ANZ CEO Shayne Elliott will today be grilled by federal politicians about revelations of...

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1 FRI 12 OCTOBER 2018 Mediaportal Report ANZ CEO Shayne Elliott will today be grilled by federal politicians about revelations of... 2SM, Sydney, 08:30 News, Newsreader 12 Oct :30 AM Duration: 0 min 26 secs ASR AUD 994 NSW Australia Industry Super Australia - Radio & TV ID: X ANZ CEO Shayne Elliott will today be grilled by federal politicians about revelations of financial misconduct exposed at the Royal Commission, following yesterday's inquiry involving CBA and Westpac. 12,000 All, 7,000 MALE 16+, 5,000 FEMALE 16+ Also broadcast from the following 10 stations 2AD (Armidale), 2DU (Dubbo), 2EL (Orange), 2GF (Grafton), 2HD (Newcastle), 2MG (Mudgee), 2MO (Gunnedah), 2NZ (Inverell), 2PK (Parkes), 2VM (Moree) ANZ CEO Shayne Elliott will be grilled by federal politicians about allegations of financial... 2SM, Sydney, 07:30 News, Newsreader 12 Oct :32 AM Duration: 0 min 24 secs ASR AUD 918 NSW Australia Industry Super Australia - Radio & TV ID: X ANZ CEO Shayne Elliott will be grilled by federal politicians about allegations of financial misconduct exposed in the Banking Royal Commission. N/A All, N/A MALE 16+, N/A FEMALE 16+ Also broadcast from the following 10 stations 2AD (Armidale), 2DU (Dubbo), 2EL (Orange), 2GF (Grafton), 2MG (Mudgee), 2MO (Gunnedah), 2NZ (Inverell), 2PK (Parkes), 2RE (Taree), 2VM (Moree) ANZ boss Shayne Elliott will be next to face questions from federal MPs in Canberra due... 2GB, Sydney, 07:00 News, Newsreader 12 Oct :02 AM Duration: 0 min 21 secs ASR AUD 1,195 NSW Australia Industry Super Australia - Radio & TV ID: X ANZ boss Shayne Elliott will be next to face questions from federal MPs in Canberra due to financial misconduct exposed by the royal commission. The bosses of the Commonwealth and Westpac banks yesterday admitted they failed many customers and are working to improve their practices. 176,000 All, 79,000 MALE 16+, 97,000 FEMALE 16+ Also broadcast from the following 13 stations 2BS (Bathurst), 2EC (Bega), 2GN (Goulburn), 2LT (Lithgow), 2MAX (Narrabri), 2NUR (Newcastle), 2QN (Deniliquin), 2XL (Cooma), 2YOU FM (Tamworth), Coast FM (Gosford), Great Lakes FM (Taree), Macquarie Sports Radio (Sydney), Magic 2CH (Sydney) COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

2 ANZ CEO Shayne Elliott will today be grilled by federal politicians about revelations of... 2SM, Sydney, 06:30 News, Newsreader 12 Oct :31 AM Duration: 0 min 26 secs ASR AUD 1,136 NSW Australia Industry Super Australia - Radio & TV ID: X ANZ CEO Shayne Elliott will today be grilled by federal politicians about revelations of financial misconduct exposed at the Royal Commission, following yesterday's inquiry involving CBA and Westpac. 8,000 All, 3,000 MALE 16+, 5,000 FEMALE 16+ Also broadcast from the following 13 stations 2AD (Armidale), 2DU (Dubbo), 2EL (Orange), 2GF (Grafton), 2HD (Newcastle), 2LM (Lismore), 2MG (Mudgee), 2MO (Gunnedah), 2NZ (Inverell), 2PK (Parkes), 2RE (Taree), 2TM (Tamworth), 2VM (Moree) Caller Warren mentions there are two royal commissions ongoing, which involves... 2SM, Sydney, Breakfast, Dave Sutherland 12 Oct :05 AM Duration: 6 mins 49 secs ASR AUD 5,069 NSW Australia Industry Super Australia - Radio & TV ID: X Caller Warren mentions there are two royal commissions ongoing, which involves banking and the nursing homes. He says they hope the banks will reform their ways, become honest, and develop Christian and business ethics. Warren says he's going to comment on the commission on nursing homes. He says he and his wife got a suspicion her late mother-in-law was being abused by a nurse when she was in the nursing home. Sutherland suggests setting up a camera because it's the best way to prove beyond doubt. Warren says they were informed that this nurse, who wasn't qualified, had done cruelty. He says the nurse has eventually moved to a nursing home in Qld. He says if he's checked with the Nurses Association, he'll probably find out where she is. Warren states 98% of nurses in Australia are wonderful. He says he's going to put in a report for the royal commission about the matter. N/A All, N/A MALE 16+, N/A FEMALE 16+ Also broadcast from the following 2 stations 2EL (Orange), 2HC (Coffs Harbour) ANZ boss Shayne Elliott will be next to face questions from federal MPs in Canberra due... 4BC, Brisbane, 06:00 News, Newsreader 12 Oct :01 AM Duration: 0 min 20 secs ASR AUD 956 QLD Australia Industry Super Australia - Radio & TV ID: X ANZ boss Shayne Elliott will be next to face questions from federal MPs in Canberra due to financial misconduct exposed by the royal commission. The bosses of the Commonwealth and Westpac banks yesterday admitted they failed many customers and are working to improve their practices. 23,000 All, 14,000 MALE 16+, 9,000 FEMALE 16+ Also broadcast from the following 7 stations 1071 AM (Kingaroy), 4BU (Bundaberg), 4CRB FM (Gold Coast), 4LG (Longreach), Hitz FM (Bundaberg), Radio 4KZ (Innisfail), Zinc 666 (Mt Isa) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

3 The ANZ Bank boss will be asked to come clean about whether he has met with any... 2GB, Sydney, 06:00 News, Newsreader 12 Oct :01 AM Duration: 0 min 38 secs ASR AUD 1,659 NSW Australia Industry Super Australia - Radio & TV ID: X The ANZ Bank boss will be asked to come clean about whether he has met with any victims of the bank's misconduct. Shayne Elliott will face a parliamentary committee to answer questions about the wrong-doing exposed by the Royal Commission. Matt Thistlethwaite, Committee Deputy Chairman, says all four bank bosses are being pushed on one point in particular. 101,000 All, 52,000 MALE 16+, 49,000 FEMALE 16+ Interviewees Matt Thistlethwaite, Committee Deputy Chairman Also broadcast from the following 13 stations 2BS (Bathurst), 2EC (Bega), 2GN (Goulburn), 2LT (Lithgow), 2MAX (Narrabri), 2NUR (Newcastle), 2QN (Deniliquin), 2XL (Cooma), 2YOU FM (Tamworth), Coast FM (Gosford), Great Lakes FM (Taree), Macquarie Sports Radio (Sydney), Magic 2CH (Sydney) ANZ boss Shayne Elliott will be asked to come clean about whether he has met with any... 3AW, Melbourne, 05:30 News, Newsreader 12 Oct :32 AM Duration: 0 min 35 secs ASR AUD 616 VIC Australia Industry Super Australia - Radio & TV ID: X ANZ boss Shayne Elliott will be asked to come clean about whether he has met with any victims of the bank's misconduct. He has faced a Parliamentary Committee to answer questions about wrongdoing exposed by the Royal Commission. Committee Deputy Chair Matt Thistlethwaite says all four bank bosses have been pushed on one point in particular. 93,000 All, 48,000 MALE 16+, 45,000 FEMALE 16+ Interviewees Matt Thistlethwaite, Parliamentary Committee Deputy Chair Also broadcast from the following 1 station SEN (Melbourne) ANZ Bank CEO Shayne Elliott will be asked to come clean about whether he has met... 4BC, Brisbane, 05:30 News, Newsreader 12 Oct :31 AM Duration: 0 min 39 secs ASR AUD 569 QLD Australia Industry Super Australia - Radio & TV ID: X ANZ Bank CEO Shayne Elliott will be asked to come clean about whether he has met with any victims of the bank's misconduct. Elliott will face a Parliamentary Committee to answer questions about the wrong-doing exposed by the Royal Commission. Committee Deputy Chairman and Labor MP Matt Thistlethwaite says all four bank bosses are being pushed on one point in particular. 23,000 All, 14,000 MALE 16+, 9,000 FEMALE 16+ Interviewees Matt Thistlethwaite, Committee Deputy Chairman Also broadcast from the following 1 station Radio 4KZ (Innisfail) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

4 Greed wasn't good, CBA boss concedes Herald Sun, Melbourne, Business News, Jeff Whalley 12 Oct 2018 Page words ASR AUD 12,438 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: COMMONWEALTH Bank chief Matt Comyn says the bank should have better protected customers instead of protecting commissions for financial advisers. And greed "in some cases" contributed to the problems that have beset the bank, Mr Comyn says. View original - Full text: 455 word(s), ~1 min 303,140 CIRCULATION $17.5b in super lost Herald Sun, Melbourne, General News 12 Oct 2018 Page words ASR AUD 11,938 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: Chase missing savings, taxman says SOPHIE ELSWORTH A POT of $17.5 billion in superannuation is unclaimed - and the largest unclaimed account has a balance of $2.2 million. New figures from the financial year released by the Australian Taxation Office showed 6.2 million superannuation accounts, with an average balance of $2933, lay unclaimed by their owners. View original - Full text: 352 word(s), ~1 min 303,140 CIRCULATION Adding up the loose change Daily Telegraph, Sydney, General News 12 Oct 2018 Page words ASR AUD 12,333 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: Bank bosses try to repair the damage GREEDY, complacent and too slow to fix problems - the bosses of the Commonwealth and Westpac banks yesterday admitted their institutions had a lot of changes to make up for the immense damage done to their customers. But at a parliamentary hearing in Canberra yesterday, Commonwealth Bank (CBA) chief executive Matt Comyn (pictured) and Westpac chief executive Brian Hartzer also said they had begun the epic task of rebuilding trust. View original - Full text: 391 word(s), ~1 min 232,067 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

5 Loss of corporate trust 'partly self-inflicted' The Australian, Australia, Business News, Perry Williams 12 Oct 2018 Page words ASR AUD 12,555 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: One of the nation's most influential company directors, Lindsay Maxsted, concedes that some of the loss of trust between the public and corporate Australia is selfinflicted and says boards must do more to explain the contribution of big business to communities and the economy. The Transurban chairman, who announced plans yesterday to step down in the next few years, is one of the country's most wellconnected board figures as a director of global miner BHP and chairman of Westpac, which is under intense scrutiny as part of the banking royal commission. View original - Full text: 641 word(s), ~2 mins 94,448 CIRCULATION How to bring the big four to book? The Australian, Australia, Business News, John Durie 12 Oct 2018 Page words ASR AUD 17,237 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: What's the best way to bring the banks into line? In the eyes of Productivity Commission deputy Karen Chester, "policy architecture needs to do the heavy lifting". View original - Full text: 890 word(s), ~3 mins 94,448 CIRCULATION Chief faces the wrath of customers The Australian, Australia, Business News, Rosie Lewis Ben Butler 12 Oct 2018 Page words ASR AUD 15,024 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: CBA boss Matt Comyn had planned to meet just one angry customer yesterday - Selwyn Krepp, who ran an accommodation business in Cairns that the bank foreclosed on in But after being surrounded by people keen to tell him exactly how badly they had been treated by the bank during a break in testimony to the House of Representatives yesterday morning, he ended up talking to half a dozen. The morning tea break came after two hours of testimony from Mr Comyn during which he repeatedly apologised for the scandal-ridden bank's misconduct and wrongdoing over the years as onlookers in the public gallery jeered and heckled. View original - Full text: 651 word(s), ~2 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

