Superannuation (prudential standard) determination No. 2 of 2022
RSE licensees that are part of a group[4RSE licensees that are part of a group[4]
Start here
Get a plain-English read of RSE licensees that are part of a group[4
Turn the raw legal text into a practical explanation grounded in Superannuation (prudential standard) determination No. 2 of 2022.
RSE licensees that are part of a group[4]
- Where an RSE licensee is part of a corporate group, and the RSE licensee utilises group policies or functions, the Board must approve the use of group policies and functions and must ensure that these policies and functions give appropriate regard to the RSE licensee’s business operations.
Investment governance framework
-
An RSE licensee must at all times have an investment governance framework to manage investments to meet the RSE licensee’s obligations to beneficiaries.[5]
-
An investment governance framework is the totality of systems, structures, policies, processes and people to address the RSE licensee’s responsibilities with regard to investments of each RSE within the RSE licensee’s business operations. An RSE licensee’s responsibilities include generating returns to meet investment objectives while managing and monitoring all identified sources of investment risk.[6]
-
The Board is ultimately responsible for the establishment, implementation, oversight and maintenance of an RSE licensee’s investment governance framework.
-
An RSE licensee’s investment governance framework must, at a minimum, include:
(a) investment objectives for each investment option offered by the RSE licensee;
(b) a methodology for determining investment reporting measures[7];
(c) the investment strategy for the whole of each RSE and for each investment option as required by section 52(6) of the SIS Act;
(d) all Board policies relating to investment activities;
(e) role statements that include the details of each role’s responsibilities and reporting structures for all roles related to investment activities;
(f) structures, policies and processes relating to investment activities, including for investment performance and risk measurement, assessment, stress-testing, valuations and reporting to the Board and senior management; and
(g) a review process to ensure that the investment governance framework remains effective.
-
An RSE licensee’s investment governance framework must be appropriate to the size, business mix and complexity of the RSE licensee’s business operations.
-
An RSE licensee must have procedures to ensure that all persons in roles related to investment activities of the RSE licensee are made aware of, and have processes and controls for monitoring compliance with, the RSE licensee’s investment governance framework.