Good governance rests on documented research, stated limits and decisions that can be explained. In our view, advisers should be able to see how it works and test it.
When advisers assess an investment manager’s governance, they need to see how it works in practice: who makes the decisions, what evidence those decisions are based on, what limits apply, and who is able to challenge them.
This has become more important as managed accounts have grown. Funds under management in Australian managed accounts reached $292.9 billion at the end of 2025.¹ Managed accounts offered through a registered managed investment scheme, as many platform separately managed accounts are, are regulated under Chapter 5C of the Corporations Act. Managed discretionary accounts offered outside a registered scheme are covered by ASIC’s Regulatory Guide 179, which is a useful benchmark for any managed account. It sets out, among other things, that the investment program be reviewed at least once every 12 months, that client assets be held on trust and separately, that conflicts of interest be managed, and that an auditor report each year on whether internal control procedures were documented and whether they ensured, as far as is reasonably practicable, compliance.²
In superannuation, APRA’s investment governance standard, SPS 530, makes the board “ultimately responsible” for the investment governance framework and requires each investment strategy to be reviewed against its objectives at least annually.³ SPS 530 does not apply to an investment manager such as Agentia. We use it as a reference point for good practice.
Features of good governance
In our view, good governance has four features. None of them is unusual, and each needs to be applied consistently.
Challenge within the investment committee
An investment committee is useful only if its members are willing and able to disagree. Agentia’s investment committee includes members who are not Agentia employees, and their role includes testing decisions alongside the people who build the portfolios.
Documented research
Every manager and exposure in a portfolio should have a documented rationale and a defined role. The CFA Institute’s Code of Ethics and Standards of Professional Conduct describes the requirement as having “a reasonable and adequate basis, supported by appropriate research and investigation” for any investment action.⁴ Documented reasoning can be reviewed later and compared with results.
Stated limits
Portfolios should move within stated ranges, and any move outside them should require a deliberate and recorded decision. At Agentia, a change outside a portfolio’s stated ranges requires investment committee sign-off.
Scheduled and event-driven reviews
We review the whole suite each year, and hold additional reviews when material market events warrant them. Reviews held only on a fixed schedule may not respond quickly enough to significant market events.
Questions advisers can ask
Advisers can assess a manager’s governance by asking direct questions. Who sits on the investment committee, and which members are not employees of the manager? Do any members have business relationships with advice firms that use the manager’s portfolios? How often does the committee meet, and are its decisions minuted? What happens when a portfolio needs to move outside its ranges? How are conflicts of interest identified, disclosed and managed? Can the manager explain why each holding is in the portfolio?
A manager with sound governance should be able to answer each of these questions clearly. The answers will not show how a portfolio will perform, and good governance does not remove investment risk. They will show whether decisions are made carefully and by people who are accountable for them.
Governance in Agentia’s portfolios
In our view, governance and simplicity are connected. A portfolio with fewer and clearer components is easier to oversee and easier to explain. We aim to give advisers enough information about how each portfolio is built for them to check the governance described here for themselves.
Sources
1. Institute of Managed Account Professionals (IMAP), “IMAP’s FUM Managed Accounts Census reports FUM total for 31 Dec 2025”, March 2026. https://imap.asn.au/imap-news.html?view=article&id=1307:fumcensus-update-dec-2025&catid=126
2. ASIC, Regulatory Guide 179: Managed discretionary accounts, issued 29 September 2016, updated 16 June 2025, RG 179.1–3, 179.67–87, 179.90 (Table 5), 179.99 and 179.140. https://download.asic.gov.au/media/djucm2zm/rg179-published-29-september-2016-20250616.pdf
3. APRA, Prudential Standard SPS 530 Investment Governance, effective 1 January 2023, paragraphs 12 and 28. https://www.apra.gov.au/sites/default/files/2022-07/Prudential%20Standard%20SPS%20530%20Investment%20Governance.pdf
4. CFA Institute, Code of Ethics and Standards of Professional Conduct, Standard V(A) Diligence and Reasonable Basis; Standards of Practice Handbook (updated April 2024). https://www.cfainstitute.org/standards/professionals/code-ethics-standards/standards-of-practice-v-a