{"id":303,"date":"2019-03-31T13:00:00","date_gmt":"2019-03-31T13:00:00","guid":{"rendered":"https:\/\/insight.thomsonreuters.com\/mena\/legal\/resources\/resource\/corporate-governance-lessons-banking-royal-commission"},"modified":"2020-06-05T05:16:28","modified_gmt":"2020-06-05T05:16:28","slug":"corporate-governance-lessons-banking-royal-commission","status":"publish","type":"insight_resource","link":"https:\/\/insight.thomsonreuters.com\/mena\/legal\/resources\/resource\/corporate-governance-lessons-banking-royal-commission","title":{"rendered":"Corporate Governance Lessons from the Banking Royal Commission [Webinar]"},"content":{"rendered":"

The Banking Royal Commission Final Report may have been released months ago, but its impact, even on industries outside the financial services space, continues. In an increased regulatory environment, corporations are now looking to reassess their internal corporate governance processes.<\/span><\/p>\n

Commissioner Kenneth Hayne made no less than 76 recommendations and 24 referrals to the Australian Securities and Investments Commission and Australian Prudential Regulatory Authority. Since that time, the report has gained full, bipartisan support and still generates discussion around what this means for the financial and insurance sector and how corporates should behave.<\/span><\/p>\n

If your business is listed on the Australian Securities Exchange (ASX), the pressure on you to comply with regulations is arguably higher than ever. As a direct response to the widespread misconduct uncovered in the Banking Royal Commission, last month, the ASX\u2019s Corporate Governance Council released its fourth edition of Corporate Governance Principles and Recommendations. <\/span><\/p>\n

Here in Australia, the increasing regulatory environment may prove to be a challenging time for corporations. With this in mind, how should companies improve their corporate governance performance, in order to avoid public scrutiny, corporate watchdog fines or even a <\/span>dawn raid<\/span><\/a>?<\/span><\/p>\n

The <\/span>Thomson Reuters Risk Team<\/span><\/i> produced a webinar with three compliance experts, which you can access from this page. Below is a snippet of their conversation. <\/span><\/p>\n

Corporate culture is key <\/span><\/h2>\n

Regulatory Intelligence Expert at <\/span>Thomson Reuters<\/span><\/i>, Niall Coburn, noted that the Banking Royal Commission heavily criticised \u201cculture deficits\u201d among financial institutions, which corporations should want to avoid.<\/span><\/p>\n

\u201cEverything in your organisation and your culture must be geared to providing skillful and adequate services which are free from conflict of interest and that you look after your client,\u201d said Coburn. <\/span><\/p>\n

\u201cYou must improve the culture of the organisation, as culture has the ultimate effect on the conduct of all staff…from the top all the way through the organisation.\u201d <\/span><\/p>\n

Communication with The Board is critical <\/span><\/h2>\n

Coburn also referred to some instances highlighted in Hayne\u2019s Report where executives mislead their boards, indicating the lack of communication between different levels of corporate hierarchy. <\/span><\/p>\n

\u201cIt was clear that some of the boards in these financial institutions weren\u2019t being fed really good or exact information of what was happening in the trenches. So they weren\u2019t really receiving the extent of the misconduct, or it was watered down so they didn\u2019t really understand the full impact,\u201d he said. <\/span><\/p>\n

To stop this from happening, Coburn’s advice to businesses is simple: \u201cKeep the lines of communication open.\u201d<\/span><\/p>\n

Corporate governance is shared<\/span><\/h2>\n

Another expert featured in this webinar is Helen Bird, a Corporate Governance Scholar at <\/span>Swinburne Law School<\/span><\/i> who researches and writes on regulatory trends. Bird said that when it comes to corporate governance, the Banking Royal Commission has reminded us that individuals aren\u2019t excluded from corporate accountability.  <\/span><\/p>\n

\u201c[Hayne reminds us] that governance isn\u2019t just for The Board, it\u2019s for the whole organisation and everyone has a role in it. The buck for responsibility regarding governance stops with The Board, but everyone else has a job to contribute towards better governance overall,\u201d said Bird. <\/span><\/p>\n

Customers are stakeholders too <\/span><\/h2>\n

In the corporate world, company directors have traditionally been obliged to <\/span>act in the best interests of their shareholders. However, Lesley <\/span>Symons, Special Counsel at <\/span>GRT Lawyers<\/span><\/i> believes the Banking Royal Commission has shifted the focus. <\/span><\/p>\n

\u201cOne of the key themes that has we\u2019ve seen come out of the Commission is that the definition of key stakeholders has very much expanded now in my view and Hayne places customers squarely in the centre of that group,\u201d said Symons. <\/span><\/p>\n

\u201c[Hayne is] essentially saying to the entire sector: \u201cYou need to place these customers at the centre…and act in their best interests. By acting in their best interests, you will then be complying.\u201d\u201d<\/span><\/p>\n

With compliance now a big issue among Australian corporates, let\u2019s hope their legal teams are well-equipped to deal with the challenges 2019 has in store for them. <\/span><\/p>\n

What else does the Banking Royal Commission Report have in store for Australian businesses? Access the full conversation between all three compliance experts by simply filling out the form on this page.<\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

The Banking Royal Commission Final Report may have been released months ago, but its impact, even on industries outside the financial services space, continues. In an increased regulatory environment, corporations…<\/p>\n","protected":false},"author":2,"featured_media":304,"template":"","categories":[2,3,9,617],"tags":[43,45,155,463],"resource_type":[637],"insight_job_role":[598,627],"insight_practice_area":[571,579,582,583],"class_list":["entry","author-legaladmin","post-303","insight_resource","type-insight_resource","status-publish","has-post-thumbnail","category-business-development","category-business-efficiency","category-law-firm-marketing","category-practice-management","tag-apra","tag-asic","tag-corporations","tag-royal-commission","resource_type-webinar","insight_job_role-in-house-lawyer","insight_job_role-senior-executive","insight_practice_area-banking-and-finance-law","insight_practice_area-commercial-law","insight_practice_area-company-law","insight_practice_area-competition-law","hentry"],"acf":[],"yoast_head":"\nCorporate Governance Lessons From the Banking Royal Commission<\/title>\n<meta name=\"description\" content=\"The Banking Royal Commission Final Report may have been released months ago, but its impact, even on industries outside the financial services space, continues. 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