On 10 February 2026, the Australian Treasury (Treasury) published a consultation paper titled Enhancing oversight and governance of managed investment schemes which seeks feedback on proposals to strengthen governance, compliance and regulatory oversight of registered managed investment schemes (MISs) in Australia.
Background
Approximately $2 trillion is currently invested in MISs, with 3,587 schemes registered with the Australian Securities and Investments Commission (ASIC) as at 30 June 2025.
Policy problem
The collapses of MISs causes significant financial and non-financial harm to investors and recent events have highlighted the need for reform.
The consultation paper considers several reform options to enhance the governance and oversight of registered MISs.
Summary of proposals
Proposal 1: Enhance the regulatory framework for compliance: Treasury proposes to: (a) introduce stricter compliance requirements, such as requiring a detailed description of the nature of the scheme and its investment strategy, and information outlining how significant risks will be identified, monitored and managed; (b) amend the liability framework for compliance plans, such that liability attaches only to material contraventions of a plan, to incentivise higher quality plans; (c) make existing audit and assurance standards mandatory for compliance plan auditors; and (d) require responsible entities to notify ASIC of appointment, removal or resignation of compliance committee members. Currently, liability attaches to any contravention of a compliance plan, which ASIC considers encourages generic plans with low standards. Limiting liability to material contraventions is intended to incentivise higher quality, more detailed plans.
Proposal 2: Require a majority of external directors on the boards of responsible entities: Responsible entities would be required to have a majority of external directors on their boards, removing the option of establishing a mandatory compliance committee as an alternative. This aligns with the existing requirement for retail corporate collective investment vehicles.
Proposal 3: Prohibit responsible entities of registered MISs from conducting related party transactions, with limited exceptions: Responsible entities would be prohibited from conducting related party transactions, with limited exceptions for legitimate business structures.
Proposal 4: Amend the framework for setting financial requirements for responsible entities: Treasury is seeking feedback on whether more specific financial resource requirements should be imposed on responsible entities and whether these should be set in primary legislation rather than being set by ASIC.
Proposal 5: Increase ASIC’s data collection powers on the retail MIS sector: New recurrent data collection powers would enhance ASIC’s ability to identify misconduct and scheme risk factors in the retail MIS sector. This proposal would enable ASIC to collect recurrent data on trends and flows, which, combined with event-based reporting, would improve ASIC’s ability to detect misconduct or other scheme risk factors.
Proposal 6: Alerts to ASIC about superannuation switching: Place an obligation on superannuation trustees to report to ASIC suspicious or anomalous patterns of behaviour, which the trustee reasonably considers could place their membership at risk of significant detriment.
Next Steps
The deadline for comments on the consultation is 27 February 2026.
Stakeholders may submit responses via Treasury’s website.