The Australian Prudential Regulation Authority set out a 2025 supervisory focus on governance across APRA-regulated entities, including heightened scrutiny of superannuation trustee spending and stronger expectations for board oversight of investment and operational risks. It also confirmed a review of core governance prudential standards across banking, insurance and superannuation aimed at simplifying and consolidating requirements. APRA released 2024 fund-level expenditure data for superannuation trustees and said it will publish the data annually, using it to identify outliers that may not appear to be in members’ best financial interests as part of its intensified scrutiny of trustee expenditure. On investment governance, it pointed to its thematic review of valuation and liquidity risk governance covering 23 trustees representing around 80% of assets managed by APRA-regulated superannuation entities, which found improvement since 2021 but identified 12 trustees needing material uplift in valuation governance and or liquidity risk frameworks, including weaknesses in board oversight and conflicts management. Operational capability and operational risk management were flagged as priorities in light of CPS 230 implementation this year and APRA’s view that superannuation operational systems often remain underdeveloped. A governance discussion paper is expected soon, with APRA intending to engage industry across superannuation, banking and insurance on clarifying, simplifying and consolidating governance standards including SPS 510 and SPS 520, while not revisiting different ownership models. The review is also expected to consider ways to streamline overlaps in accountability and fit and proper concepts, including duplication between “accountable persons” under the Financial Accountability Regime and “responsible persons” under the fit and proper standard.

Original source View in tracker