Last year’s conduct and culture review (run jointly with the FMA) highlighted specific shortcomings in governance and risk management at banks and insurers, notably in relation to sales incentives. The court judgement on CBLI’s liquidation stated that “aspects of CBLI’s management had indicated a lack of commercial probity”. And “a lack of candour in dealing with the company’s auditors and the regulator”.
More recently we revoked ANZ’s accreditation to model its own operational risk capital requirement because of persistent failures in its controls and attestation process. It is clear that institutional self-discipline has been lacking.