It was good to hear from pension fund consultant Andrew Whiley in Crikey on Tuesday, colourfully explaining the reasons why Australian industry funds absolutely do not need to have any independent directors.

However, in responding to this Crikey piece on Monday supporting Assistant Treasurer Josh Frydenberg’s proposed reforms, it would have been nice to have Whiley’s PR position disclosed along with the membership and consulting fees that flow from Australia’s $430 billion worth of industry funds to his London-based group, Pensions and Investment Research Consultants (PIRC).

Rather than having the unions, associated industry fund directors and the large ecosystem they support run the campaign against the modest governance reforms proposed by the Assistant Treasurer, why doesn’t anyone ask the members themselves?

After the success of City of Melbourne’s People’s Panel to advise on the council’s first 10-year financial plan, I’m a big fan of citizen juries for the way they strip away the vested interests, squeaky wheels and partisan players to allow an affected community to do a deep a dive on an issue and come up with some truly independent recommendations.

If presented with all the facts and evidence, I’d be very surprised if industry fund members did not agree with the proposition that a minority of independent directors along with an independent chairman is a good thing.

This simple and modest governance reform would reduce the prospect of scandals such as the recent CBUS privacy breaches and also lead to better disclosure of related party transactions and less nepotism in the industry.

Rather than orchestrating a predictable partisan campaign against these reforms, perhaps it is time for the godfather of Australia’s industry funds, union warrior Garry Weaven, to retire. Weaven, 67, has created a lot of value over the years, but it is now almost 40 years since he first joined the board of Victoria’s Local Authorities Superannuation Board in 1977.

The LASB is a good example of why governance reforms are needed. It is now part of Vision Super, which is effectively controlled by the Australian Services Union and the Municipal Association of Victoria. The MAV was recently given a severe towelling over governance shortfalls by Victoria’s Auditor General, but is yet to respond decisively with any meaningful personnel changes.

Similarly, because of the ASU influence at Vision Super, the fund failed to warn Victorian councils about the impact of ongoing above-CPI wage settlements secured by the ASU.

This led to a shock cash call of almost $500 million three years ago to cover the unfunded liability of some of those generous life-time pension deals that were closed off by the Kennett government in 1993.

An independent chair of Vision Super might have been out and about to councils explaining the compounding impact of big wage rises on defined benefit liabilities.

There are is only one independent director out of nine on the board of Vision Super, which doesn’t have any skill-based requirements for board members in its constitution and still hasn’t even screened out tobacco investments, unlike its far more progressive counterparts running local government super in NSW.

Does Whiley really think adding two more independent directors and removing an ASU veteran as chair is such a bad thing? Unless this legislation is passed, Vision Super could be chaired for many more years by Brian Parkinson, a greyhound trainer and owner by profession, who finally retired from the ASU as Victorian and Tasmanian branch secretary in July last year after 42 years of involvement.

In light of the Whiley intervention on behalf of PIRC, it will also be interesting to see how powerful Melbourne-based proxy adviser Ownership Matters plays the debate.

The two main drivers at Ownership Matters — Dean Paatsch and Martin Lawrence — have done more than anyone else in Australia to improve public company governance through their voting recommendations to institutional clients over the past 15 years.

They routinely recommend against non-independent directors and were pivotal in getting Cabcharge director Rodney Gilmour to resign from the board at last year’s AGM because he was a mate of chairman Russell Balding and a former PR consultant to the company.

However, the industry funds, through their umbrella organisation the Australian Council of Superannuation Investors, are also a vital paying clients of Ownership Matters. If ACSI campaigns against the reforms, it will be hard for Ownership Matters to publicly go the other way.

At least they haven’t yet come out swinging like a dunny door in the style of Andrew Whiley, who seems to think a majority of independent directors is a good thing at public companies, but not for the people who pay for his services.

*Stephen Mayne is chair of the Finance and Governance committee at City of Melbourne and was not paid for this item.