Inside your Member Newsletter Q&A with Deb James
I ntroducing a new investment option
upporting the S Motherâ€™s Day Classic
F inancial Planning Keeping your money safe 10 Choosing the right financial planner 11 12
A message from the CEO Catholic Super is strongly committed to promoting gender balance and diversity in our workplace. We continually seek ways to engage more women among our employees, in our management structure, in the governance of the Fund, and in the community more broadly. As a fund, we have a very high proportion of female members â€“ three-quarters of members are women! Helping to manage the financial futures of such a large number of Australian women is a great responsibility as well as a wonderful opportunity. At Catholic Super, we take this responsibility seriously. Supporting women at every level is intrinsic to our values. For us it not only makes good business sense to mirror our membership with higher female representation, it is also the right thing to do. Catholic Super is a strong advocate for the increased participation of women on Boards. The rationale is that greater gender diversity will lead to better decisions by Boards of Australian companies, which will enhance the value of our investments in those companies. Again, it is good business sense and the right thing. The Australian Council of Superannuation Investors (ACSI), of which Catholic Super is a foundation member, has called on companies to step up and increase the number of female Board members. We actively support this campaign, and share in its successes.
Catholic Super ranked as the top fund by members
Catholic Super members are the most satisfied members in the country in terms of both investments and service according to Roy Morgan Researchâ€™s The Superannuation and Wealth Management in Australia Report â€“ May 2015.
The world renowned business guru and author of In Pursuit of Excellence, Tom Peters, told the World Business Forum in Sydney last month that companies with the majority of women on their boards have performed a remarkable 56% better than those with women in the minority or no female representation. Since the campaign began, much has been achieved. Women now represent 30 per cent of all new Board appointments, compared with just 5 per cent in 2009 before ACSI and others began to raise the issue.
At Catholic Super weâ€™re constantly endeavouring to better engage women in our workplace. Frank Pegan, CEO, Catholic Super
By the end of 2014, women held almost 300 seats on Boards of ASX 200 companies. This represents 19 per cent of all Directorships, almost the double the proportion of female Directorships in 2010. The ACSI campaign is now being taken to a new level, with a goal to increase the number of female Board members to 30 per cent of all Directorships by 2017. This is to be achieved through dialogue with companies, especially those identified as laggards, and potentially by using voting rights to oppose the re-election of Directors. The Catholic Super Board currently has 30 per cent female Directors and will continue to promote opportunities for women to be nominated and elected by our members and employers.
Catholic Super is also tracking the gender balance of its employees. While we have not implemented targets, we have experienced a significant increase in female staff over recent years.
I am particularly proud that 50 per cent of our managers are female compared to the industry average of 36 per cent. We have also been working hard to increase the proportion of women in our client facing roles. In the finance industry, client relationship management and financial planning roles are predominately held by men.
Yet over the past two years Catholic Super has significantly increased the proportion of females in these client facing roles from 9 per cent to 33 per cent.
At Catholic Super weâ€™re constantly endeavouring to better engage women in our workplace. We know we still have work to do. We are still tracking below the average for female staff overall and within our Executive group, but we are focused on achieving better gender diversity over time. Catholic Super is proud to be a super fund that supports women at each stage of their careers and their lives. We believe our workplaces should reflect the diversity of our society as a whole.
It has long been acknowledged that engaged female talent is a key factor in business success, so we will continue to strive for greater gender diversity and reap the associated rewards for all our members. Frank Pegan, CEO, Catholic Super
Q&A We asked Deb James, Catholic Super Board member and General Secretary of the Independent Education Union (Victoria and Tasmania), for her thoughts on how gender diversity is progressing within the education sector. What do you see as the current gender diversity challenges in education? There are three main challenges in education when it comes to gender diversity. 1. Leadership positions – Women certainly have the numbers when it comes to teaching but are significantly underrepresented in leadership. In Victoria, more than eight out of 10 teachers in a Catholic primary school are female and in Catholic secondary schools more than 62 per cent of teachers are women. Yet women certainly don’t hold principalships in the same proportion. We need to look closely at the factors that give rise to this inequity and work to overcome the barriers, actual or perceived, to a more representative cohort of women attaining senior leadership positions across our schools.