6 No accounting for waste in $2m super blooper Daily Telegraph, Sydney, General News, Sophie Elsworth 12 Oct 2018 Page words ASR AUD 4,300 Photo: No Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: SOMEWHERE out there is an absent-minded Sydneysider who has inexplicably forgotten they possess one super-sized superannuation account. Among the list of lost and unclaimed super identified by the Australian Taxation Office in is a single account containing $2.2 million. View original - Full text: 196 word(s), <1 min 232,067 CIRCULATION Customer comes first, says milk boss The Australian, Australia, General News, Damon Kitney 12 Oct 2018 Page words ASR AUD 4,785 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: STANDARDS Leading chief executives and company directors have urged corporate Australia to focus less on making profits and more on satisfying and providing results for customers and clients in the wake of the damning findings of the banking royal commission. View original - Full text: 581 word(s), ~2 mins 94,448 CIRCULATION Future investment is business's big challenge The Australian, Australia, General News, Damon Kitney 12 Oct 2018 Page words ASR AUD 5,300 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Wesfarmers and AGL Energy director Diane Smith-Gander made a powerful point yesterday when she said the royal commission into our biggest industry, the financial services sector, had come at precisely the wrong time. Of course no one can excuse the outrageous, immoral behaviour that has been highlighted by the months of hearings, culminating in appearances before the commission yesterday of the chief executives of two of the big four banks. View original - Full text: 592 word(s), ~2 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

7 Bowen raises concerns for super top-10 list The Australian, Australia, General News, Michael Roddan 12 Oct 2018 Page words ASR AUD 3,525 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: SUPERANNUATION Opposition Treasury spokesman Chris Bowen has laid out concerns about the Productivity Commission's recommendation to shakeup the $2.7 trillion superannuation sector in the interests of savers. View original - Full text: 353 word(s), ~1 min 94,448 CIRCULATION Comyn, Hartzer apologise for banks' failures The Australian, Australia, Business News, Ben Butler 12 Oct 2018 Page words ASR AUD 16,774 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: The boss of Australia's biggest bank was yesterday forced to tear up his diary and spend his afternoon listening to angry customers who confronted him during a parliamentary hearing in Canberra. Commonwealth Bank chief executive Matt Comyn and his counterpart at Westpac, Brian Hartzer, yesterday gave evidence to the House of Representatives economics committee's standing inquiry into the behaviour of the big four banks - their first appearances before parliament since financial services royal commissioner Kenneth Hayne slammed the sector for greeddriven wrongdoing in his interim report tabled a fortnight ago. View original - Full text: 842 word(s), ~3 mins 94,448 CIRCULATION Suncorp's Birdcage withdrawal The Australian, Australia, Business News, Will Glasgow Christine Lacy 12 Oct 2018 Page words ASR AUD 13,584 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Kenneth Hayne's royal commission has set off a crisis right at the top of Michael Cameron's financial giant Suncorp. For as long as anyone can remember, the $17.8 billion Queensland-based Suncorp has had a blue-chip marquee in Flemington's Birdcage for the Spring Racing Carnival. View original - Full text: 474 word(s), ~1 min 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

8 In for the long haul: Byres's call to lift industry standards of behaviour begins with regulator The Australian, Australia, Business News, Richard Gluyas 12 Oct 2018 Page words ASR AUD 7,564 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: APRA boss Wayne Byres's clarion call in response to the disgraceful behaviour highlighted in the financial services royal commission is to lift the standard of behaviour by all industry participants, including regulators. It's hard to disagree, but there's a long way to go. In a footnote to Byres's speech, he pointed to an extraordinary anomaly in the industry's regulatory structure. View original - Full text: 763 word(s), ~3 mins 94,448 CIRCULATION SAVINGS REVOLUTION DAWNS The Australian, Australia, Business News, Robert Gottliebsen 12 Oct 2018 Page words ASR AUD 9,442 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: An avalanche of money is flowing to the industry funds As the fall in global sharemarkets gathers momentum, Australia is starting to experience what looks like being one of the largest savings revolutions in our history. View original - Full text: 908 word(s), ~3 mins 94,448 CIRCULATION Sector must put clients first, says ASIC head The Australian, Australia, Business News, Scott Murdoch Samantha Bailey 12 Oct 2018 Page words ASR AUD 10,291 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: FINANCIAL SERVICES ROYAL COMMISSION Australian Securities & Investment Commission chairman James Shipton has said the financial services industry needs to be made "noble" and lose the focus on greed to regain the trust of the community after the royal commission. View original - Full text: 630 word(s), ~2 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

9 LONG ROAD BACK TO TRUST SAY BANK BOSSES Adelaide Advertiser, Adelaide, Business News 12 Oct 2018 Page words ASR AUD 5,682 Photo: Yes Type: News Item Size: cm² SA Australia Industry Super Australia - Press ID: THE heads of two of Australia's biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public's trust. The sentiments emerged while the bosses were being grilled by federal politicians at a parliamentary hearing in Canberra. View original - Full text: 401 word(s), ~1 min 112,097 CIRCULATION ONLINE What you are saying about... Adelaide Advertiser, Adelaide, Letters 12 Oct 2018 Page words ASR AUD 2,514 Photo: No Type: Letter Size: cm² SA Australia Industry Super Australia - Press ID: PM Scott Morrison wants to fast-track tax cuts for SA What is the Government doing to fix the recent disastrous ruling that effectively destroys casual employment as an option? This is an urgent matter that will have a huge and negative impact on small business flexibility, profitability and capacity to employ. ANGELA What he should be doing is taxing all of these companies that have taken themself offshore, as was promised by the former PM at the last federal election. View original - Full text: 329 word(s), ~1 min 112,097 CIRCULATION $1.7m SA super gift unclaimed Adelaide Advertiser, Adelaide, General News, Sophie Elsworth 12 Oct 2018 Page words ASR AUD 2,276 Photo: No Type: News Item Size: cm² SA Australia Industry Super Australia - Press ID: AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And one South Australian has $1.7 million in superannuation just waiting in an Adelaide account. View original - Full text: 266 word(s), ~1 min 112,097 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

10 BANKS TAKE HIT IN STORM Courier Mail, Brisbane, Business News, Sophie Moore 12 Oct 2018 Page words ASR AUD 16,720 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: BANK stocks were among the worst hit yesterday after a "perfect storm" on Wall Street caused a sea of red across global markets. The Big Four banks together lost more than $10 billion in value. View original - Full text: 483 word(s), ~1 min 135,007 CIRCULATION Super high $17 billion unclaimed Courier Mail, Brisbane, General News, Sophie Elsworth 12 Oct 2018 Page words ASR AUD 1,335 Photo: No Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And the largest amount yet to be claimed has a staggering balance of $2.2 million. View original - Full text: 181 word(s), <1 min 135,007 CIRCULATION Shorten to shake up bank super The Australian, Australia, General News, Benson Rosie Lewis 12 Oct 2018 Page words ASR AUD 15,590 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: HEAT ON LABOR OVER COMPANY TAX CUTS Bill Shorten has flagged giving financial regulators the power to force bank-owned retail superannuation funds to appoint independent trustees to ensure members' interests are put ahead of profits when dealing with workers' compulsory retirement savings. View original - Full text: 1127 word(s), ~4 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

11 Clouds gather over global economy Age, Melbourne, Editorials 12 Oct 2018 Page words ASR AUD 13,259 Photo: Yes Type: Editorial Size: cm² VIC Australia Industry Super Australia - Press ID: The stock market has provided a timely reminder that the strong global economy which has buoyed Australia in recent years cannot last forever. The Australian market fell 2.74 per cent yesterday after even sharper declines on Wall Street. That could, of course, be a temporary blip and unless they check their superannuation balance every day, most Australians would probably not even notice. Yet, lower share prices will eventually undermine consumer sentiment, adding to the weight from falling house prices. That is not the only worrying news. The International Monetary Fund downgraded its forecasts for global economic growth in this financial year to 3.7 per cent, down from 3.9 per cent. View original - Full text: 587 word(s), ~2 mins 83,229 CIRCULATION Global economic sunshine can't last forever Sydney Morning Herald, Sydney, Editorials 12 Oct 2018 Page words ASR AUD 18,772 Photo: Yes Type: Editorial Size: cm² NSW Australia Industry Super Australia - Press ID: The stock market has provided a timely reminder that the strong global economy which has buoyed Australia in recent years cannot last forever. The Australian market fell 2.74 per cent yesterday after even sharper sharp declines on Wall Street. That could, of course, be a temporary blip and unless they check their superannuation balance every day most Australians would probably not even notice. Yet, lower share prices will eventually undermine consumer sentiment adding to the weight from falling house prices. That is not the only worrying news. The International Monetary Fund, the world's official forecaster, downgraded its forecasts for global economic growth in this financial year to 3.7 per cent, down from 3.9 per cent. View original - Full text: 589 word(s), ~2 mins 88,634 CIRCULATION 'I should have taken it further' Age, Melbourne, General News, Clancy Yeates 12 Oct 2018 Page words ASR AUD 38,210 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: Commonwealth Bank chief executive Matt Comyn has admitted that he should have done more to investigate the illegitimate setting up of children's bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. During a wide-ranging grilling that also focused on banker bonuses and CBA's charging of dead people, new details came to light about a previous scam in which Youthsaver bank accounts were activated by staff to game incentive systems. View original - Full text: 638 word(s), ~2 mins 83,229 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

12 Comyn admits Dollarmites failure Sydney Morning Herald, Sydney, General News, Clancy Yeates 12 Oct 2018 Page words ASR AUD 29,250 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: BANKING Commonwealth Bank chief executive Matt Comyn has admitted he should have done more to investigate the illegitimate setting up of children's bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. View original - Full text: 637 word(s), ~2 mins 88,634 CIRCULATION Celebrity planner breached code Sydney Morning Herald, Sydney, Business News, Melanie Beeby 12 Oct 2018 Page words ASR AUD 2,983 Photo: No Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: The Financial Planning Association of Australia's (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson's over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. "FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards," FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn't been made. View original - Full text: 94 word(s), <1 min 88,634 CIRCULATION Westpac mulled passing levy onto customers, staff Sydney Morning Herald, Sydney, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 56,535 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. View original - Full text: 637 word(s), ~2 mins 88,634 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

13 An ominous sign as Wall Street's FANGs are bitten Sydney Morning Herald, Sydney, Business News, Stephen Bartholomeusz 12 Oct 2018 Page words ASR AUD 41,910 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: That shudder that roiled the US sharemarket may not be the end of the near decade-long bull market but it might well signal the beginning of the end. A 3.3 per cent fall in the market isn't a crash but it still represents an unusual and disconcerting event. Within that overall fall, the 4 per cent decline in the technologyheavy Nasdaq market was particularly ominous, given that it was the big technology stocks like Amazon, Facebook, Netflix and Google that had powered the market to record levels last month. View original - Full text: 924 word(s), ~3 mins 88,634 CIRCULATION Watchdog concedes it may need to crack down more Sydney Morning Herald, Sydney, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 16,371 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. View original - Full text: 471 word(s), ~1 min 88,634 CIRCULATION Dishonesty must stop, says ASIC's Shipton Sydney Morning Herald, Sydney, Business News 12 Oct 2018 Page words ASR AUD 7,931 Photo: No Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission's interim report into misconduct in the financial services industry and that is "dishonesty". "That word 'dishonest'... that is the diagnosis on our industry - it is a blight," he told a finance industry conference in Sydney yesterday. View original - Full text: 302 word(s), ~1 min 88,634 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

14 'We became complacent' Daily Mercury, Mackay QLD, General News 12 Oct 2018 Page words ASR AUD 263 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 7,738 CIRCULATION 'We became complacent' News Mail, Bundaberg QLD, General News 12 Oct 2018 Page words ASR AUD 229 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 6,176 CIRCULATION 'We became complacent' Queensland Times, Ipswich QLD, General News 12 Oct 2018 Page words ASR AUD 229 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 6,256 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

15 'We became complacent' Gympie Times, Gympie QLD, General News 12 Oct 2018 Page words ASR AUD 193 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 2,997 CIRCULATION Celebrity planner breached code Age, Melbourne, Business News, Melanie Beeby 12 Oct 2018 Page words ASR AUD 2,294 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: The Financial Planning Association of Australia's (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson's over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. "FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards," FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn't been made. View original - Full text: 94 word(s), <1 min 83,229 CIRCULATION Westpac mulled passing levy onto customers, staff Age, Melbourne, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 43,692 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. View original - Full text: 637 word(s), ~2 mins 83,229 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

