Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 273

Garry Weaven on 5 areas of super investment

[Introduction: Garry Weaven chairs IFM Investors, a fund manager owned by 27 industry superannuation funds with over $100 billion in assets under management. This article reports on his presentation at the 2018 Australian Institute of Superannuation Trustees' Super Investment Conference in Cairns on 5 September 2018].


Garry Weaven started with a slide showing superannuation assets will grow from the current $2.6 trillion to $6 trillion in 2030, a more than doubling in size, while GDP would increase from $1.3 trillion to $1.9 trillion. It demonstrated super’s growing role in the Australian economy. Said Weaven:

“The business community and governments of any persuasion would be totally mad looking at those numbers not to pursue greater collaboration with super funds.”

He then identified five areas of potential growth for superannuation investment:

  • Corporate debt
  • Infrastructure
  • Residential property/affordable/social housing
  • Agriculture
  • Growing new industries

Edited transcript of Weaven's future focus on these five areas

"Generally speaking, the corporate debt field has been left to the big banks and their large credit assessment teams but the changing regulatory environment is restricting bank balance sheets from fully servicing that sector. They will focus more on lower risk or higher profit businesses. This will expand opportunities for our sector to step in, possibly in partnership with the banks. Something like $95 billion per annum is lent to non-financial corporations from the banking sector each year. It’s potentially very big business that can be addressed by us.

Second on infrastructure, almost everyone agrees we could spend hundreds of millions over the next decade if we could get the correct frameworks in place. I’ve been arguing there is a better way, a partnership approach between governments and the superannuation sector where a bargain will occur in a very transparent way about the target rate of return on particular projects with risks allocated between the parties. There would be a ceiling above which the taxpayers would share in any outperformance. The manager should not make windfall profits. The deal once negotiated would be offered to every registered superannuation fund in Australia.

Third on residential property, the first investment ever made by IFM Investors' predecessor was to assist people into affordable housing. In the thousands of seminars since, housing and affordability has got worse. It’s time something was done.

Fourth, some of you will have noticed rural politicians squawking about agriculture, lamenting the fact that superannuation funds were not investing more. The reason is very simple: the returns are very poor and the volatility is substantial due to commodity prices and drought. The reason large offshore investors are able to come in here and invest in a significant way is because they can participate in the margins of the downstream processing or distributions of the agricultural output in the destination markets – China or Canada or wherever it is. If the government wants to do something useful in the area, it should be using its trade and foreign affairs diplomacy to broker deals where the super sector could partner with some of those organisations so the returns would be more attractive.

The fifth thing is industry policy generally. A really bold view would include governments collaborating with the super industry in the development of proactive industry policy."

Weaven called for a new era of cooperation between industry funds and the Coalition:

“Over 35 years of history in the industry fund movement, we’ve hardly had a year go by where there hasn’t been some attack in one form or another from the Coalition, in either government or opposition. There could be an emergence of an opportunity for all of that conflict and opposition to finally turn to collaboration, at least to some degree, between the business community, the super sector and governments – both state and federal.”

 

Graham Hand is Managing Editor of Cuffelinks. Garry Weaven is Chair of IFM Investors. As ACTU Assistant Secretary in the 1980s, he played a seminal role in the development of the industry superannuation fund movement.

 

  •   26 September 2018
  • 1
  •      
  •   

RELATED ARTICLES

Are lifetime income streams the answer or just the easy way out?

Two Labor policies facing inadequate scrutiny

Super boost: more flexibility for retirement

banner

Most viewed in recent weeks

The growing debt burden of retiring Australians

More Australians are retiring with larger mortgages and less super. This paper explores how unlocking housing wealth can help ease the nation’s growing retirement cashflow crunch.

Four best-ever charts for every adviser and investor

In any year since 1875, if you'd invested in the ASX, turned away and come back eight years later, your average return would be 120% with no negative periods. It's just one of the must-have stats that all investors should know.

Preparing for aged care

Whether for yourself or a family member, it’s never too early to start thinking about aged care. This looks at the best ways to plan ahead, as well as the changes coming to aged care from November 1 this year.

Our experts on Jim Chalmers' super tax backdown

Labor has caved to pressure on key parts of the Division 296 tax, though also added some important nuances. Here are six experts’ views on the changes and what they mean for you.        

LICs vs ETFs – which perform best?

With investor sentiment shifting and ETFs surging ahead, we pit Australia’s biggest LICs against their ETF rivals to see which delivers better returns over the short and long term. The results are revealing.

Family trusts: Are they still worth it?

Family trusts remain a core structure for wealth management, but rising ATO scrutiny and complex compliance raise questions about their ongoing value. Are the benefits still worth the administrative burden?

Latest Updates

Investment strategies

LICs vs ETFs – which perform best?

With investor sentiment shifting and ETFs surging ahead, we pit Australia’s biggest LICs against their ETF rivals to see which delivers better returns over the short and long term. The results are revealing.

Retirement

The growing debt burden of retiring Australians

More Australians are retiring with larger mortgages and less super. This paper explores how unlocking housing wealth can help ease the nation’s growing retirement cashflow crunch.

The ASX is full of broken blue chips

Investing in the ASX 20 or 200 requires vigilance. Blue chips aren’t immune to failure, and the old belief that you can simply hold them forever is outdated. 

Shares

Buying Guzman y Gomez, and not just for the burritos

Adding high-quality compounders at attractive valuations is difficult in an efficient market. However, during the volatile FY25 reporting season, an opportunity arose to increase a position in Mexican fast-food chain GYG.

Investment strategies

Factor investing and how to use ETFs to your advantage

Factor-based ETFs are bridging the gap between active and passive investing, giving investors low-cost access to proven drivers of long-term returns such as quality, value, momentum and dividend yield. 

Strategy

Engineers vs lawyers: the US-China divide that will shape this century

In Breakneck, Dan Wang contrasts China’s “engineering state” with America’s “lawyerly society,” showing how these mindsets drive innovation, dysfunction, and reshape global power amid rising rivalry. 

Retirement

18 rules for ageing well

The rules to age successfully include, 'the unexamined life lasts longer', 'change no more than one-eighth of your life at a time', 'nobody is thinking about you', and 'pursue virtue but don’t sweat it'.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.