2. Part-time impact on financial security – The number of part-timers in the education workforce is increasing. Teachers and support staff with young families or ageing parents need this flexibility to manage family commitments at different stages of their careers. Not surprisingly, most part time staff are women. Despite improvements in the conditions for part-time staff, they are still among the most vulnerable staff members in our schools. Variation of hours from year to year means income is variable and often a part-time fraction is whittled down over time so the part-time job you thought you could live on becomes unsustainable. The education sector must work on securing conditions for part-time staff and commit to embracing the growth in part-time work as the way of the future.
3. Support staff – In Victorian Catholic schools, some 80 per cent of our education support staff are women. These staff, integral to the running of our schools and the provision of quality education, are the lowest paid in our schools. They are much more likely to be part-timers with all the vulnerability that comes with that mode of employment, and too many of them are also on fixed term contracts. While wages and conditions for education support staff have improved significantly over time, there is still a long way to go to ensure they get the recognition and security they deserve.
Looking forward, how can the education sector help women and their careers in other industries? Educators are uniquely placed to effect real change over time. In working with students, teachers and education support staff are privileged to prepare the women and men who will lead in the future. They have an opportunity to educate boys and girls on issues of social justice, discrimination and equality. Our schools, both as places of learning and as workplaces, need to be inclusive, equitable and reflect diversity. In your career, have you encountered particular challenges or barriers because of your gender? I can’t recall ever being held back because of my gender. I went to secondary school in the 70’s at St Monica’s College in Epping, which was then an all girls school run by some pretty feisty Good Samaritan nuns and a group of very progressive lay teachers. They encouraged us to get on with what we wanted to do with our lives and told us that anything was possible. I went into primary teaching in Catholic schools and later into the union.
An independent review of the Catholic Super Board in 2014 found the Board to be an outstanding example of a robust values-based culture with a commitment to do the best for the people it serves. Our Board is 30% female. How important is the strong representation of women on boards? Over the decade or so that I’ve been on the Board, I’ve had the privilege of working with many strong, engaged, and capable women (and men!) who brought a distinct voice to the table which can only have enhanced our decision making. I’m confident our members benefit from the diverse views that come together in our common goal.
What excites you for the future of our teachers? Education is a very rewarding yet tough profession and the demands on teachers and education support staff are ever increasing. Yet again and again, teachers rise to meet them. There are great things happening in our schools from the energy, enthusiasm and commitment of principals, leaders, teachers and support staff. While they’re doing that, I’m proud to be working with Catholic Super to look after their income in a well-deserved retirement.
In Victoria more than eight out of 10 teachers in a Catholic primary school are female and in Catholic secondary schools more than 62 per cent of teachers are women. Deb James, Board Member, Catholic Super
The stellar run continues Investment update, May 2015
With just a couple of months to go before the end of the financial year, 2014/15 is shaping as another very strong year for investment returns. As at the time of writing (early-May) Catholic Superâ€™s Balanced Option has generated a return of 10.3% for superannuation members since 1 July 2014 (11.7% for pension members). If we end the year with a double digit return, this will represent the third successive year with such an outcome, indeed, 4 years out of 5. And with inflation at a relatively low level of around 2%pa, real investment returns have been well above our long term expectations. Listed equities have again been the key driver of the favourable returns this financial year, with both the domestic and overseas markets contributing strongly. It is noteworthy, however, that through the last 3 years all major asset classes have contributed. Through this period, no major asset class (counting domestic and global listed equities, private equity, infrastructure, property and fixed interest) has had a negative return in a single financial year, not even close. Indeed, all asset classes have delivered returns above our expectations (and above the expectations of other
observers). Furthermore, there have only been a small number of occasions through this period when markets have experienced a significant short term pull-back or correction. Of course, the global economy is now on a firmer footing than it was 3 years ago. In particular, the US economy has gathered momentum and even in Europe some positive signs are emerging. Nevertheless, it also noteworthy that the very favourable investment returns of recent years have occurred against a backdrop of unprecedented provision of liquidity to markets by central banks around the world, and with yields on government bonds falling to centuries-long lows, indeed into negative territory in many countries. Incidentally, the notion that any government bond could trade at a negative yield (which means that the price you pay exceeds what the government will pay back to you) would have been regarded as virtually unthinkable just a few short years ago. Today, there are many trillions of dollars of government bonds trading at negative yields.