16 Watchdog concedes it may need to crack down more Age, Melbourne, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 12,755 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. View original - Full text: 471 word(s), ~1 min 83,229 CIRCULATION Dishonesty must stop, says ASIC's Shipton Age, Melbourne, Business News, John Collett 12 Oct 2018 Page words ASR AUD 6,098 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission's interim report into misconduct in the financial services industry and that is "dishonesty". "That word 'dishonest'... that is the diagnosis on our industry - it is a blight," he told a finance industry conference in Sydney yesterday. View original - Full text: 300 word(s), ~1 min 83,229 CIRCULATION Before search engines we visited pubs Gladstone Observer, Gladstone QLD, General News, Greg Bray 12 Oct 2018 Page words ASR AUD 143 Photo: No Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: FOLKS, it wasn't so long ago that Gladstone's pubs were what us old people used before internet search engines. Before social media, if you were looking for a job, a tradie, pet, some dodgy retail goods, a shoulder to cry on, cheap seafood or true love, the first place you'd go was your favourite watering hole. View original - Full text: 379 word(s), ~1 min 3,301 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

17 'We became complacent' Gladstone Observer, Gladstone QLD, General News 12 Oct 2018 Page words ASR AUD 228 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 3,301 CIRCULATION Banks' long road Border Mail, Albury-Wodonga, General News 12 Oct 2018 Page words ASR AUD 1,284 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: THE heads of two of Australia's biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public's trust. View original - Full text: 281 word(s), ~1 min 13,519 CIRCULATION Banks' long road Warrnambool Standard, Warrnambool VIC, General News 12 Oct 2018 Page words ASR AUD 1,364 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: THE heads of two of Australia's biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public's trust. View original - Full text: 281 word(s), ~1 min 8,274 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

18 Westpac mulled passing levy onto customers, staff Canberra Times, Canberra, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 20,414 Photo: Yes Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. View original - Full text: 637 word(s), ~2 mins 17,579 CIRCULATION Celebrity planner breached code Canberra Times, Canberra, Business News, Melanie Beeby 12 Oct 2018 Page words ASR AUD 1,050 Photo: No Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: The Financial Planning Association of Australia's (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson's over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. "FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards," FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn't been made. View original - Full text: 94 word(s), <1 min 17,579 CIRCULATION Watchdog concedes it may need to crack down more Canberra Times, Canberra, Business News, Sarah Danckert 12 Oct 2018 Page words ASR AUD 5,865 Photo: Yes Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. View original - Full text: 471 word(s), ~1 min 17,579 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

19 Dishonesty must stop, says ASIC's Shipton Canberra Times, Canberra, Business News, John Collett 12 Oct 2018 Page words ASR AUD 2,817 Photo: No Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission's interim report into misconduct in the financial services industry and that is "dishonesty". "That word 'dishonest'... that is the diagnosis on our industry - it is a blight," he told a finance industry conference in Sydney yesterday. View original - Full text: 300 word(s), ~1 min 17,579 CIRCULATION CBA boss revealed Youthsaver scam to board Canberra Times, Canberra, General News, Clancy Yeates 12 Oct 2018 Page words ASR AUD 17,443 Photo: Yes Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: Commonwealth Bank chief executive Matt Comyn has admitted he should have done more to investigate the illegitimate setting up of children's bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. During a wide-ranging grilling that also focused on banker bonuses and CBA's charging of dead people, new details came to light about a previous scam in which Youthsaver bank accounts were activated by staff to game incentive systems. View original - Full text: 764 word(s), ~3 mins 17,579 CIRCULATION Kiwis fly into rage over Brisbane air display West Australian, Perth, General News 12 Oct 2018 Page words ASR AUD 7,802 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: ? Brisbane It seems the lack of military jets in New Zealand is too much for the Kiwis to bear when they encounter them across the ditch. A bunch of New Zealanders are up in arms after taking exception to the actions of highly qualified RAAF pilots as they performed their usual aerobatics in Brisbane as part of the city's annual Riverfire festival. A Boeing C-17 transport plane flew low over the crowd and close to buildings. View original - Full text: 227 word(s), <1 min 147,676 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

20 BIG BUX 'FRAUD' West Australian, Perth, General News, Tim Clarke And Gary Adshead 12 Oct 2018 Page words ASR AUD 12,500 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: Dudded investors count the cost Just $47,000 in cash remains among the paltry assets of the now defunct Bux mobile phone money transfer business, which had attracted $100 million in investments - but yesterday was declared bust. View original - Full text: 536 word(s), ~2 mins 147,676 CIRCULATION Bosses admit banks let their customers down West Australian, Perth, General News, Shane Wright 12 Oct 2018 Page words ASR AUD 7,802 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: The heads of the nation's two biggest banks have offered a mea culpa for the misbehaviour and "greed" of their institutions after warnings dodgy executives may face much tougher penalties in the future. Commonwealth Bank chief executive Matt Comyn and Westpac boss Brian Hartzer admitted to a parliamentary committee a series of failings that have been exposed by the "searing" interim report from the banking royal commission. View original - Full text: 396 word(s), ~1 min 147,676 CIRCULATION Tinley to take on tax pleas West Australian, Perth, Business News, Helen Shield 12 Oct 2018 Page words ASR AUD 2,244 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: Housing Minister Peter Tinley has pledged to ask Treasurer Ben Wyatt to consider the WA property industry's pleas to defer the foreign buyer surcharge. Urban Development Institute of Australia WA chief executive Allison Hailes yesterday told Mr Tinley the industry found it "incongruous" the surcharge could be introduced in the middle of a property downturn. View original - Full text: 273 word(s), ~1 min 147,676 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

21 'We became complacent' Sunshine Coast Daily, Maroochydore QLD, General News 12 Oct 2018 Page words ASR AUD 281 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 10,046 CIRCULATION 'We became complacent' Cairns Post, Cairns, General News 12 Oct 2018 Page words ASR AUD 1,229 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (right), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 13,896 CIRCULATION 'We became complacent' Gold Coast Bulletin, Gold Coast QLD, General News 12 Oct 2018 Page words ASR AUD 1,797 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 21,468 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

22 'We became complacent' Townsville Bulletin, Townsville QLD, General News 12 Oct 2018 Page words ASR AUD 1,487 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank's actions have caused. View original - Full text: 399 word(s), ~1 min 16,484 CIRCULATION Super millions lying idle Northern Territory News, Darwin, General News, Sophie Elsworth 12 Oct 2018 Page words ASR AUD 1,271 Photo: No Type: News Item Size: cm² NT Australia Industry Super Australia - Press ID: One Territorian has almost $700k waiting for them MORE than $200 million of Territorians' super is sitting idle waiting to be clawed by its rightful owners. View original - Full text: 315 word(s), ~1 min 11,279 CIRCULATION CBA 'abusing the law' fighting customers: Labor Australian Financial Review, Australia, Companies and Markets, James Eyers 12 Oct 2018 Page words ASR AUD 7,767 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Labor MPs have chastised the Commonwealth Bank for its aggressive litigation tactics and lack of empathy for aggrieved customers as the bank pledged to do more to ensure deceased estates haven't been charged inappropriate fees following scandals revealed by the royal commission. CBA chief executive Matt Comyn told a parliamentary committee 2500 of its bankers had failed risk management assessments during the latest performance reviews, while 41 employees had been sacked following cases exposed by the royal commission. Nine more had resigned while investigations against them were on foot. View original - Full text: 581 word(s), ~2 mins 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

23 BETTER CITIZENS Australian Financial Review, Australia, Boss, Sally Patten 12 Oct 2018 Page words ASR AUD 18,892 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Most companies are a long way from grasping what it means to have a social licence to operate. Jeffrey Tobias, an adjunct professor at the Australian Graduate School of Management at the University of NSW, recalls a conversation a couple of weeks ago with a banker on social licence. View original - Full text: 1226 word(s), ~4 mins 44,635 CIRCULATION IPO wins: PEXA board votes to take the company to the ASX Australian Financial Review, Australia, Companies and Markets 12 Oct 2018 Page words ASR AUD 3,499 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Property settlements exchange company PEXA's directors have voted to brave equity market conditions and seek to create Australia's listed technology sector unicorn. At a board meeting in Melbourne on Thursday, held as high-growth technology stocks were hit hard by the Australian market's $49.6 billion market rout, it is understood PEXA's board opted to strap on their hard hats and pursue an initial public offering as its preferred exit option. View original - Full text: 433 word(s), ~1 min 44,635 CIRCULATION READY TO PUNISH Australian Financial Review, Australia, Boss, Jemima Whyte 12 Oct 2018 Page words ASR AUD 9,931 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Bank board directors present and past will be in the firing line this annual meeting season as the impact from the Hayne royal commission hits. National Australia Bank and tainted bank board directors face a lash from investors in this year's annual general meeting season, as the Hayne royal commission has investors in the mood to punish individual directors. View original - Full text: 857 word(s), ~3 mins 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

24 Westpac warns on Hayne overreach Australian Financial Review, Australia, General News, James Eyers 12 Oct 2018 Page words ASR AUD 14,017 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Politicians should be wary that overloading new regulation on the banking sector in the wake of the Hayne royal commission could harm the economy by exacerbating the housing downturn and making it harder for businesses to borrow, Westpac Banking Corp CEO Brian Hartzer has warned. While acknowledging the "incredibly confronting" interim report published a fortnight ago and again apologising for the bank's misconduct, Mr Hartzer said he supports Commissioner Kenneth Hayne's call for simpler regulation. View original - Full text: 1072 word(s), ~4 mins 44,635 CIRCULATION Henderson guilty of FPA violations Australian Financial Review, Australia, General News, Joanna Mather 12 Oct 2018 Page words ASR AUD 2,994 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Former financial adviser Sam Henderson has been found to have breached professional standards - six months after appearing before the banking royal commission and nearly a year after the Financial Planning Association of Australia commenced disciplinary action. The FPA's independent disciplinary body found nine of 10 allegations against Mr Henderson to be "proven", although no sanctions were immediately imposed. View original - Full text: 307 word(s), ~1 min 44,635 CIRCULATION $17b super remains unclaimed Gold Coast Bulletin, Gold Coast QLD, General News, Sophie Elsworth 12 Oct 2018 Page words ASR AUD 550 Photo: No Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And the largest amount yet to be claimed has a staggering balance of $2.2 million. View original - Full text: 180 word(s), <1 min 21,468 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

25 Costello quizzes Morrison over economic narrative Australian Financial Review, Australia, General News, Patrick Durkin 12 Oct 2018 Page words ASR AUD 5,562 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Prime Minister Scott Morrison has rejected criticism by former Treasurer Peter Costello that the government doesn't have an economic narrative, after the Productivity Commission also took aim at ineffective government. Mr Costello told a Melbourne Institute conference in Melbourne on Thursday that he is still not sure what the government's economic narrative is, criticism that Mr Morrison later rejected as he formally announced the government would bring forward $3.2 billion in small and medium business tax cuts. View original - Full text: 626 word(s), ~2 mins 44,635 CIRCULATION A bank is no longer about banking Australian Financial Review, Australia, General News, Myriam Robin 12 Oct 2018 Page words ASR AUD 13,794 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: It was the sort of day that Commonwealth Bank chief executive Matt Comyn and Westpac boss Brian Hartzer would have liked to be holed up at head office. With global equity markets reverberating from a sell-off in the US bond market and ever-escalating trade wars, Australian shares copped the flow-on effect, with the ASX down 2.7 per cent, with $50 billion wiped off the value of local stocks. No doubt the bank CEOs would have liked to have been taking the temperature of their traders and treasury staff, watching funding costs and currency markets, and generally rallying the troops. View original - Full text: 1497 word(s), ~5 mins 44,635 CIRCULATION Sector told to model on professions Australian Financial Review, Australia, Companies and Markets, James Frost And Tony Boyd 12 Oct 2018 Page words ASR AUD 6,412 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Australia's top financial regulators have called on the industry to wake up and start acting like professionals as they set about rebuilding the reputation of a sector shaken by a steady flow of stories about misconduct. APRA chairman Wayne Byres has asked bankers and financial advisers to act more like doctors and lawyers in the quest to restore trust, while ASIC chairman James Shipton looked to the farming and mining sectors for examples of industries that have overcome adversity. View original - Full text: 793 word(s), ~3 mins 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

