Mercer Super chief in the race for global scale

The merger of Mercer Super and BT Super has created a $63 billion super fund yet Mercer Super is hoping to fuel its ambitious expansion plans by snapping up even more members.

Mercer Super boss Tim Barber says the merger with BT Super is a clear signal of things to come.

From where he sits, it's a game-changer.

As the only established Australian fund of its size that combines global and local scale, the chief executive argues that Mercer Super fundamentally transforms the domestic playing field.

At a global level, he adds, Mercer Super is bigger than even its largest local rivals.

Barber is not batting away further merger speculation. He sees more growth on the horizon for the fund.

However, he is not fixated on a particular number when it comes to asset size in Australia. This is because Mercer manages US345 billion globally, including the Australian super trust, which provides global scale.

Here, he has adopted an alternative path to achieving size.

"We're able to leverage the parent's scale to give us the buying power and position," he says.

"Having the weight of Mercer and Marsh McLennan behind us helps regardless of whether we manage assets of $60, 70 or $80 billion locally."

He notes that several of Australia's largest pension funds are just beginning to build up offshore teams, as 70 cents in every new dollar invested in superannuation is invested offshore.

Mercer has about 2,000 investment professionals in 43 countries.

"So, when you think about leveraging global expertise, whether that's research capability or ability to access investments on behalf of members, that's a tremendous advantage," he adds.

"A global perspective can allow for a deeper understanding of offshore markets, and we have access to that global expertise at our fingertips."

"Importantly, though, we also have a dedicated local team of investment professionals responsible for managing our investment portfolios."

"We're now one of the most competitive funds on fees and global expertise, there's a lot to be said for that in terms of where superannuation is going."

Deep pocketed parent

Also, being owned by the US$20 billion-in-revenue Marsh McLennan, Mercer Super can use corporate capital to help facilitate mergers or acquisitions and invest in member experience tools.

Mercer is a global organisation, and has capital backing by having a listed parent company.

This is where the fund differs from the other industry funds here.

"Essentially, we have capital backing from the parent company, which can be available for investing in member benefits such as ehancing our technology and digital tools," Barber explains.

"In the case of an industry fund, the only money available for such things is the members' money in the fund."

Barber argues that, unlike other smaller funds, Mercer Super is not merging to survive. "If you are a standalone fund, and you don't have capital backing there's potentially a survival issue. We don't need to do that," he claims.

For the former chief executive at Australian Unity Bank, the main job is beefing up the member experience member journey.

As a banker, he is used to customers frequently engaging with their lenders through an app. "Members are closer to other financial services providers than they are with their superannuation funds."

"We know consumers are engaging with digital tools more than ever before. But there's a gap here when it comes to engaging with their super.

"An important focus for Mercer Super is digitising the member experience to make super more visible, more accessible."

 Onboarding BT Super staff

Nearly everyone in BT Super wanted to come across to the merged entity.

"Few people opted not to continue with us," Barber says.

With the intense war for talent, he was keen to welcome so many people across to Mercer as they added important skill sets.

"Bringing together the best of both organisations not only allows us to deliver continuity of service to our 850,000 members but adds depth and breadth to our team, particularly in the areas of member experience, product and investments which are incredibly valuable as we continue to develop our super proposition.

"The Mercer Super leadership team has been redesigned with the focus on future growth and quality service front of mind."

Following the merger with BT Super, Mercer Super has a new chief investment officer and personal super and member experience leader.

Corrin Collocott joins as chief investment officer reporting to Mercer Pacific investment chief Kylie Willment.

Meanwhile, Andrew Wallace will lead the retention, growth and development of the super fund's personal super offering and member experience. Barber says one of the compelling reasons for the merger was to get the people like Corrin and Andrew.

"Essentially, Kylie is reshaping her team as the super trust has the largest proportion of assets managed by Mercer Pacific, so having its own CIO within that investment team made sense."

And, with the focus on retirement income and the end-to-end member journey Wallace's appointment into that new role highlights the fund's heavy push for digital tool use.

"Over the next 12 months, we are going to build new member portals, adviser portals, and employer portals so that our members, our clients and advisors can more easily engage with Mercer Super.

"Andrew brings a specific focus on individual members. Their journeys, and retirement outcomes, is a critical, critical part of that."

Since the merger, the super fund has added other capabilities. For example, Nicole Mathias-Browne joined Mercer Super as a marketing leader. Barber says Mathias-Browne is an example of an executive with solid superannuation industry nous and marketing and communication skills.''

With her help, the fund will be much more recognisable in the future, according to the chief executive who says Mercer Super is "fairly well known" in the industry but less so in the retail market.

"We are placing increased focus on strategic marketing and brand, watch this space," he adds.

"We've made strong progress organically, and the merger now provides the platform to keep shaping, growing and enhancing our offering for the benefit of those saving for and in retirement."