Hostplus has an obligation to always act in the best financial interests of our members and investors. While we believe it’s important for members and investors to have flexible access to their investments, we must also protect the longer-term interests of other members and investors. In certain circumstances frequent investment switches may be detrimental to other members or investors. This may particularly be the case when the switches relate to unlisted assets. That’s because these assets aren’t listed on the stock exchange, or other market, which means they aren’t valued daily in the same way as listed assets.
Hostplus is required to set and routinely review the design, distribution and use of our financial products. Additionally, the superannuation industry regulator (APRA) recently issued its updated Prudential Standard SPS 530 (Investment Governance) which provides guidance and requires all superannuation funds to review and as appropriate increase, extend and strengthen their investment governance frameworks and practices. This includes valuation practices, liquidity management and investment switching, to ensure member equity considerations are well managed and protected.
In response, we’ve recently updated our investment governance policies and processes. One particular area where we have enhanced our controls is around investment switching. This includes introducing new switching windows for our SMI Infrastructure and Property options.