26 TAMING THE PAY MONSTER Australian Financial Review, Australia, Boss, Story Patrick Durkin Illustration Simon Letch 12 Oct 2018 Page words ASR AUD 29,126 Photo: Yes Type: News Item Size: 1, cm² National Australia Industry Super Australia - Press ID: Executive remuneration has hecome so complex, few can decipher it. But there is furious dehate on how to make it simpler. Did Domino's chief executive Don Meij really make $37 million last year, as outraged headlines screamed? Or was it the $4.66 million reported in the pizza giant's annual report? Or somewhere in between? View original - Full text: 2060 word(s), ~8 mins 44,635 CIRCULATION COME TOGETHER Australian Financial Review, Australia, Boss, Christine Holgate 12 Oct 2018 Page words ASR AUD 78,742 Photo: Yes Type: News Item Size: 3, cm² National Australia Industry Super Australia - Press ID: POST MODERN Australia Post chief executive Christine Holgete is ready to usher the organisation into a new era View original - Full text: 3322 word(s), ~13 mins 44,635 CIRCULATION EDITOR'S LETTER Australian Financial Review, Australia, Boss, Sally Patten 12 Oct 2018 Page words ASR AUD 4,612 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: Executive remuneration is a perennial thorn in the sides of directors and investors. It is also something of an obsession. The 2018 annual report of mining behemoth BHP mentions the word "remuneration" no less than 486 times. Little wonder that remuneration models ebb and flow as shareholder and community expectations change. The only constant seems to be that the models have become ever more complex. Five years ago, total shareholder return was pretty much the only determinant of executive bonuses. And in the olden days, bonuses were just that. Now, short-term incentives are almost part of fixed pay and the strong preference is to use so-called balanced scorecards, which take in objectives such as safety, customer satisfaction and diversity as well as financial measures. But, as one shareholder points out in Patrick Durkin's feature on page 20, it is a touch galling when a CEO earns a bonus for not killing anyone. Trust is a bit of a theme of this issue. Sadly in corporate Australia, there is not much of it about and so we take a look at some of the elements that can help to foster that trust. Ensuring executives are given the appropriate financial incentives is one, and then there is the monitoring of community standards, operating in a way that meets those standards, creating partnerships and making sure you are qualified to deliver on your promises. Australia Post chief Christine Holgate falls nicely into the discussion of trust. AustralianSuper boss Ian Silk notes that Holgate "puts a huge premium on personal and organisational trust", and indeed she puts much emphasis on the need to build the trust and respect of the organisation's 35,000 employees. View original - Full text: 321 word(s), ~1 min 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

27 DIFFERENT STROKES Australian Financial Review, Australia, Boss, Dominic Lorrimer And Elke Meitzel 12 Oct 2018 Page words ASR AUD 41,930 Photo: Yes Type: News Item Size: 2, cm² National Australia Industry Super Australia - Press ID: In a fast-changing world, companies are increasingly in search of fresh thinking and fresh approaches to give them the edge over competitors. In a duopolistic market such as Australia, a key way to achieve this can be recruiting executives from different industries. Anecdotal evidence from executive search firms suggests that more and more companies are doing just that. "Companies are trying to give themselves the edge with people who look at a problem from a different angle," says Robert Webster, a senior client partner at executive search firm Korn Ferry. "It has really taken off over the past 10 years with the digital revolution. People are more inclined to look for new thinking." View original - Full text: 2700 word(s), ~10 mins 44,635 CIRCULATION Comyn, Hartzer apologise for banks' failures The Australian, Australia, Edition Changes - All-round First, Ben Butler 12 Oct 2018 Page words ASR AUD 26,627 Photo: Yes Type: News Item Size: 1, cm² National Australia Industry Super Australia - Press ID: The boss of Australia's biggest bank was yesterday forced to tear up his diary and spend his afternoon listening to angry customers who confronted him during a parliamentary hearing in Canberra. Commonwealth Bank chief executive Matt Comyn and his counterpart at Westpac, Brian Hartzer, yesterday gave evidence to the House of Representatives economics committee's standing inquiry into the behaviour of the big four banks - their first appearances before parliament since financial services royal commissioner Kenneth Hayne slammed the sector for greed-driven wrongdoing in his interim report tabled a fortnight ago. View original - Full text: 1010 word(s), ~4 mins 94,448 CIRCULATION How to bring the big four to book? The Australian, Australia, Edition Changes - All-round First, John Durie 12 Oct 2018 Page words ASR AUD 16,491 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: What's the best way to bring the banks into line? In the eyes of Productivity Commission deputy Karen Chester, "policy architecture needs to do the heavy lifting". View original - Full text: 853 word(s), ~3 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

28 Shorten to shake up bank super The Australian, Australia, Edition Changes - All-round Metro, Simon Benson Rosie Lewis 12 Oct 2018 Page words ASR AUD 15,488 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: HEAT ON LABOR OVER COMPANY TAX CUTS Bill Shorten has flagged giving financial regulators the power to force bank-owned retail superannuation funds to appoint independent trustees to ensure members' interests are put ahead of profits when dealing with workers' compulsory retirement savings. View original - Full text: 1128 word(s), ~4 mins 94,448 CIRCULATION Shorten to shake up bank super The Australian, Australia, Edition Changes - All-round First, Simon Benson Rosie Lewis 12 Oct 2018 Page words ASR AUD 15,488 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: HEAT ON LABOR OVER COMPANY TAX CUTS Bill Shorten has flagged giving financial regulators the power to force bank-owned retail superannuation funds to appoint independent trustees to ensure members' interests are put ahead of profits when dealing with workers' compulsory retirement savings. View original - Full text: 1128 word(s), ~4 mins 94,448 CIRCULATION BIG BUX 'FRAUD' West Australian, Perth, Edition Changes, Tim Clarke And Gary Adshead 12 Oct 2018 Page words ASR AUD 13,412 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: $100 MILLION GONE Dudded investors count the cost View original - Full text: 531 word(s), ~2 mins 147,676 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

29 Bosses admit banks let their customers down West Australian, Perth, Edition Changes, Shane Wright 12 Oct 2018 Page words ASR AUD 7,802 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: The heads of the nation's two biggest banks have offered a mea culpa for the misbehaviour and "greed" of their institutions after warnings dodgy executives may face much tougher penalties in the future. Commonwealth Bank chief executive Matt Comyn and Westpac boss Brian Hartzer admitted to a parliamentary committee a series of failings that have been exposed by the "searing" interim report from the banking royal commission. View original - Full text: 394 word(s), ~1 min 147,676 CIRCULATION COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

30 Herald Sun, Melbourne Author: Jeff Whalley Section: Business News Article type : News Item Classification : Capital City Daily : 303,140 Page: 56 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 12,438 Words: 455 Item ID: Page 1 of 1 Greed wasn t good, CBA boss concedes JEFF WHALLEY BANKING COMMONWEALTH Bank chief Matt Comyn says the bank should have better protected customers instead of protecting commissions for financial advisers. And greed in some cases contributed to the problems that have beset the bank, Mr Comyn says. Appearing before a parliamentary inquiry into the big four banks, he yesterday acknowledged the lender Australia s biggest didn t go far enough in embracing industry reforms ushered in earlier this decade. He acknowledged the bank had taken the wrong approach to the Future of Financial Advice reforms introduced in Mr Comyn started as chief executive at the CBA this year, but has been with the bank for most of his career and ran its cornerstone retail banking division from We should have implemented FOFA in full, he said. I don t think we went far enough in removing things like conflicted remuneration. We focused too much on things like adviser viability. In retrospect, the bank would do things differently, he said. Mr Comyn conceded that in some cases greed fuelled the problems. We became complacent, he said. These failures are our fault and we are working very hard to address these failures. His comments echo those by banking royal commissioner Kenneth Hayne, who, in his interim report last month, cited greed as a cause for many scandals in the finance sector. The CBA earlier this week said that from January, it would rebate to customers all grandfathered commissions that had been paid to financial planners. New commissions to financial advisers were banned several years ago, but grandfathering provisions meant existing payment agreements continued. Mr Comyn said yesterday that systems to detect and fix problems could have been better, as could the leadership of the organisation. He also noted the scathing review published earlier this year by the banking watchdog, the Australian Prudential Regulation Authority, into the CBA s culture. The review was critical but fair, he said, and the bank was acting on its findings. After his appearance, Mr Comyn had a series of impromptu one-on-one meetings with six different customers who attended the hearings and approached him during the break. At the same inquiry, Westpac chief Brian Hartzer said his bank had also not handled the FOFA reforms as well as it should have. Mr Hartzer acknowledged he had not met any of the people who complained to the about their treatment at the hands of Westpac. Personally, of the ones that were in the commission, no, he said. Mr Hartzer said he regularly met with customers, including ones who had complaints. He accepted responsibility for misconduct at the bank and labelled the royal commission s interim report, published last month, as incredibly confronting and the stories are very sad. with THE AUSTRALIAN BANKING ROYAL COMMISSION

31 Herald Sun, Melbourne Section: General News Article type : News Item Classification : Capital City Daily : 303,140 Page: 6 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 11,938 Words: 352 Item ID: Page 1 of 1 Chase missing savings, taxman says SOPHIE ELSWORTH A POT of $17.5 billion in superannuation is unclaimed and the largest unclaimed account has a balance of $2.2 million. New figures from the financial year released by the Australian Taxation Office showed 6.2 million superannuation accounts, with an average balance of $2933, lay unclaimed by their owners. People who have changed jobs, moved house or forgotten to update their personal details are among those most likely to be missing retirement savings. In Victoria $3.5 billion in super is sitting idle in more than 630,000 accounts. The largest amount, $1.5 million, is in a Toorak account. Lost accounts are held by super funds when they have lost contact with the member and have not received a contribution for 12 months or more. A lost account becomes unclaimed, and is sent to the ATO where the amount is less than $6000. Accounts also become unclaimed when the super fund cannot contact individuals eligible to withdraw savings. The ATO s assistant commissioner, Graham Whyte, said Australians should check online to see whether they were owed missing super money they could recover. People have become disconnected and what we want to do is reconnect them, Mr Whyte said. The ATO has released postcode data that will allow people to check how much superannuation is lost or unclaimed in their area. Mr Whyte said the ATO was contacting superannuation fund members to try to reunite them with their hardearned savings. It s your money and you ve worked hard to earn it; it s your retirement savings, and you will need it one day, he said. Dr Martin Fahy, chief executive officer of the Association of Superannuation Funds of Australia, said people should be trying to recoup their money because these accounts earned only minimal interest of 2 per cent per year. A person aged 30 with $5500 in lost super held by the ATO will end up with $14,600 extra in their super account in today s dollars at the time of retirement at age 67, if they transfer that balance to their active account, Mr Fahy said.

