The Australian Prudential Regulation Authority (APRA) imposed additional license conditions effective Thursday on Fiducian Portfolio Services, a trustee of the Fiducian Superannuation Fund, to address concerns regarding its investment governance frameworks and practices, according to a Wednesday statement from the regulator.

APRA's review of investment governance, strategic planning, and member outcomes practices found a lack of consistent and well-defined investment selection criteria, and adequacy of due diligence undertaken for new investment options, as well as concerns regarding the design and effectiveness of investment option monitoring and reporting frameworks for performance and risk.

It also identified concerns regarding management of potential conflicts of interest and deficiencies in board governance.

Effective Thursday, Fiducian is required to appoint an independent expert to conduct separate reviews of certain of its high-risk products as well as its investment governance and conflicts management frameworks, APRA said. It is also required to appoint an independent expert to conduct a review of the effectiveness of its board and board committees.

The company must develop and implement uplift plans to address identified gaps from the independent expert reviews, and conduct a further review of its investment menu against the enhanced onboarding and monitoring requirements to determine ongoing suitability of each investment option, per the regulator.

It must also refrain from onboarding certain new high-risk investment options to its platform until an independent expert confirms the option has gone through an adequate onboarding process and an accountable person attests that all reasonable steps were taken to ensure the option is in members' best financial interests.

In a statement Wednesday, Fiducian acknowledged the receipt of APRA's additional license conditions. It established frameworks for investment governance, investment options, and board operations, and will appoint independent experts as required, to review and recommend any improvement opportunities which Fiducian will implement, it added.

Fiducian Group's (ASX:FID) shares fell nearly 2% in recent trading on Wednesday.