Key Highlights

  • APRA says platform super trustees are the focus of its next Investment governance push.
  • Proposals would cap members' exposure to higher-risk investments.
  • The proposals are now out for consultation.
  • The push follows recent collapses in the sector.

Australia's prudential regulator has told a Senate committee that platform super trustees, the funds behind the investment menus many financial advisers use, are the focus of its next push on investment governance. The message matters now because APRA's proposed rules, released in September, would force trustees to cap members' exposure to higher-risk investments, a direct response to the harm exposed by the Shield and First Guardian collapses.

What APRA told the Senate

In his opening statement to the Senate Economics Legislation Committee on 29 October 2026, APRA Chair John Lonsdale said the package released "last month" was "the next phase of APRA's multi-year focus on lifting investment governance standards across the Superannuation industry, particularly within the platform Trustee segment".

He said "the proposals are aligned with the measures announced by the Government in August" to "strengthen consumer protection and increase the resilience of the superannuation system".

Mr Lonsdale's statement did not name Shield or First Guardian. But APRA's own September announcement of the proposals did point to those failures as examples of what can go wrong.

The collapses in the background

The Shield Master Fund and First Guardian Master Fund collapses have become the defining super scandal of the past two years.

In its 19 August announcement, the Government said the collapses were "impacting almost 12,000 people and around $1 billion in retirement savings".

The Government has said consumer harm can build across the chain of lead generators, advisers, trustees and products. Many affected members reached the failed schemes through platform super products, whose investment menus offered them as options.

Its August package set three goals: making the financial system safer through stronger protections across super, advice and investment; improving access to advice and guidance; and placing the Compensation Scheme of Last Resort "on a firmer and fairer footing". The detail is still to be legislated.

APRA Deputy Chair David Bradbury cited the Shield and First Guardian failures as examples of the serious harm that can occur when members hold concentrated positions in poor or unsuitable investment options, according to APRA's 30 September release.

What APRA is proposing

The proposals, released on 30 September, would tighten trustee requirements across eight risk areas. They centre on a marked-up draft of Prudential Standard SPS 530 Investment Governance, the standard that sets out how APRA-regulated trustees must manage investments. They are proposals only, open for an 18-week consultation, and are not yet binding.

APRA wants three new safeguards. Trustees would have to:

  • Set and enforce member-level limits on higher-risk investments;
  • Strengthen how they manage investment-related conflicts; and
  • Their investment oversight capabilities and resources should match the size and complexity of their investment menus.

There are also five changes to codify and strengthen existing expectations on investment onboarding, monitoring, remediation, valuations and accountability.

The changes would apply to all trustees, but APRA expects the greatest impact on platform trustees because of their broader investment menus, more complex products and greater reliance on financial advisers and other third parties.

APRA is also considering whether certain remuneration requirements that now apply to large trustees should be extended to complex trustees of all sizes.

"Trustees are ultimately accountable for the investments they make available to members," Mr Bradbury said in the release. He added that "material weaknesses in trustees' investment governance practices remain" and "policy reform is needed to strengthen trustee accountability".

Hypothetical example: how a member-level limit could work

Hypothetical example: APRA's summary of the proposals does not set a specific cap, so the figures below are invented purely to show the mechanics.

Suppose a platform trustee decided that no member could hold more than 20% of their super balance in any option it classifies as higher-risk.

A member with $200,000 in super could then hold no more than $40,000 in that option ($200,000 × 0.20). If an adviser recommended moving $150,000 into it, the trustee would have to block or limit the switch, leaving at least $110,000 elsewhere.

If that option later failed completely, the member's maximum direct loss from it would be $40,000, compared with $150,000 without the limit.

Real limits, if adopted, would depend on the final standard and each trustee's own risk settings.

Why platforms are in the spotlight

APRA has repeatedly flagged platforms. Mr Lonsdale told senators that APRA supervises institutions holding about $10.6 trillion in Assets across the financial system and is "sharing more data with our peer regulators – up 30 per cent this year".

In a speech on 22 October, Mr Bradbury said around $3.4 trillion is held in APRA-regulated super funds, according to an industry summary. He also said APRA has begun targeted readiness assessments of selected entities covering crisis preparedness, personnel risk and political risk.

Mr Lonsdale also noted that in August APRA launched its first civil penalty proceedings under the Financial Accountability Regime, the law that makes senior executives personally accountable.

For members, the practical point is that the trustee, not just the adviser, is accountable for what sits on the investment menu.

That marks a shift in emphasis. Much of the early response to the collapses focused on the advisers and lead generators who steered people into the schemes. APRA's proposals put more weight on the gatekeeper: the trustee that decided those Options could be offered at all, and how closely it monitored them afterwards.

Platform trustees, for their part, could raise questions in submissions about compliance costs, member choice and exactly how "higher-risk" investments are defined.

What to watch: key dates

  • 3 February 2027: submissions close on APRA's investment governance proposals.
  • First half of 2027: APRA expects to finalise the standards.
  • 1 January 2028: expected start date for the new requirements, subject to consultation.
  • Coming months: legislation to implement the Government's 19 August consumer protection measures, which the Government says it will develop in consultation with industry, consumer groups and regulators.
  • Ongoing: ASIC court action and compensation arrangements linked to the Shield and First Guardian collapses.