Regardless of that, the very strong returns of recent years have not been matched by growth in underlying earnings or cashflows. This means that valuations are less favourable than was previously the case, be they expressed as price/earnings ratios and dividend yields on listed equities, capitalisation rates on property, discount rates on infrastructure projects, credit margins on corporate debt or of course yields to maturity on government bonds. There is a mountain of evidence indicating that across asset classes, starting valuations are a key contributor to returns achieved over subsequent medium to long term periods. On this basis, it is a near certainty that the very favourable experience of the last 3 years will not be sustained indefinitely. We urge all members to take this into account in their planning.
By Garrie Lette, Chief Investment Officer
Introducing a new investment option, RetireStable April 2015 The proportion of Catholic Super’s members who have reached the stage where they are eligible to invest in our pension options has increased rapidly over recent years. The investment needs of many members who are in or near retirement differ from those of superannuation or accumulation members. In particular: • Whilst pension members still wish to see growth in their investments over the medium to long term, they are more vulnerable to market downturns. This is because they are no longer working (or don’t intend to work for much longer) and so have less capacity to rebuild their balance over time in the event of a sharp market fall. • They are more vulnerable to an inflation shock. Many traditional assets will perform poorly in the event of an unanticipated period of high inflation, but in such a period pensioners will need to continue drawing on their balance, indeed at an increased rate due to the more rapid increase in the cost of living. In recognition of our increasing number of pension members, and their differing needs, in 2012 Catholic Super introduced a new investment option called RetirePlus. As of April 2015, we have introduced a second investment option focused on pensioners’ needs, called RetireStable.
The key differences between Retire Plus, Retire Stable and our largest superannuationoriented option, Balanced, are: • All three options have allocations to listed equities, both Australian and overseas, in recognition of members’ growth needs. The strategic allocation to listed equities of the new option, RetireStable, is 21%. This is lower than that of RetirePlus (37%), which is itself lower than that of our Balanced option (54%). • All three options have allocations to other investments with growth exposure such as credit, property and infrastructure. Again, RetireStable has an allocation to these investments below that of RetirePlus which itself has a lower allocation than Balanced.
Introducing a new investment option, RetireStable continued • For both RetireStable and RetirePlus, within both domestic and global equities, we use managers appointed specifically because we expect them to provide some protection against a sharp fall in equities markets. Accordingly, in the event of a sharp market fall, we would expect RetirePlus and RetireStable to perform better than Balanced, both because of their lower allocations to listed equities and because of better performance within those key asset classes. • Both RetirePlus and RetireStable have an allocation to a fixed interest oriented strategy which can be regarded as “inflation aware”. This strategy is intended to provide some further protection against inflation over and above that incorporated into our superannuation-heritage investment options, including our Balanced option. Naturally, the lower allocation to equities and other growth-oriented investments within RetirePlus and especially RetireStable, and the focus on downside protection, will mean that these options can be expected to perform less strongly than our Balanced option in periods of strong equity performance.
In short: • RetireStable should provide some growth over the medium to long term, but less than RetirePlus and especially Balanced; • RetireStable can be expected to provide greater stability from year-to-year. We expect that the trade-off between risk and return offered by Retire Plus and now RetireStable will be attractive to many of our pension members. Please talk to one of our financial planners to discuss your particular needs in more detail.
Mother’s Day Classic Thousands of Australians got their pink on this Mother’s Day for a good cause Catholic Super is proud to be an ongoing supporter of the Mother’s Day Classic, the annual national fun run and walk for breast cancer research. Initiated and organised by the advocacy group Women in Super, the Mother’s Day Classic has a strong connection with the superannuation industry. And as more than three-quarters of Catholic Super’s members are women, the Fund’s support takes on a deeper meaning. The event has grown to see more than 135,000 people join in each year, at 95 locations around Australia. The event has raised $24.3 million for breast cancer research since it began in 1998 (excluding the 2015 event).
