SYDNEY (Reuters) - Australia’s banking regulator said on Wednesday it will ask financial institutions for annual declarations on governance and corporate culture, and will conduct “deep dive” reviews if concerns arise.
The move is part of the watchdog’s four-year plan to improve governance standards in the financial system and build trust after a government-mandated inquiry last year uncovered widespread misconduct in the sector.
The declarations, which will also encompass remuneration and accountability, will involve periodic self-assessments.
“We are not aware of any peer regulator who has such an aspirational and wide-ranging plan,” Wayne Byres, chairman of the Australian Prudential Regulation Authority, told a forum in Sydney.
Insights from the reviews would be made public and it plans to name companies with the best and worst records.
“The intensity of our oversight, and our preparedness to compel rectification action is certainly increasing,” Byres said, adding that the exact specifications of the declarations and reviews would be decided in consultations with the industry.
The regulator also plans separate reviews that will look at the role and effectiveness of board committees, the processes used to assess board effectiveness and the alignment of remuneration with risk.
Reporting by Paulina Duran in Sydney; Editing by Edwina Gibbs