As of June 30, Australian superannuation funds will need to begin disclosing sensitive private fund information. Reforms made by the Australian Prudential Regulation Authority (APRA) will require trustees of superannuation funds to disclose information such as fees and costs payable by the fund, asset allocation percentages, and the value of direct and indirect investments held.
For private equity managers, the risk is having commercially sensitive fund information released to the wider public. GPs with superannuation investors will have all of their assets listed on the organization's website. Disclosures will need to be made every six months and in addition to identifying each asset, they must also report each asset's current value.
“It is important that APRA’s publicly released statistics facilitate and encourage analysis of whether the superannuation industry is achieving retirement income policy objectives over the medium to long term, and contribute to enhanced transparency, accountability and understanding of the superannuation industry,” APRA Member, Helen Rowell, said in a statement.
According to a client alert from law firm King & Wood Mallesons SJ Berwin, structures have been developed that may keep this information out of the public domain for some funds, but these will need to be assessed on a case by case basis.
Moreover certain disclosures may be exempted from the reforms if the APRA includes exemptions for sensitive market information, the memo said. However, this point remains unclear until final regulations are published.
GPs hoping to rely on confidentiality provisions in the partnership agreement should also be aware that the new disclosures rules will override those types of provisions.
Consequently, fund managers faced are faced with the dilemma of whether or not to accept commitments from Australian superannuation funds (who will need assurances prior to investing that the information required will be forthcoming), the memo continued.
Fund managers who already have Australian superannuation money in active funds will have no choice but to prepare themselves for the inevitable disclosure requests and identify what information they will be required to disclose to these investors.