Research is the key to improving survival rates of the one in nine women who will be diagnosed with breast cancer by the age of 85. Held on what is a special day to celebrate mums everywhere, the Mother’s Day Classic is a positive, healthy and inspirational event that brings the community together to support and remember those touched by breast cancer.
Sharon Morris, CEO of the Mother’s Day Classic, said it was great to have such a high level of support and participation by Catholic Super.
What comes out loud and clear from Catholic Super is that it’s very much about their members, encouraging their members to get involved in the event and having that good values side to what they do and what they believe in. Sharon Morris, CEO, Mother’s Day Classic
Keeping your money safe Catholic Super supports the Australian Government’s advertising campaign to counter the risk of bad advice in the financial planning industry. The MoneySmart campaign is in response to numerous recent scandals involving financial advisers employed by some of the nation’s biggest banks, where compensation payouts have been made to wronged clients who have potentially received bad advice. At Catholic Financial Services, our financial planners focus solely on the needs of our members. As Mr Frank Pegan, Catholic Super CEO explains, “our financial planners receive a salary – never commissions, bonuses or trailers to recommend particular products. This means you can trust Catholic Financial Services planners to provide advice only in our member’s best interests,” he said.
“Our financial planners enjoy working at Catholic Financial Services as there is no pressure to ‘sell’ – the only requirement is to do the right thing by our members. We fully support the Australian Government’s MoneySmart campaign and would encourage all members to do their homework before choosing a financial planner,” Frank said.
Further information For further information about the MoneySmart campaign see www.australia.gov.au/moneysmart and see our checklist about what to look for when you need financial advice.
Choose the right financial planner
Choosing the right financial planner – questions you should ask Is the financial planner licenced? Always look for a planner who works for a firm that holds an Australian Financial Services (AFS) Licence issued by the Australian Securities and Investments Commission (ASIC). You should ask for a copy of their Financial Services Guide. Catholic Financial Services is fully licenced. Is the financial planner a member of the Financial Planning Association (FPA)? The FPA is Australia’s leading professional community of financial planners. Members of the FPA must meet stricter criteria and higher standards than required by law.
What experience does the financial planner have and what services can s/he offer you? It’s a good idea to find out everything you can about the planner, including his or her experience and qualifications. Check references if possible. Ask what typical clients are like and how their portfolios have performed. You should also ask the planner about the services provided and what types of investments they are licenced to offer. Look for a financial adviser who provides ongoing services to advise and assist in your plan’s implementation, as well as future plan revisions.
How does the financial planner charge his or her fees? Most advisers offer an initial meeting at no cost. It’s important to find out whether the financial planner is salaried or whether they operate off commissions/ trailers. A person who earns a salary is more likely to provide advice in your best interest. Find a financial planner with a strong track record of providing the services you need at a reasonable cost. Do you have rapport with the financial planner? Rapport and trust are essential. Your financial planner is going to know more about you than your accountant or doctor, as he or she will have details of your finances, medical history and family situation. If you can’t establish that rapport early on in your first meeting, keep looking.
fresh new look
and online services for you
To ensure we continue to meet our members’ needs and satisfy government regulations, we have enhanced and upgraded our technology platform and launched a new range of services and products. As part of the upgrade, you’ll notice a change to our online services that make the administration of superannuation easier for members and employers.
EOFY MyLife Online, formerly known as Member Online, was launched in April 2015 and provides our members with 24/7 access to their superannuation account, which is accessible through our website at www.csf.com.au. This upgrade includes the release of new BPAY Biller codes and references unique to each member, as detailed under the contributions tab within their MyLife Online superannuation account. These provide our members with a more secure and efficient BPAY method to make contribution payments that are processed straight into their Catholic Super account. Throughout 2015, we will also launch a suite of additional MyLife branded services including: • MyLife MyPortfolio, a member direct investment service; and • MyLife MyInsurance for member insurance. “Catholic Super now has the means to access new markets and take our services to a more sophisticated level with plans to be more mobile while retaining our personal and dedicated service to Catholic Super members,” Catholic Super CEO, Mr Frank Pegan said. The rollout of MyLife services to Catholic Super members coincides with changes to our Trust Deed. From 1 April 2015, the name of the trust changed to MyLife MyMoney Superannuation Fund, with Catholic Super as a division.
