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.

 

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

Raising the GST to 15%

Treasurer Jim Chalmers aims to tackle tax reform but faces challenges. Previous reviews struggled due to political sensitivities, highlighting the need for comprehensive and politically feasible change.

7 examples of how the new super tax will be calculated

You've no doubt heard about Division 296. These case studies show what people at various levels above the $3 million threshold might need to pay the ATO, with examples ranging from under $500 to more than $35,000.

The revolt against Baby Boomer wealth

The $3m super tax could be put down to the Government needing money and the wealthy being easy targets. It’s deeper than that though and this looks at the factors behind the policy and why more taxes on the wealthy are coming.

Are franking credits hurting Australia’s economy?

Business investment and per capita GDP have languished over the past decade and the Labor Government is conducting inquiries to find out why. Franking credits should be part of the debate about our stalling economy.

Here's what should replace the $3 million super tax

With Div. 296 looming, is there a smarter way to tax superannuation? This proposes a fairer, income-linked alternative that respects compounding, ensures predictability, and avoids taxing unrealised capital gains. 

The rubbery numbers behind super tax concessions

In selling the super tax, Labor has repeated Treasury claims of there being $50 billion in super tax concessions annually, mostly flowing to high-income earners. This figure is vastly overstated.

Latest Updates

Investment strategies

Trump's US dollar assault is fuelling CBA's rise

Australian-based investors have been perplexed by the steep rise in CBA's share price But it's becoming clear that US funds are buying into our largest bank as a hedge against potential QE and further falls in the US dollar.

Investment strategies

With markets near record highs, here's what you should do with your portfolio

Markets have weathered geopolitical turmoil, hitting near record highs. Investors face tough decisions on valuations, asset concentration, and strategic portfolio rebalancing for risk control and future returns.

Property

Soaring house prices may be locking people into marriages

Soaring house prices are deepening Australia's cost of living crisis - and possibly distorting marriage decisions. New research links unexpected price changes to whether couples separate or silently struggle together.

Investment strategies

Google is facing 'the innovator's dilemma'

Artificial intelligence is forcing Google to rethink search - and its future. As usage shifts and rivals close in, will it adapt in time, or become a cautionary tale of disrupted disruptors?

Investment strategies

Study supports what many suspected about passive investing

The surge in passive investing doesn’t just mirror the market—it shapes it, often amplifying the rise of the largest firms and creating new risks and opportunities. For investors, understanding these effects is essential.

Property

Should we dump stamp duties for land taxes?

Economists have long flagged the idea of swapping property taxes for land taxes for fairness and equity reasons. This looks at why what seems fairer may not deliver the outcomes that we expect.

Investing

Being human means being a bad investor

Many of the behaviours that have made humans such a successful species also make it difficult for us to be good, long-term investors. The key to better decision making is to understand what makes us human and adapt.

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.