorial staff: Natalie Lin, Paul Mulholland,
Alex Ortolani, Remy Samuels, Karen Wittwer,
Jonathan Yardley, Noah Zuss
contributors: Beth Braverman, Rebecca Hourihan,
Ed McCarthy, Judy Ward
surveys & research: Garrett Cox, Kimberley
Gonzalez-Quiles
design & production: Donna Bien-Aimé,
Alanna Jacobs, Maria Kofman, Samantha Yu
design contributor: Cherese Rambaldi
art contributors: John Jay Cabuay,
Mar Hernandez, Matt Kalinowski, Alex Eben
Meyer, OYOW, Ryan Peltier (cover), Valeria
Petrone, Gizem Vural, Changyu Zou
strategy & operations: Michelle Lamison;
Melissa Groccia, Rebecca Moore
commercial director: Rob Reif
Robert.Reif@issmediasolutions.com
advertising sales: Katie Bacon, John Bennett,
Christopher Janos, Bill Murray
conferences: Carol Popkins; Katie Campbell,
Rebecca Fahey, Lucille Velander
accounting operations: Mayrillane Bahi,
Ruth Fissaha, Ricky Kostik
technology operations: Darrell Cheng, Bhakti Patel,
Jigar Patel, Dexter Reaves
PLANADVISER is owned by
Institutional Shareholder Services Inc. (ISS)
president and chief executive officer: Gary Retelny
chief financial officer: Allen Heery
PLANADVISER (ISSN 1935-9098) is published
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2 planadviser.com | Spring 2023 | Participants Photography by Matt Kalinowski
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PLANADVISER - Spring 2023

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