House economics committee chair Tim Wilson recently asked a number of funds about their salary and bonus arrangements for employed advisers, as part of the committee’s regular inquiries into the super industry.
While most did not disclose the level of bonuses paid to their advisers, a number of significant industry funds including Hostplus and Sunsuper disclosed that they did award bonuses to staff employed to give both personal and general advice.
Hostplus stated that “all Hostplus employees are eligible to be considered in Hostplus’ performance linked incentive scheme”.
“The scheme is linked to the outcomes from the annual performance review process and only employees deemed to be top performers are considered for a performance linked incentive, and is not guaranteed to all employees,” the fund said.
Sunsuper said its advisers “are eligible for a bonus based on a balanced scorecard that includes achieving customer service-related targets, quality and compliance requirements and in accordance with conflicted remuneration provisions of the Corporations Act 2001”.
The fund disclosed its aggregate bonus value across all advisers for the 2020 financial year was $458,000, an average of $13,881 per adviser.
Aware Super, which has become Australia’s second largest industry fund this year following a slew of mergers with other funds including WA Super and Vic Super, said it also awarded adviser bonuses “based on a range of measures including demonstration of fund behaviours and values, compliance assessment and adherence to professional standards, and member satisfaction”.
Prime Super also stated that “financial advisers are eligible for a bonus based on the overall performance of Prime Super and personal performance”.
“The bonus is not based in any way on the volume of business written by financial advisers,” the fund said.
Among other major industry funds, both Australian Super and Rest stated that they did not award any bonuses to advisers.
Why do they need bonuses. I thought they were all “not for profit” and worked for the vibe? Clearly miss understood the propaganda being pushed out there.
These are the same funds which ran a derogatory ad campaign about bank staff getting bonuses. They are as toxic as AMP and that is a low hurdle to crawl under.
Balanced score card = how many clients did I “help”
Really to be labelled a Financial Adviser FASEA should have said that to act in the best interests of clients a range of different products should be available on an APL and offered to meet different clients needs. Any adviser with a cookie cutter approach offering one product should ethically or professionally not be allowed to be called an Adviser. Not too sure how the industry funds manage to get away with this.
Interesting, but not the main game. Most union fund advice is given by unlicensed sales and call centre staff who are not subject to Best Interest Duty, disclosure requirements, or FASEA. I suspect this is where most of the bonuses are paid too.
Good point.
Simply disgusting – 2 sets of rules, one ASIC.
What a load of complete BS.
They monitor vertically integrated sales, reward for retention and volume sales.
Then dress it up as anything but sales volume.
Let’s review see the top sales performers and be assured they get the bonus.
And to have a bonus that is not performance / volume based is just FARSEAcal anyhow.
Let’s base it on no. of client smiles, if you keep your desk tidy and kiss the bosses butt. BS
Nothing to see here people
Hello ASIC???
Oh, right sorry nothing to see here…. please continue with your bashing of ethical advisers while you find new places to hide your gifts registers
Amazing. Conflicted remuneration practises at its finest, you can’t tell me that retention and ‘new business’ isn’t two prime factors. And yet if we were doing that ASIC would come down on us like a tonne of bricks.
ASIC is corrupt
How many bonuses were awarded to industry fund advisers that recommended a member move their money to an alternative fund because it was in their best interest to do so ??
None, because to get the bonus includes “….. member satisfaction”. So it appears if you move the member out of the inhouse product the retail client will not get picked up in the member satisfaction survey and therefore no box ticked for bonus. Lesson it seems would be ALWAYS RECOMMEND THE IN HOUSE PRODUCT that way the PRODUCT MANUFACTURER might/will pay you a BONUS?