Superannuation funds are under increasing pressure to strengthen how they assess the operational risks of their investment managers, with evolving regulatory expectations and inconsistent approaches highlighting the need for greater rigour and consistency.
In response, ASFA, in collaboration with JANA, has today released its final Better Practice Guidance Note on Investment Manager Operational Due Diligence (Ops DD).
With CPS 230 now in effect and heightened expectations for operational resilience and third-party oversight, the Guidance Note provides a practical framework to help RSE Licensees meet their fiduciary and regulatory obligations. The Guidance note provides an evidence risk-based oversight and support framework that allows more consistent, comparable assessments of investment manager operational risks, including where investment managers are treated as Material Service Providers (unless a justified exception applies).
The Guidance Note is effective immediately and aims to complement APRA’s prudential framework, including SPS/SPG 530 (Investment Governance) and CPS/CPG 230 (Operational Risk Management), with important intersections with CPS 234 (Information Security).
Mary Delahunty, ASFA CEO, said, “The strength of our due diligence frameworks really matters to the integrity of the super system. So this work has consequences for every Australian worker and retiree. The Guidance Note gives the industry a consistent, practical method for assessing investment manager risk. It’s also timely. Quite rightly, regulators’ expectations around operational resilience are only moving in one direction, and that’s upwards.”
Jo Leaper, Head of Operational Consulting at JANA added, “Operational due diligence isn’t a tick-the-box exercise. In practice, there can be gaps between how processes are document and how they operate day to day. Effective due diligence is about understanding how an investment manager functions, and whether governance and controls are genuinely working under pressure. Clear roles and responsibilities, appropriate segregation between decision-making and oversight, and well-defined escalation pathways are fundamental to making due diligence meaningful.”
Key elements of the Guidance Note include:
- Positions Ops DD as a forward-looking, risk-based assessment requiring independent judgement, including evaluation of governance, controls and risk culture.
- Defines better practice principles, including clear roles and responsibilities, appropriate segregation of duties, independence from investment decision-making, and effective escalation pathways.
- Provides a more comprehensive review framework spanning governance, personnel, technology and cyber security, ESG factors, business continuity and data management.
- Recommends full ODD reviews at least every three years, supported by interim updates to reflect evolving risks and changes in manager operations.
- Clarifies that Ops DD reviews are complementary components of a broader risk management and audit framework.
The Guidance Note reflects extensive consultation with industry stakeholders, including asset owners, investment managers and consultants, and forms part of a broader effort to enhance governance, transparency and operational resilience across Australia’s superannuation system.
The Guidance Note is available here.
For further information, please contact:
Scott Roberts
ASFA Media Lead
mediaunit@superannuation.asn.au
About the Association of Superannuation Funds of Australia (ASFA)
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry, and the only industry body that represents all parts of the APRA-regulated system.
Our more than 100 members include retail, industry, corporate and public sector funds and their service providers. For over sixty years, ASFA has been the voice of super, advocating for a dignified retirement for all Australians. Through research, advocacy and collaboration, ASFA promotes efficiency, sustainability and trust in Australia’s world-class retirement income system.
About JANA
JANA is Australia’s largest investment consulting organisation and a trusted and respected partner of many of the country’s leading institutional investors. Since its inception in 1987 it has expanded its reach to over 80 institutional clients across superannuation, wealth, Not-For-Profits, insurance and more. JANA is fully management owned.
Total funds under advice as 31 December 2025 is A$1.7 trillion, while Implemented Consulting clients benefit from the scale of A$18 billion across the broader platform used for JANA clients.
For more information, please visit: https://www.jana.com.au