SUNBIZ

Why Appointing Right People On Superannuation Boards Critical, Explains A-G

Regional central bank representatives and superannuation fund executives yesterday heard the importance of appointing the right board members on superannuation fund boards. The Attorney-General and Minister for Economy, Aiyaz Sayed-Khaiyum,
03 Nov 2016 11:00
Why Appointing Right People On Superannuation Boards Critical, Explains A-G
From left: Asian Development Bank (ADB) Pacific Sub-Regional director Robert Jauncey, ADB Economic Research and Regional Cooperation Department senior advisor Ganeshan Wignaraja, Attorney-General and Minister for Economy Aiyaz Sayed-Khaiyum, FNPF Board chairman Ajith Kodagoda at the opening of the Strengthening Pension System & Health Coverage in the Pacific forum at the Grand Pacific Hotel in Suva yesterday. Photo: RONALD KUMAR.

Regional central bank representatives and superannuation fund executives yesterday heard the importance of appointing the right board members on superannuation fund boards.

The Attorney-General and Minister for Economy, Aiyaz Sayed-Khaiyum, emphasised not having the right type of expertise on the board can mean decisions by the board are skewered.

“You will not necessarily have the right input and expertise. At the end of the day, the rationale for having a board is to ensure your shareholders in a corporate setting get the best return.

“In this particular setting, you need the best people, so the members of the fund get the best return.”

Mr Sayed-Khaiyum stressed it was very critical the members of the fund know that their investment and their funds are secure.

He was speaking during the first regional workshop on improving social protection roles of Pacific Pension Systems at the Grand Pacific Hotel in Suva.

The two-day workshop is titled ‘Strengthening Pension Systems and Health Coverage in the Pacific’.

It is jointly hosted by the Fiji National Provident Fund and the Asian Development Bank.

 

No political interference

Also, Mr Sayed-Khaiyum stressed it must be ensured that there is no political interference in the day-to-day operations of the Fiji National Provident Fund.

“We must ensure that whenever we appoint a board, we appoint the best people who can contribute positively to the fund,” he said.

“It is a very sophisticated market we are developing. In order to ensure FNPF provides a good return to its members, it does need to sometimes invest offshore.”

Mr Sayed-Khaiyum highlighted that back in the 1960s, when the FNPF was introduced, it was a different era altogether.

He said the board membership of the superannuation fund included two or three people from Government, two or three from employer organisations and two or three from trade union organisations.

But, he said in the modern day and age, you need to have professionals running the organisation.

“This is given you have a growing population and have a large pool of funds, you have to make investments that are secured for the people who are contributing now to ensure it is sustainable,” he said.

“You need to ensure the people who are sitting on the boards are people who can contribute to that. It is not an issue about employer or employee or government representation.

“It is an issue about making sure you have people with financial background and the right background to do the job.”

Feedback:  rachnal@fijisun.com.fj


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