Australian Ethical and Christian Super are in talks to create a super-sized ethical super fund

Merger she wrote! Aussie super funds are joining forces.

What's the key learning?

Industry consolidation tends to happen when there are too many cooks in the kitchen.
This can be a good thing because under-performers are weeded out, but it also increases market concentration.

👉 Background: Australian Ethical and Christian Super are both ethical super funds. That means they strictly use their members retirement funds to focus on sustainable and ethical investments, while still making a tasty return for their members.

👉 What happened: Buuut..it turns out Christian Super has been underperforming on the government benchmark for super fund performance.

👉 What else: Now, government agency APRA says Christian Super has to find a merger partner by this June, because they just can't hack it alone anymore.

🔔 What's the key learning?

💡Industry consolidation tends to occur when an industry has too many players (or government regulation forces it). Back in 2010, there were a staggering 389 super funds in Australia. These days that's more than halved to 179.

💡 A recent report from KPMG predicted that these ongoing mergers will likely lead to around 12 mega funds, and not much else.

💡 The good part is that underperforming super funds will wither away, but there will also be an increased market concentration in a few big companies dominating a $3.3 trillion industry.

Disclaimer: Flux Technologies Pty Ltd (ABN 86 634 507 172) is an authorised representative (Representative No. 525288) of Mozo Pty Ltd who is the holder of AFSL No. 328141. We also provide general advice on credit products under our own Australian Credit Licence No. 530103. The product information presented does not constitute an offer and we are not recommending or suggesting any particular product. Any product advice presented is of a general nature only, and is not to be taken as any sort of advice as it has not taken into account your personal circumstances, objectives, financial situation or needs. Flux may not cover all products available to you. Check out our Credit Guide and Financial Services Guide for more information.

All information contained in the Flux app, www.flux.finance, www.joinflux.com, app.flux.finance and any podcast of Flux Media Pty Ltd (ABN 27 639 804 345) is for education and entertainment purposes only. It is not intended as a substitute for professional financial, legal or tax advice. Flux Media Pty Ltd is the owner of the registered trade mark, 'What the Flux'. While we do our best to provide accurate information on the podcast, we accept no responsibility for any inaccuracies that may be communicated.

Australian Ethical and Christian Super are in talks to create a super-sized ethical super fund

What's the key learning?

🔔 What's the key learning?

Ready to win at money?

Become smarter in just 3 minutes! ⏱️