APRA hits Aus Ethical Super with license conditions

Mike Taylor

Managing Editor and Publisher

27 November 2025

The Australian Prudential Regulation Authority (APRA) has imposed additional license conditions on Australian Ethical Retail Superannuation Fund over expenditure management.

The regulator said the imposition of the conditions followed intensified scrutiny of fund expenditure which included a review of the fund’s related party expenditure practices.

“APRA’s review identified deficiencies regarding the robustness of AES’s approach to related-party expenditure, particularly in relation to investment management agreements with its parent company, Australian Ethical Investments,” the announcement said.

“AES has not demonstrated that it has adequate processes to scrutinise and justify how the fees it pays to its parent company are consistent with the best financial interests of members.”

“Under the additional licence conditions, AES will be required to appoint an independent third party to review and recommend improvements to these outsourcing decisions and enhance compliance with key regulatory duties, and to implement any recommendations made.”

APRA Deputy Chair Margaret Cole said: “APRA expects trustees to have robust policies and procedures in place to uphold strong governance practices, appropriately manage conflicts and prioritise the financial interests of their members.”

“Implementation of the additional licence conditions will support improved outcomes for AES’s members and ensure that there is an appropriate level of independence, rigour and transparency regarding expenditure decisions.”