Following the upcoming Cooper review on super, the investment management fees may be on the chopping block; however one fund manager warns that reviewing fees is not enough and in order to understand the incentives behind high fees, equal attention should be paid.

Jeremy Cooper, chair of the review and deputy chairman of ASIC, said that whether it is an asset or percentage based arrangement, there is a "structural problem" with the way investment management fees are charged.

He told yesterday at the lunch of the Association of Superannuation Funds of Australia that the review will look carefully at the structures of these fees, whether they can be reduced and gauge people's understanding of them.

Cooper added, “For example the problem is that investment management fees increase rather than decrease with the size of funds under management.”

However chief investment officer of Select Funds Management, Dominic McCormick warns that it's not enough to merely look at fee structures and how overall fees can be reduced.

He told that finding out the incentives behind the fees is the key to understanding the dilemma.

“It's important to get the incentives and disclosure right before focusing on each individual level of fees.”

McCormick said that promoting simplicity and better disclosure will go a long way to resolving and clarifying the issue.