32 Daily Telegraph, Sydney Section: General News Article type : News Item Classification : Capital City Daily : 232,067 Page: 15 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 12,333 Words: 391 Item ID: Page 1 of 1 Adding up the loose change Bank bosses try to repair the damage GREEDY, complacent and too slow to fix problems the bosses of the Commonwealth and Westpac banks yesterday admitted their institutions had a lot of changes to make up for the immense damage done to their customers. But at a parliamentary hearing in Canberra yesterday, Commonwealth Bank (CBA) chief executive Matt Comyn (pictured) and Westpac chief executive Brian Hartzer also said they had begun the epic task of rebuilding trust. Mr Comyn, who took the top job at the Commonwealth Bank six months ago, said the bank had been too slow to fix customer service problems. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Westpac was also too slow to grapple with customer issues, particularly in its financial advice services area, Mr Hartzer said. We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay. But the duo said they were attempting to rectify the mistakes. Both said they had have improved accountability by clarifying exactly what each of their senior executives are liable for. And they said incentives to staff at branches had also changed at both banks. Mr Cormyn said 41 Commonwealth staff had been sacked so another n down as th investigat I acc understan will judge and t Common weal t h Bank, on our actions, he said. Mr Cormyn said among the changes introduced were strengthened lending processes and making it simpler for customers to choose products. Mr Hartzer said improving Westpac s complaints process had been central to its response, with a new group executive hired to oversee it. From an overall reputation point of view, this is obviously going to take years to restore, Mr Hartzer said. The hearing comes two weeks after banking royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the purt for misconthe banking ncial services ANZ chief Shayne Ellipear on Frihile National ralia Bank ss Andrew Thorburn will appear next week.

33 The Australian, Australia Author: Perry Williams Section: Business News Article type : News Item Classification : National : 94,448 Page: 22 Printed Size: cm² Market: National Country: Australia ASR: AUD 12,555 Words: 641 Item ID: Page 1 of 2 Loss of corporate trust partly self-inflicted PERRY WILLIAMS INFRASTRUCTURE One of the nation s most influential company directors, Lindsay Maxsted, concedes that some of the loss of trust between the public and corporate Australia is selfinflicted and says boards must do more to explain the contribution of big business to communities and the economy. The Transurban chairman, who announced plans yesterday to step down in the next few years, is one of the country s most wellconnected board figures as a director of global miner BHP and chairman of Westpac, which is under intense scrutiny as part of the banking royal commission. Part of that loss depending on the company and the sector is self-inflicted and part of that is a diversion away from other topics that want to put blame on to the corporate sector for certain issues, Mr Maxsted told The Australian. Part of our job as boards and corporates it always has been but is probably more elevated now is to keep explaining those company messages and hope over time they resonate. Transurban, which bought a majority stake in Sydney s West- Connex motorway in August, also rejected criticism that it held a monopoly grip over Australia s toll road market and said its concessions had been acquired through competitive processes or project development proposals. Transurban now runs seven of NSW s nine toll-road concessions and 15 of 19 toll-road concessions in Australia, but it noted the competition regulator had cleared it of any monopoly concerns as part of its study of the WestConnex bid. We think that for many good reasons that we are a long, long way from being a monopoly, Mr Maxsted said. I can see why conceptually if you are the major operator and owner of an infrastructure-type asset all around the country and no one else is, people think that s a monopoly. But then you ve got to get behind that and understand how it gets awarded and how pricing works on a concession. The Transurban chairman first outlined his potential exit from the board in 2016, when he said he might not serve his full three-year term. That was widely interpreted as a pre-emptive move to potentially free himself up to replace Jac Nasser as BHP chairman, but he lost that battle last year to Ken Mac- Kenzie when he took the chairman reins. Mr Maxsted said yesterday the time was approaching for him to make way for his successor at Transurban. Two other Transurban directors, departing Seek chairman Neil Chatfield and former ANZ deputy CEO Bob Edgar, will also leave in the next few years. It s likely I will stand for reelection next year and then in October 2020 or October 2021 we can judge what is right for the company in terms of a succession plan, Mr Maxsted said. Mr Chatfield, a director of Transurban since 2009, was last week named chairman of poker machine maker Aristocrat Leisure. He is stepping down as Seek chairman in December and previously served as chair of Virgin Australia. Mr Edgar, also a Transurban director since 2009, is a former ANZ banker and holds director roles at Djerriwarrh Investments and Linfox Armaguard. There s also been speculation in the market over the tenure of chief executive Scott Charlton, who took on the top role at the infrastructure company in Mr Charlton noted yesterday that the company had reshaped its executive committee in the past year, with three of the four positions filled internally, showing the depth of its senior management talent. Mr Maxsted said that while the board regularly discussed the chief executive s tenure, there were no plans for the Transurban boss to leave in the short-term.

34 The Australian, Australia Author: Perry Williams Section: Business News Article type : News Item Classification : National : 94,448 Page: 22 Printed Size: cm² Market: National Country: Australia ASR: AUD 12,555 Words: 641 Item ID: Page 2 of 2 Chairman Lindsay Maxsted denies Transurban has a monopoly on the operation of Australia s toll roads HOLLIE ADAMS AUSE01Z01MA - V1 We think that for many good reasons that we are a long, long way from being a monopoly. LINDSAY MAXSTED, TRANSURBAN

35 The Australian, Australia Author: John Durie Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 17,237 Words: 890 Item ID: Page 1 of 3 How to bring the big four to book? JOHN DURIE What s the best way to bring the banks into line? In the eyes of Productivity Commission deputy Karen Chester, policy architecture needs to do the heavy lifting. Amid all the chatter about hopeless regulators and greedy banks, royal commissioner Ken Hayne has also made clear he supports Chester s stance in bemoaning the lack of competition for the big banks, which has allowed the greed and complacency. CBA chief Matt Comyn admitted as much yesterday. If the banks actually had to fight for their next dollar outside the cosy governmentsupported oligopoly then just maybe the culture inside the banks may be a little better. Chester told yesterday s Outlook conference, set the incentives and bandwidth of behaviour within which members and the trustees can coexist, monitored and enforced by confident regulators. That s the exactly how her Continued on Page 30

36 The Australian, Australia Author: John Durie Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 17,237 Words: 890 Item ID: Page 2 of 3 Increased competition will help change banks behaviour JOHN DURIE Continued from Page 19 final report on superannuation will read, with default super taken out of the industrial relations architecture and subject to competition. In the same session at the conference yesterday, opposition Treasury spokesman Chris Bowen would have also pleased the Productivity Commission with his promise to create a new COAG economic council. The reality is that the long list of productivity reforms suggested by the commission but now gathering dust next to Prime Minister Scott Morrison s Tim Tams depend crucially on state and federal consultation and agreements. This government has trashed the process of state relations, most notably with the sudden abandonment of the National Energy Guarantee plan just days after the states signalled their support for the program. Former energy minister and now Treasurer Josh Frydenberg had done all the hard work with the states and his own party, and only six votes stood between a deal and a shattering of state relations. Former prime minister Malcolm Turnbull chose the latter option and Morrison has followed suit. Now we enter a year of state and federal elections in which getting any sort of agreement with Victoria and NSW going to the polls will be difficult. Full marks, then, to Bowen for actually putting in place a formal mechanism to clear this deadlock across a range of productivity measures. Chester s speech in Melbourne came on the same morning that former Lloyds chief Dame Susan Rice was telling a FINSIA conference of the need for professional standards among bankers and annual testing of those standards, as adopted by Britain under Rice as the chair of the Chartered Banker Professional Standards Board. This a journey FINSIA s Chris Whitehead has been on for a couple of years, with the idea being a bank may commit to standards (hopefully) but it makes little sense unless the actual people follow, and the best way to achieve this is by enforcing professional standards. CBA s Comyn and Westpac s Brian Hartzer spent the day being rapped on the knuckles by the House Economics Committee. But the reality is more a lesson on just why top barristers earn the big dollars because, frankly, the politicians didn t go close. But come next month s hearings before the royal commission the standard of debate will be somewhat higher. Chester s speech in the Outlook session on growth with equity noted that while the commission s recent paper reported only modest increases in inequality in Australia the reality was some two million Australians remain in relative poverty. Eighty per cent of this group stay there for less than three years but there are still 600,000 who are entrenched and it is this group which needs to be helped They are there, she says, due to one or more of mental health, indigeneity, chronic disease and intergenerational poor economic participation. The equalising effect for those not affected by these issues has been in part the progressive taxation system and continued social welfare in terms of aged pension, family tax benefit and disability support. In terms of long-term growth, she says one of the key policy concerns is education. The performance in key subjects like maths and reading is worsening, vocational training is a mess and universities need to deliver qualifications that the labour market wants. Chester notes that for each job change today, 50 per cent of people change sectors, highlighting the need for change. She said: The paucity of program evaluation is beyond perverse in today s data and analytics-driven world. After 26 years of compulsory super the present PC inquiry is the first time in 26 years a government has asked whether the $2.7 trillion system is efficient and competitive for its 14.8 million members. The industry, Chester notes, suffers from compulsion, complexity and cognitive biases due in large part to ineffective competition. Chester wants an improved role for the Parliamentary Budget Office in providing longer-term fiscal projections and testing. Health is a big issue given seven million Australians have chronic conditions like diabetes and mental problems. One in four adults are obese and in all the result is a block to economic participation in short health issues are holding economic growth. The entrenched disadvantaged is a drag on the economy and needs to be addressed.

37 The Australian, Australia Author: John Durie Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 17,237 Words: 890 Item ID: Page 3 of 3 KRYGSMAN S VIEW Opposition treasury spokesman Chris Bowen AUSE01Z01MA - V1 Many have wondered how Telstra boss Andy Penn has kept his job... and here goes the board handing him a $3.2m bonus. JOHN DURIE

38 The Australian, Australia Author: Rosie Lewis Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 15,024 Words: 651 Item ID: Page 1 of 3 Chief faces the wrath of customers ROSIE LEWIS BEN BUTLER BANKING CBA boss Matt Comyn had planned to meet just one angry customer yesterday Selwyn Krepp, who ran an accommodation business in Cairns that the bank foreclosed on in But after being surrounded by people keen to tell him exactly how badly they had been treated by the bank during a break in testimony to the House of Representatives yesterday morning, he ended up talking to half a dozen. The morning tea break came after two hours of testimony from Mr Comyn during which he repeatedly apologised for the scandal-ridden bank s misconduct and wrongdoing over the years as onlookers in the public gallery jeered and heckled. Mr Krepp wrote to Mr Comyn late last month, demanding a personal meeting rather than one Continued on Page 23 Comyn faces the wrath of CBA customers Continued from Page 19 with one of the chief executive s lackeys and time-wasters. Mr Krepp said the bank contacted him on Wednesday, proposing a meeting yesterday afternoon after the hearing. But during the break somebody bounced up and then somebody else bounced up, so then he decided what he would do is he would remain in the building, he said. This morning as (Labor MP) Clare O Neill started to unfold case histories and mention a particular case history, we had another one of our colleagues sitting there who was in the same scenario. They called a 15-minute health break and then everyone surged on Matt Comyn and said, Hey, you listen to that story, Deb s the same and Deb s written several letters to you and you won t meet with her. Mr Krepp said the bank foreclosed on his business in 2013 even though he hadn t missed a payment, causing members of his family to believe he must have done something wrong. Just give me the chequebook, sign and I ll fill in the missing amounts, he said. I ll be looking for remediation and compensation. I m hoping that remediation and compensation will repair my family. In all, Mr Comyn and his executive team spent 90 minutes talking to angry customers including former Central Coast publican Bob Bourne. He is one of a large group of businesspeople who borrowed money from Bankwest, only to have CBA shut down their line of credit when it took over the bank during the global financial crisis in 2008 a $2.1 billion deal rushed through as Bankwest s British parent HBOS teetered on the brink of collapse. The human cost of CBA s swift and brutal clean-up of the loan book, dubbed Project Magellan, was exposed at financial services royal commission hearings in May but the probe stopped short of finding any misconduct by the bank. They did me over real bad, Mr Bourne said. In the end I owed them $12 million. All the businesses they took off me are still trading profitably. I built five pubs with their approval and I built five ancillary businesses around them. I m now on an aged pension staying at the Y for $31.

