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Investor Presentaiton

ROYAL COMMISSION SIXTEEN ACTIONS - UPDATE ON 20 FEBRUARY COMMITMENTS Commitment Update on 20 February commitments Remuneration 5. 6. Redesign how we manage and reward our people to better focus on the interests of our customers, the long-term health of the bank and team, rather than individual, outcomes Continue to implement the recommendations of Mr Stephen Sedgwick, including by responding to any observations on how we can improve Accountability, culture and governance 7. Strengthen our accountability and consequence framework so that when things go wrong, we fix them and consistently hold executives to account . • 8. Supplement existing culture audits and ensure we act on identified problems • 9. Allocate specific responsibility to our BEAR¹ executive(s) for our products and complaints about them 10. Make our BEAR¹ executives explicitly responsible for preventing conduct that harms customers 11. Require our BEAR¹ executives to be open, constructive and cooperative with the Australian Securities and Investments Commission 1. Banking Executive Accountability Regime ANZ is working to launch a new approach to reward, remuneration and performance management. This is scheduled to launch in the last quarter of 2019. ANZ's delivery of Stephen Sedgwick's Retail Banking Remuneration Review recommendations is 75% complete. With the exclusion of Broker remuneration which is being managed at the industry level we are on track to deliver all recommendations by the end of 2019, ahead of October 2020 deadline. • • • • We have strengthened the principles and guidance that underpin our Accountability Framework, including the development of: Consequence Management Principles that guide a more consistent approach to consequence management across the bank, including impacts on remuneration. • Accountability Principles that define the various categories of accountability (e.g. direct, indirect, collective). Accountability Review Guidance to guide staff on when and how to undertake accountability reviews. We have commenced implementation and remain on track to complete by end of 2019. Actions addressing problems identified in the cultural reviews by Internal Audit are formally documented and tracked to completion. An Enterprise Culture Steering Group has been established, membership including the CEO, GM Talent & Culture and CRO. Meeting twice yearly ExCo members are required to present the current cultural strengths and concerns of their business, as well as actions taken and planned which are aimed at shifting the culture towards ANZ's desired culture. A new feedback tool has been launched, aimed at enabling greater self-awareness for leaders. The tool helps track outcomes of development and also provides an additional voice for our employees that can then be acted upon. We have recently reviewed our approach to culture measurement and we are now in the process of testing a new framework. The new approach has been designed to measure progress towards (or away from) our desired culture across our 6 different culture pillars, utilising a range of indicators some of which are consistent across businesses and others which are locally defined. • ANZ's BEAR responsibilities have been documented and assigned to each relevant executive. • APRA is currently finalising its BEAR product rules, expected by the end of 2019 calendar year. These rules will be utilised to finalise ANZ's product based BEAR responsibilities. ANZ 37
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