Posted: 17 December 2021
From Scott Durbin, CEO Commonwealth Bank Group Super:
We regularly assess the performance of our fund across a number of areas, including fees and past investment performance, and regularly test that investment objectives are improving the quality of our portfolios.
We are in the process of implementing a number of strategic initiatives and investment portfolio changes to improve future investment performance and our product offering, and enhance our members’ retirement incomes.
Historically, including over the past few months, where underperformance or areas for improvement were identified in our investment strategy and our investment portfolios we implemented a range of enhancements that are expected to improve future returns.
We have understood from members’ feedback in relation to investment performance that they are prepared to seek higher returns with the risk of increased volatility. On this basis we are making (and in some cases have already made) the following investment portfolio changes with long-term returns in mind.
Our Multi-Asset managers have been instructed to move portfolios to be more in-line with the benchmarks used by APRA. In addition to being more aligned with APRA benchmarks, we believe this approach alongside other changes in the portfolio will result in enhanced risk/return outcomes for our members over the long term.
We have reviewed our Alternative assets portfolio and introduced private and alternative credit into the portfolio to strengthen returns while driving further diversity within our investment options. In addition we have appointed a new ‘Alternative Risk Premia’ fund manager, Fulcrum, to the Alternative assets portfolio. We anticipate that Fulcrum’s expertise, track record and competitive fees will add value to our broader investment portfolios.
Within our Real Assets portfolio, we have divested from the Mount Pleasant Shopping Centre in Queensland which has been a long standing retail property holding in the portfolio. The sale fits with our long-term objectives for our property and infrastructure portfolios, and that is to invest in the higher performing sectors of the property investment market.
We have also added a number of small solar energy projects across South Australia, Victoria and New South Wales to our infrastructure investments. These additions to our portfolio enhance the investment proposition for our Real Assets portfolio but importantly support of some of our Climate Action Plan objectives. To read more see our Environmental, social & governance (ESG) Policy.
Further, as part of our regular strategy reviews, we continue to explore areas for further enhancement, including for example the continued build-out of our Real Assets portfolio to participate in exciting long term property and infrastructure opportunities. We believe the fund’s current long term.
investment strategy, including the changes outlined above, mean our portfolios are well placed to provide enhanced return outcomes into the future.