39 The Australian, Australia Author: Rosie Lewis Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 15,024 Words: 651 Item ID: Page 2 of 3 He said the performance of the MPs who grilled Mr Comyn and Westpac CEO Brian Hartzer yesterday was brilliant. They tore their arses off. They pushed them into submission and then he (Mr Comyn) agreed of his own volition to give us 15 minutes. Mr Bourne said that in the end he spent half an hour talking with Mr Comyn and a CBA lawyer who had written him some of the legal letters from the bank. He said he told the lawyer that when he wrote a letter he should sleep overnight and then put himself in a victim s shoes. They ve got no heart, he said. They set you up to fail. Mr Bourne was sceptical the meeting with Mr Comyn would get him anywhere. Don t forget he s a f..king banker, he said.

40 The Australian, Australia Author: Rosie Lewis Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 15,024 Words: 651 Item ID: Page 3 of 3 Unhappy CBA customers Selwyn Krepp and Bob Bourne wait to confront Matt Comyn in Canberra yesterday GARY RAMAGE

41 Daily Telegraph, Sydney Author: Sophie Elsworth Section: General News Article type : News Item Classification : Capital City Daily : 232,067 Page: 5 Printed Size: 91.00cm² Market: NSW Country: Australia ASR: AUD 4,300 Words: 196 Item ID: Page 1 of 1 No accounting for waste in $2m super blooper EXCLUSIVE SOPHIE ELSWORTH SOMEWHERE out there is an absent-minded Sydneysider who has inexplicably forgotten they possess one super-sized superannuation account. Among the list of lost and unclaimed super identified by the Australian Taxation Office in is a single account containing $2.2 million. It belongs to a one-time Killara resident who has moved on and lost touch with their super fund. The amount is almost 10 times the average balance at retirement age and is enough to provide a 65-year-old retiree almost $100,000 a year until they are 89. It is the biggest unclaimed amount in a massive $17.5 billion pot of superannuation savings in 6.2 billion accounts waiting to be clawed by their rightful owners. In NSW $4.9 billion in super is sitting idle in more than 916,000 accounts an average balance of more than $5300. The money is in lost or unclaimed super accounts those where the fund has lost contact with the member and has not received a contribution for 12 months or more. The account becomes unclaimed and money is sent to the ATO when the balance is worth less than $6000. To check your super accounts go to the ATO website.

42 The Australian, Australia Author: Damon Kitney Section: General News Article type : News Item Classification : National : 94,448 Page: 9 Printed Size: cm² Market: National Country: Australia ASR: AUD 4,785 Words: 581 Item ID: Page 1 of 1 STANDARDS Customer comes first, says milk boss DAMON KITNEY Leading chief executives and company directors have urged corporate Australia to focus less on making profits and more on satisfying and providing results for customers and clients in the wake of the damning findings of the banking royal commission. Speaking at the Melbourne Institute/The Australian Economic and Social Outlook conference in Melbourne yesterday, A2 Milk Company chief executive Jayne Hrdlicka said more companies had to build their businesses from the customer and some of the behaviour of the banks and others in the financial services sector could never be justified. These are not isolated cases. It is not like one person did it. There are significant numbers of people who engaged in behaviour that is just wrong, she said. All of us are customers of the banks. Probably nobody in this room was surprised to hear the findings. We are customers. You know the attention to you as a customer and trying to understand what your needs are, it just didn t exist at the right level. Ms Hrdlicka said companies that did the wrong thing by their customers lost the right to be given the opportunity by investors to focus on the future challenges facing their businesses and how they should respond to disruption. I think what happens when you have very big business, you have an obligation to understand from the top to the bottom that the culture is right, that the systems to protect people from doing the wrong thing are right, she said. And that you can feel confident when you go to sleep at night that the business is carrying itself in a way that is consistent with the values of the organisation. If it is not that, you have to fix it. If you have not been paying attention to the bread and butter of your business, then you have not earned the right to spend the time thinking about new horizons and how to go after them. The Hayne royal commission interim report released a fortnight ago found there were firms and individuals across the financial services sector motivated by financial gain or short-term profit at the expense of basic standards of honesty. While he made no findings on breaches of the law, he identified conduct by companies and employees that may amount to misconduct or that fell below community standards and expectations. Wesfarmers and AGL Energy director Diane Smith-Gander said the findings of the royal commission had come arguably at the worst time for business. Here we are in a moment when business needs to be at the top of its game and addressing its challenges, we have limited trust with the community, she said. The rest of us have to learn from the issues that have come out of the royal commission and find ways to make our own cultures more bullet-proof and our own conduct something that we can be proud of. But she said the community could not unreasonably expect that everything in business could be perfect all of the time. The idea that everything every time, everything can be perfect and nothing is ever going to be wrong is just not real, Ms Smith-Gander said. We have to accept there will be failures and things we will not be proud of. And it is about do you look hard enough to find them and are there consequences once you find them. I don t think we are good at consequences in this country. BUSINESS P19 JOHN DURIE P19

43 The Australian, Australia Author: Damon Kitney Section: General News Article type : News Item Classification : National : 94,448 Page: 9 Printed Size: cm² Market: National Country: Australia ASR: AUD 5,300 Words: 592 Item ID: Page 1 of 1 Future investment is business s big challenge DAMON KITNEY ANALYSIS Wesfarmers and AGL Energy director Diane Smith-Gander made a powerful point yesterday when she said the royal commission into our biggest industry, the financial services sector, had come at precisely the wrong time. Of course no one can excuse the outrageous, immoral behaviour that has been highlighted by the months of hearings, culminating in appearances before the commission yesterday of the chief executives of two of the big four banks. But the distrust that the findings of the royal commission have engendered in the business community and the prospects of increased regulation likely to flow from it is going to have far reaching consequences beyond the banking sector. As Smith-Gander pointedly asked yesterday, will Australian businesses be prepared to make the tough decisions now to ensure their future in a rapidly changing world of disruption? We see the difficulties, we see disruption, we see the future of work changing, we see inequality in gender but are we able to find a way towards fixing those issues? she asked. You can say I ll be fine in the Australian market. We have a market of 25 million people and we can focus on that. But the problem is if your offerings are not globally distinctive, someone is going to come from offshore and take your domestic market away from you. As Andrew Bassat put it, increasing pressure from regulators, shareholders and government is coming at a time when Australian companies are losing more than they are winning on disruption. The chief executive of Seek boldly warned that in 10 years, the nation s top 100 companies would have fewer employees and produce lower revenues and profit numbers than they do today. One of its biggest challenges is how to manage the impact of disruption and the rise of artificial intelligence on its labour force. The banks have talked about 20,000 jobs going over the next few years. Finding jobs for those people, the banks are trying, they are putting a bit of money there, but at the end of the day the government is not trying to solve that issue, Bassat said. We are going to have a lot of people out of work that nobody is going to take responsibility for dealing with, to retrain, make sure the money is there There are lots of businesses being disrupted that have to let people go We see some of those people knocking on our door and the government will not pay to retrain them. Smith-Gander said that while the labour market in the past had been able to absorb the impact of big structural changes in the workforce, there were real questions about how it could do it in the future. Where are the entry level jobs for my children? That is the bit I am worried about, because the cycle time of disruption is shrinking all the time, she said. It feels like the cycle time of change in our education system is not keeping up with that. And then, for big listed companies, there is the challenge of investors who are demanding shortterm returns and becoming increasingly vocal. Convincing them of the benefits of sacrificing short-term profits at the expense of investing in the future is not easy. As a2 Milk CEO Jayne Hrdlicka put it, companies must hold the line. It takes bravery to stare into it and say we are taking a long-term mindset disruption is coming, we need to be part of it, she said. We need to be bold and push on investors.

44 The Australian, Australia Author: Michael Roddan Section: General News Article type : News Item Classification : National : 94,448 Page: 9 Printed Size: cm² Market: National Country: Australia ASR: AUD 3,525 Words: 353 Item ID: Page 1 of 1 Bowen raises concerns for super top-10 list SUPERANNUATION MICHAEL RODDAN Opposition Treasury spokesman Chris Bowen has laid out concerns about the Productivity Commission s recommendation to shakeup the $2.7 trillion superannuation sector in the interests of savers. Mr Bowen, speaking at the Economic and Social Outlook Conference yesterday, said Labor foresaw some unintended consequences of the commission s proposal for a single top 10 best-in-show list of the country s highest performing super funds based on a range of metrics. That is something we have expressed concern about, Mr Bowen said. It is a big call to have 10 best-inshow funds. That would have some competitive impacts. The union-and-employeeed industry fund sector has complained about the commission s recommendation that default super arrangements be broken from the enterprise bargaining system and that the Fair Work Commission s role as arbiter of the default super allocation be scrapped for an independent panel of experts. Productivity Commission deputy chairman Karen Chester, who led the department s landmark review of the super system, told the conference she would be closely watching the last public round of hearings for the financial services royal commission before handing down the final report for the review of the super system. This is a once in a lifetime, for me in a public policy sense, to have planets align where you have the bookends of the Productivity Commission s report on the financial system, the Productivity Commission report on super, looking at the public policy architecture and the evidence base, and all of that feeding into and informing a royal commission, Ms Chester said. Mr Bowen said Labor was still committed to increasing the super guarantee to 12 per cent, up from its current rate of 9.5 per cent. Nine-and-a-half is not adequate. We need 12 for adequacy, Mr Bowen said. I am interested in the health of the superannuation sector as a whole. Funds that aren t performing is a matter for them to communicate to potential clients. Mr Bowen said the PC s recommendations, to be made in a final report due by the end of the year, would need to be considered by the government of the day sideby-side with the royal commission s final report.

45 The Australian, Australia Author: Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 16,774 Words: 842 Item ID: Page 1 of 3 Comyn, Hartzer apologise for banks failures BEN BUTLER FINANCIAL SERVICES The boss of Australia s biggest bank was yesterday forced to tear up his diary and spend his afternoon listening to angry customers who confronted him during a parliamentary hearing in Canberra. Commonwealth Bank chief executive Matt Comyn and his counterpart at Westpac, Brian Hartzer, yesterday gave evidence to the House of Representatives economics committee s standing inquiry into the behaviour of the big four banks their first appearances before parliament since financial services royal commissioner Kenneth Hayne slammed the sector for greeddriven wrongdoing in his interim report tabled a fortnight ago. An apologetic Mr Comyn admitted that greed was part of the reason behind a decade of scandal and shame at CBA and promised the bank was working very hard to fix its broken culture. Mr Hartzer also said he apologised unreservedly to the customers we have let down. But under questioning from Labor s Matt Thistlethwaite, he admitted that he had not personally met with a single customer who appeared at the royal commission. Mr Comyn s talk of greed was echoed by the corporate watchdog as regulators yesterday took stock of Mr Hayne s bombshell report. Speaking at a conference in Sydney, Australian Securities & Investments Commission chairman James Shipton said the 80sera idea that greed is good was a crazy mindset. We need education programs that highlight there is a noble purpose to finance, he said. That is something we need to rebuild. Sister agency the Australian Prudential Regulation Authority, which was attacked by Mr Hayne for never having taken legal action to enforce banking and superannuation laws, told the conference it would be moving towards more forceful enforcement. The royal commission has suggested, among other things, that regulators can and should do more to actively enforce standards of behaviour within the financial sector, and punish those who breach them, APRA chairman Wayne Byres said. Based on what has been revealed, that is a quite reasonable conclusion. Scandals at CBA have included the exposure of dodgy financial advisers, out-of-date medical definitions and dubious claims refusals at insurance arm Comm- Insure, and the charging of fees for no service. Mr Comyn told parliament that within CBA there had been failures of leadership, a failure to invest in compliance systems and in some cases greed. We became complacent, he said. The misconduct exposed by the royal commission was due to a number of significant failures on our part, he said. These failures are our fault and we are working very hard to address these failures. He said a scathing review commissioned by APRA presented a critical but fair view of the bank, which was implementing its recommendations in full. And he admitted the bank s successful lobbying efforts to water down Future of Financial Advice reforms introduced in 2014 was misguided. We should have implemented FoFA in full, he said. Continued on Page 23 RICHARD GLUYAS P23