End of financial year reminder: Top up your super The end of the financial year is fast approaching. If you would like to make an additional personal super contribution payment, please use the new BPAY Biller code and reference (detailed under the contribution tab your MyLife Online superannuation account) and your payment will be paid straight into to your Catholic Super account.
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Inspired by the love of The Velveteen Rabbit – A Catholic Super member story
A beloved family story book has become the inspiration for a mural which Judy and Jon Nelson hope will encourage other children to read. For eight consecutive days last month, Jon and Judy Nelson worked up to 14 hours a day, applying their paintbrushes tirelessly and skilfully outdoors in the bracing northern Tasmanian weather. Not for the faint-hearted. But for the Nelsons, who moved to the town of Westbury, Tasmania a year ago, it’s part of their retirement dreams coming to fruition. Judy’s mini-mural, ‘A little rabbit’s dream’, had been entered and selected as one of nine finalists to compete in the international Mural Fest in the neighbouring town of Sheffield, Tasmania. This earned her the right to compete in the annual ‘paint-off’ – where each finalist’s mini-mural must be recreated in a purpose-built park, on a space about 2.5m wide and 5m tall, within eight days. Both gifted artists and teachers, Jon and Judy Nelson spent the majority of their working lives inspiring hundreds of students at various secondary schools and
TAFE institutes. But even though they are recently retired, they are certainly not finished inspiring others. ‘A little rabbit’s dream’ is Judy’s interpretation of the Mural Fest theme for 2015, ‘Window of our dreams’. It was inspired by a children’s book written in the 1920s, The Velveteen Rabbit, which was the Nelsons’ favourite story to read to their young children in the 1980s. The story is about the strong bond formed between a boy and his soft toy. Judy and Jon hope the mural will encourage more families to read and love books the way they did. “We always loved The Velveteen Rabbit, it’s very stirring stuff. It pulls on the heart strings,” Jon said. It was the pair’s first Mural Fest, but it won’t be their last. They intend to enter next year’s competition as well. The plan is to build Judy’s profile as an award-winning artist and ultimately establish a small cottage industry that will feature her art.
We always loved The Velveteen Rabbit, it’s very stirring stuff. It pulls on the heart strings.
Originally from the US, the Nelsons moved from their hometown in Wisconsin to the eastern suburbs of Melbourne in the 1970s, to meet demand for high school teachers in Australia. Soon after they moved, they took a holiday to Tasmania and found themselves going back again and again.
that the couple had fared well by “stacking away as much super as possible” and utilising a pre-pension plan. He particularly valued the fact that Catholic Financial Services planners are salaried, and don’t receive commissions.
“We couldn’t have done this without Catholic Financial Services. Our planner orchestrated the whole thing. His advice was priceless,” Jon said.
“After about 10 trips, Judy and I started working with our financial planner and we found we had the means to retire down here,” Jon said. Jon and Judy spent five years researching and eventually found a house, which was originally built as the commandant’s residence 184 years ago during convict settlement. “That’s what brought us to Tassie, the people, the environment. Why Westbury? The home. It was built by convict labour. It’s got huge stone fences; it’s got a natural well. We just fell in love with it,” Jon said. Jon, a Catholic Super member since 1990, credits ongoing advice he received from Catholic Financial Services for the couple’s retirement position. He said it had been necessary to alter their financial plans a number of times, as a result of legislative changes and following the Global Financial Crisis, but
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Issued by CSF Pty Limited (ABN 30 006 169 286; AFSL 246664), the Trustee of the MyLifeMyMoney Superannuation Fund (ABN 50 237 896 957; SPIN CSF0100AU). The information contained herein is about the Fund and is general information only. It has been prepared without taking into account your personal investment objectives, financial situation or needs. It is not intended to be, and should not be construed in any way as, investment, CS071 010615 legal or financial advice.