The challenges facing this industry are significant and require input from all role players. By virtue of the sheer collective investment capacity represented by the retirement fund industry, the administration of such a vast amount of capital, valued at billions of rand, has far-reaching consequences in respect of the macro-financial stability of the country.
It is therefore not surprising that the retirement fund industry has, over the years, been subject to extensive legislative changes. The far-reaching changes occurring in the regulatory environment, including the removal of the audit exemption for many funds and new regulations governing investments, pose significant challenges for both administrators and trustees.
The shift in recent years from defined benefit to defined contribution schemes is largely complete, which increases the onus on retirement fund managers and trustees to balance the optimisation of investment returns with prudential retirement fund capital management.