46 The Australian, Australia Author: Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 16,774 Words: 842 Item ID: Page 2 of 3 We became complacent COMMONWEALTH BANK CEO MATT COMYN AT THE HOUSE ECONOMICS COMMITTEE Chief executives apologise for banks wrongdoings Continued from Page 19 I don t think we went far enough in removing things like conflicted remuneration. We focused too much on things like adviser viability. Under questioning from Labor s Matt Keogh, the bank s chief risk officer, David Cohen, revealed the bank successfully negotiated down a community benefit payment it agreed to with ASIC as part of an enforceable undertaking signed in April. CBA agreed to make the $3 million payment after failing to produce any evidence it had provided services to more than 31,000 customers to whom it has paid almost $90m in compensation. Mr Keogh asked: Did you start at a lower amount? Yes, we did, Mr Cohen responded. Asked how much ASIC initially asked for, Mr Cohen said: I believe it was a little bit higher than that $3m amount. He said he regularly met with customers, including ones who had complaints. But under questioning by Mr Thistlethwaite, the committee deputy chairman, Mr Hartzer admitted he had not met any of the people who complained to the commission about their treatment at the hands of Westpac. Personally, of the ones that were in the commission, no, he said. An interim report released by Mr Hayne last month was incredibly confronting and the stories are very sad, he said. On behalf of Westpac I d like to once again apologise PICTURE: GARY RAMAGE

47 The Australian, Australia Author: Ben Butler Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 16,774 Words: 842 Item ID: Page 3 of 3 unreservedly to the customers we have let down. He said Westpac had improved its remuneration by decoupling most pay from sales, hired a new top-level executive to deal with customer complaints, and said the bank had poorly handled the move away from the commissionbased model for advice that was in place before the 2014 Future of Financial Advice reforms. It s really clear that we have a lot of work to do to restore community trust, he said. Asked by committee chairman and Liberal MP for Goldstein Tim Wilson if the buck stopped with him, Mr Hartzer said: Absolutely, as the chief executive I m ultimately responsible for everything that goes on at the bank. The committee will hear from ANZ s Shayne Elliott today and NAB s Andrew Thorburn next Friday.

48 The Australian, Australia Author: Will Glasgow Christine Lacy Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 13,584 Words: 474 Item ID: Page 1 of 2 MARGIN CALL WILL GLASGOW & CHRISTINE LACY Suncorp s Birdcage withdrawal Kenneth Hayne s royal commission has set off a crisis right at the top of Michael Cameron s financial giant Suncorp. For as long as anyone can remember, the $17.8 billion Queensland-based Suncorp has had a blue-chip marquee in Flemington s Birdcage for the Spring Racing Carnival. Not this year. With Derby Day only three weeks away, Margin Call can reveal racing history will soon be made. This year we have changed our approach and decided not to continue with the Chairman s Marquee, a Suncorp spokesperson confirmed to us. The reason? This decision reflects the changing priorities of our business, was the spokesperson s taciturn answer. Others have told Margin Call the historic decision is directly linked to Hayne s financial services royal commission. They decided, belatedly, that it s a bad look, a source tells us. The company through its AAMI insurance brand remains a big commercial partner of the nation s biggest racing week. While they won t have a branded Birdcage presence (and spot for their executives and directors to quaff champagne with their mates), AAMI will continue as the naming sponsor for Derby Day And the financial shop s uneasiness is someone else s opportunity. We re told the spot one of the Birdcage s rare venues to afford views of the track has been rebranded The Loft and will be subleased. No word yet on whether anyone has signed up. The abrupt change coincides with Christine McLoughlin s elevation as Suncorp chair last month, a role she took over from marquee enthusiast Ziggy Switkowski. It s worth noting former Labor finance minister Lindsay Tanner a man with a keen political antenna has joined the Suncorp board since last Continued on Page 20 Suncorp withdraws from the Birdcage Continued from Page 19 year s racing carnival. It s not clear whether chair McLoughlin or her CEO Cameron who the Australian Financial Review once dubbed the the most unpopular CEO in the [ASX] top 100 led the decision. Also not clear is where the nation s director class is going to spend Derby Day now that Suncorp s corporate oasis has packed up. The Suncorp-AAMI marquee was particularly popular with the director set because of its Guy Grossiprepared sit-down lunch and strict door policy on media. Last year, for example, Cameron and Switkowski hosted the now former ABC boss Michelle Guthrie, plus a bevy of keen royal commission watchers (a few of whom have gone on to be participants), including AMP director John O Sullivan, Australian Banking Association head Anna Bligh, AustralianSuper boss Ian Silk, QIC CEO Damien Crawley, Balanced Equity Management chief Andrew Sisson, Industrial Relations Minister Kelly O Dwyer and her UBS banker husband Jon Mant. Those were the days.

49 The Australian, Australia Author: Will Glasgow Christine Lacy Section: Business News Article type : News Item Classification : National : 94,448 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 13,584 Words: 474 Item ID: Page 2 of 2 Michelle Guthrie in the Suncorp marquee Also not clear is where the nation s director class is going to spend Derby Day now that Suncorp s corporate oasis has packed up. MARGIN CALL

50 The Australian, Australia Author: Richard Gluyas Section: Business News Article type : News Item Classification : National : 94,448 Page: 23 Printed Size: cm² Market: National Country: Australia ASR: AUD 7,564 Words: 763 Item ID: Page 1 of 1 In for the long haul: Byres s call to lift industry standards of behaviour begins with regulator RICHARD GLUYAS COMMENT APRA boss Wayne Byres s clarion call in response to the disgraceful behaviour highlighted in the financial services royal commission is to lift the standard of behaviour by all industry participants, including regulators. It s hard to disagree, but there s a long way to go. In a footnote to Byres s speech, he pointed to an extraordinary anomaly in the industry s regulatory structure. APRA s approach to prudential supervision of banks is regularly assessed against the core principles for effective banking supervision set down by the Basel Committee for Banking Supervision. Only one of those 29 principles bears some relationship to conduct risk or misconduct. So, a decade after a nearcomplete meltdown in the global financial system, where misconduct and poor industry behaviour played a pivotal role, questions of conduct barely rate a mention in the checklist of responsibilities for a competent prudential regulator. That s bad enough in itself. But it gets even worse when you realise that Principle 2 the one where misconduct makes a token appearance refers to misconduct not by banks but by the head of a supervisory agency. While ASIC got touched up pretty badly in Kenneth Hayne s interim report, APRA s reputation also took a substantial hit. Hayne noted the prudential regulator was required to examine the issues of governance and risk culture in the context of the stability of the financial system. Even so, Hayne said APRA never went to court. When APRA announced its prudential inquiry into Commonwealth Bank, it justified the move by saying there were so many incidents in its recent history that had damaged its reputation and public standing. Until then, APRA had taken no public step that pointed to any deficiency in the governance and risk culture at CBA, or its peers. Byres had no intention of responding to Hayne s critique at the Finsia conference. But like many others, he realises resistance is futile in the new era of doleful banks and downcast regulators. The royal commission has suggested, among other things, that regulators can and should do more to actively enforce standards of behaviour within the financial sector, and punish those who breach them, Byres said. Based on what has been revealed, that is quite a reasonable conclusion. Consistent with prudential supervisors around the world, APRA has traditionally examined cases of poor conduct as an indicator of risk but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of an individual institution. We will clearly need to reflect on that approach. Enough of the self-examination the regulators wouldn t need to flagellate themselves if the industry had behaved, and clearly it hasn t. Both Byres and his co-speaker, new ASIC boss James Shipton, levelled their sights on bankers, saying they had to professionalise like other industries where the stakes were high, including medicine and the law. Shipton said the notion greed was good had infected the finance industry when he was at university. It was a crazy mindset, and education programs were needed to highlight there was a noble purpose to finance. Professionalism had to be at the heart of what the industry did, and the workforce had to be educated so it was more aware of the critical role financial services played in the economy. For Byres, there s an historical explanation for the industry s greed is good ethos. It goes to the deregulation that followed the Campbell inquiry in the early 1980s, when the boundaries of the financial sector began to blur. The removal of regulatory shackles might have been the perfect time to establish stronger professional standards, but the liberal philosophy of the time triumphed over personal and corporate restraint. At present, none of the industries regulated by APRA was recognised as a profession with a defined body of knowledge or high entry standards for those performing key roles. Where codes of conduct exist, they are often totally voluntary, Byres said. And on the evidence before the royal commission, the balance between self-interest, company interest and serving the community s interest has not always been appropriately struck. The APRA boss was right in saying the industry performed well in some dimensions, such as soundness and resilience. The system was also efficient. But when it came to the issues of fairness and accountability spotlighted by the royal commission, the industry came up short. Professional standards are part of a complex, wider solution, but it will take a long time for the industry to recover its trust and reputation.

51 The Australian, Australia Author: Robert Gottliebsen Section: Business News Article type : News Item Classification : National : 94,448 Page: 30 Printed Size: cm² Market: National Country: Australia ASR: AUD 9,442 Words: 908 Item ID: Page 1 of 2 SAVINGS REVOLUTION DAWNS An avalanche of money is flowing to the industry funds ROBERT GOTTLIEBSEN As the fall in global sharemarkets gathers momentum, Australia is starting to experience what looks like being one of the largest savings revolutions in our history. I will discuss the sharemarket fall later, but ever since the royal commission into banking and finance began to reveal bad practices in major retail superannuation and insurance giants, most people predicted that over time the retail funds would lose market share in favour of the industry superannuation funds, which came out of the inquiry almost unscathed. But the flow to industry funds has started quickly and, while it is early days, an avalanche of nation-changing proportions may be developing. Australia s largest superannuation fund, AustralianSuper, has experienced a doubling of its cash inflows in the last two months when compared with the corresponding two months last year. No one knows whether this initial avalanche is the forerunner of much bigger flows or whether it is simply an initial reaction. The other industry funds have also received much higher inflows but for the largest Australian fund to double its inflows is unprecedented. AustralianSuper has some $140 billion under management and last year cash inflow was $9bn. If the current trend continues, the yearly inflow will be $18bn. Originally AustralianSuper optimistically thought that inflows might rise by one third over the year, and that still might be right. Doubling the rate of cash inflows is unprecedented and the extra money has come from all sources advisers, small and large enterprises and individuals. Currently there is in the vicinity of $630bn in retail funds and the industry funds have about $650bn. All we can say at this stage is that the amount of money in retail funds is set to fall substantially. Again, we don t know which retail funds will be hit the hardest but the most vulnerable are AMP, NAB s MLC and Commonwealth Bank s Colonial. The sharemarket has already slashed the value of AMP shares by more than 40 per cent. If the avalanche to industry funds hits MLC and Colonial, then the book value of the enterprises will need to be reduced. Both NAB and CBA plan to dispose of the businesses but their value will depend on whether the initial rush to AustralianSuper and industry funds is maintained. If any retail fund loses critical mass it will need to merge and we can expect massive cost-cutting. AustralianSuper used to manage about one third of its money and contract out the remainder. It plans to increase its own management to 50 per cent and that 50 per cent will include the extra funds. Conservatively, including earnings retained in the fund and the cash inflows, within two or three years AustralianSuper will be a $200bn-plus fund. Most, but not all, industry funds are based in Melbourne while AMP, MLC and Colonial are based in Sydney. We are looking at a transfer of financial power to Melbourne. It s ironic that one of the reasons the major retail funds have not performed as well as the industry funds is that the retail funds were always nervous about a run on their money, so did not invest as heavily in commercial building and infrastructure, fearing a liquidity crunch. The industry funds, as default funds, did not have the same fear of a run on their money and invested more heavily in commercial property and infrastructure. In a lowering interest rate environment these sectors performed extremely well and contributed to the better performance of the industry funds. AustralianSuper has 7.1 per cent of its funds in direct property and 11 per cent in infrastructure. Because they have been prepared for it most, if not all, the retail funds will be able to handle a run in their funds and, of course, not all will be affected. It s ironic that the low global interest rate environment, which in part drove the success of the industry funds, is now changing. As Michael Roddan revealed in The Australian, AustralianSuper has warned those who have taken the option of structuring their fund so that about 70 per cent is in property that they may lose their liquidity. Only about 4000 people have done this and those who select their own fund composition are only about 1 per cent of AustralianSuper. But as I pointed out yesterday, it is an important signal that the boom is over. And on Wall Street US bond prices again fell, so lifting yields and making share investors very jittery. American shares are priced on the basis that nothing will go wrong. Three things are going wrong the US-China trade war, the shortages of labour and, most importantly, interest rates are rising. The combination of these three events causes a lowering of the risk appetite and people start looking for safer havens for their money to ride out current turmoil. As a result, tech stocks such as

52 The Australian, Australia Author: Robert Gottliebsen Section: Business News Article type : News Item Classification : National : 94,448 Page: 30 Printed Size: cm² Market: National Country: Australia ASR: AUD 9,442 Words: 908 Item ID: Page 2 of 2 Amazon, Facebook, Netflix and others were among the most severely affected. At this stage the fall is merely a correction. If US bond rates continue to rise then it will change the bond-share equilibrium in the market and bigger falls are likely unless profit growth stays at very high levels. Higher global interest rates will affect the cost of overseas borrowing in Australia and puts pressure on the Australian dollar. And all this is happening at a time when many Australians are changing the management of their savings.

53 The Australian, Australia Author: Scott Murdoch Samantha Bailey Section: Business News Article type : News Item Classification : National : 94,448 Page: 23 Printed Size: cm² Market: National Country: Australia ASR: AUD 10,291 Words: 630 Item ID: Page 1 of 2 Sector must put clients first, says ASIC head SCOTT MURDOCH SAMANTHA BAILEY REGULATION FINANCIAL SERVICES ROYAL COMMISSION Australian Securities & Investment Commission chairman James Shipton has said the financial services industry needs to be made noble and lose the focus on greed to regain the trust of the community after the royal commission. Mr Shipton said the commission s interim report by Justice Kenneth Hayne, which found the local industry was dishonest, should serve as a major wake-up call to bankers. In his first public comments since the report was delivered, Mr Shipton said he believed the sector had become too atomised and that workers had lost sight of the industry s broader purpose and the role that financial services should serve in the economy. We are dealing with other people s money. We have to recognise that is the starting point of what we do, Mr Shipton told a Finsia conference yesterday. We have to move away from this conclusion of dishonesty professionalism has to be at the heart of what we do. We need to have that as our single aim. We need to have a strong and efficient financial services system for all Australians. ASIC will deliver its formal written response to the royal commission s interim report by October 26. Mr Shipton will appear at a joint parliamentary committee in Canberra next week, when he is expected to be questioned on the future role that ASIC will play if the government introduces greater regulation following the royal commission. In his first report, Justice Hayne took aim at APRA and ASIC for not allowing vigorous competition in the financial sector and said the limited number of players had contributed to wrongdoing becoming prevalent. The report also said ASIC was too friendly towards the banks and its remit was too wide. Mr Shipton said he believed it was vital that the future workforce of bankers be educated to be more aware of the role financial services plays in an economy. We need to make sure that there are young men and women moving from high school to university who learn about the broader purpose of finance, he said. When I was at university, it was at the time of Wall Street and the notion that greed is good. That was the mindset of a lot of people. That s a crazy mindset. We need education programs that highlight there is a noble purpose to finance. That is something we need to rebuild. Mr Shipton said he believed the financial services sector needed to look at other customer-related industries, especially medicine and aviation, which had adapted to implementing major cultural changes. We can learn from other industries in doing this, he said. At the Finsia conference, APRA chairman Wayne Byres emphasised the importance of human decision-making on the financial sector in the wake of the royal commission, as he downplayed the immediate relevance of digitisation in solving the problems of the sector. He said that while the idea of encouraging decisions to be made by a computer program unswayed by a short-term bonus has appeal, it would take human character traits such as leadership, judgment, a strong ethical and moral compass to fix the cultural and corporate governance flaws in the sector that had been exposed in the royal commission. The royal commission process has shone a light on the alltoo-human flaws that have badly tarnished trust in the financial sector, Mr Byres said. The increasing dependence on technology may help address some of these issues, by removing those flaws from some decisionmaking. But it won t solve the entirety of the problems, at least not any time soon.

54 The Australian, Australia Author: Scott Murdoch Samantha Bailey Section: Business News Article type : News Item Classification : National : 94,448 Page: 23 Printed Size: cm² Market: National Country: Australia ASR: AUD 10,291 Words: 630 Item ID: Page 2 of 2 BRITTA CHAMPION James Shipton and, below, Wayne Byres at yesterday s Finsia meeting We are dealing with other people s money. We have to recognise that is the starting point of what we do. JAMES SHIPTON, ASIC

55 Adelaide Advertiser, Adelaide Section: Business News Article type : News Item Classification : Capital City Daily : 112,097 Page: 56 Printed Size: cm² Market: SA Country: Australia ASR: AUD 5,682 Words: 401 Item ID: Page 1 of 2 LONG ROAD BACK TO TRUST SAY BANK BOSSES THE heads of two of Australia s biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public s trust. The sentiments emerged while the bosses were being grilled by federal politicians at a parliamentary hearing in Canberra. Mr Comyn, who took up the top job at the Commonwealth Bank six months ago, said the bank had been too slow to fix customer service problems because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Westpac was also too slow to grapple with customer issues, particularly in its financial advice services area, Mr Hartzer said. We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay, he said. The leaders laid bare the steps the banks had taken to turn things around, with both stressing they had improved accountability by clarifying exactly what each of their senior executives were liable for. The leaders also noted the banks had changed incentives for those working at branches. Other reforms at the Commonwealth Bank have included strengthening lending processes and making it simpler for customers to choose products. Heads have rolled at the Commonwealth Bank over misconduct, Mr Cormyn revealed, with 41 people sacked so far this year and nine stepping down while being investigated. Mr Hartzer said improving the way Westpac deals with complaints had been central to its response, with a new group executive hired to oversee complaints handling. But neither chief executive is under any illusions about how long rebuilding trust will take. From an overall reputation point of view, this is obviously going to take years to restore, Mr Hartzer said. Mr Cormyn said his bank s recent changes are only the beginning. I accept that, and understand that you will judge me, and the Commonwealth Bank, on our actions.

56 Adelaide Advertiser, Adelaide Section: Business News Article type : News Item Classification : Capital City Daily : 112,097 Page: 56 Printed Size: cm² Market: SA Country: Australia ASR: AUD 5,682 Words: 401 Item ID: Page 2 of 2 TRUST ISSUES: Commonwealth Bank chief executive Matt Comyn said the bank had been too slow to fix customer service problems because it had become complacent. Picture: GARY RAMAGE

57 Adelaide Advertiser, Adelaide Section: Letters Article type : Letter Classification : Capital City Daily : 112,097 Page: 27 Printed Size: cm² Market: SA Country: Australia ASR: AUD 2,514 Words: 329 Item ID: Page 1 of 1 ONLINE What you are saying about... PM Scott Morrison wants to fast-track tax cuts for SA What is the Government doing to fix the recent disastrous ruling that effectively destroys casual employment as an option? This is an urgent matter that will have a huge and negative impact on small business flexibility, profitability and capacity to employ. ANGELA What he should be doing is taxing all of these companies that have taken themself offshore, as was promised by the former PM at the last federal election. ROBERT Giving business tax cuts based on the fact that you have enough revenue to give tax cuts is like quitting your job because you feel rich after your last pay cheque. And this is happening at the peak of the business cycle, when no stimulus is needed and a recession is more likely in the near term. PROTON gross turnover as well as normal tax. BRUCE The best way to help small business is to repeal the superannuation legislation. PAUL Taxes not linked to profit, like payroll tax, need to be scrapped. I ve run businesses for 16 years and in some years we lose money and still have to pay $60-70k in payroll tax. It disincentivises growth and employment. JASON WEBSITE: advertiser.com.au FACEBOOK: facebook.com/theadvertiser TWITTER: twitter.com/thetiser I m sure those 417,000 SA workers can t wait to be trickled upon. URANEEJIT If you really want to help businesses and the people of SA, you d sort out the stupid prices of electricity. The appalling SA Labor left SA with the highest prices on the planet. Perhaps pulling up a few stupid bird-shredding fans would help. JOHN Could someone please explain to these numpties that business tax cuts have never created increased wages or employment. Unless you stimulate demand for products or services, it simply goes into the owners pockets. Without increased demand, there is no incentive to produce more. This is high school economics and the PM doesn t get it. TRICKLEDOWN Would like to see a small percentage tax on

58 Adelaide Advertiser, Adelaide Author: Sophie Elsworth Section: General News Article type : News Item Classification : Capital City Daily : 112,097 Page: 19 Printed Size: cm² Market: SA Country: Australia ASR: AUD 2,276 Words: 266 Item ID: Page 1 of 1 $1.7m SA super gift unclaimed SOPHIE ELSWORTH AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And one South Australian has $1.7 million in superannuation just waiting in an Adelaide account. New figures from the financial year released by the Australian Taxation Office revealed there are 6.2 million accounts waiting to be reunited with owners. The average balance is $2933. And the largest amount yet to be claimed nationwide is a staggering balance of $2.2 million. People who have changed their jobs, moved house or forgotten to update their personal details are among those most likely to have retirement savings missing. In South Australia, $870 million in super is sitting idle in more than 160,000 accounts. The money waiting to be claimed is resting in lost or unclaimed super accounts. A lost super account is held by super funds where the fund has lost contact with the member and has not received a contribution for 12 months or more. A lost account becomes unclaimed and is sent to the ATO where the amount is less than $6000. Accounts also become unclaimed where individuals are eligible to withdraw but the super fund cannot contact them. The ATO s assistant commissioner Graham Whyte said Australians should check online to see if they had some of their own money that could be put in their hands. People have become disconnected and what we want to do is reconnect them, he said. The ATO has released postcode data that will allow Australians to check how much lost or unclaimed super is waiting to be claimed where they live.

59 Courier Mail, Brisbane Author: Sophie Moore Section: Business News Article type : News Item Classification : Capital City Daily : 135,007 Page: 30 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 16,720 Words: 483 Item ID: Page 1 of 2 BANKS TAKE HIT IN STORM SOPHIE MOORE BANK stocks were among the worst hit yesterday after a perfect storm on Wall Street caused a sea of red across global markets. The Big Four banks together lost more than $10 billion in value. The benchmark ASX200 index slid 166 points, or 2.74 per cent, to points. The slump carved almost $50 billion from the value of Australian shares. The worst performer among the top 50 shares was investment bank Macquarie which tumbled 6.04 per cent to $ Rakuten Securities Australia s chief operating officer Nick Twidale said the tumble on Wall Street, where the Dow Jones sank 3.15 per cent, triggering falls across the Asia Pacific region. China s Shanghai Composite dipped 5.22 per cent and Japan s Nikkei 3.89 per cent. He said US-China trade tensions, plus an IMF cut to growth forecasts and continuing strength in US bond yields had spooked investors. Whatever the tipping point, they all seemed to come together in an almost perfect storm, he said. Among the retail banking heavyweights, the worst performer was ANZ, its shares slumped 3.24 per cent to $ Commonwealth Bank shares tumbled 2.86 per cent lower to $67, while Westpac lost 2.56 per cent to $26.29 and NAB 2.55 per cent to $26. The slide coincided with Westpac and CBA chief executives appearing before federal parliamentary committee hearing yesterday. CBA chief executive Matt Comyn and Westpac chief executive Brian Hartzer acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. They also admitted the banks have their work cut out for them to regain the public s trust. Mr Comyn said the bank had been too slow to fix customer service problems because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Westpac was also too slow to grapple with customer issues, particularly in its financial advice services area, Mr Hartzer said. We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay. The leaders revealed the steps the banks have taken to turn things around, stressing they have improved accountability by clarifying exactly what each of their senior executives are liable for. The leaders also noted the banks have changed incentives for those working at branches. But neither chief executive is under any illusions about how long rebuilding trust will take. This is obviously going to take years to restore, Mr Hartzer said.

60 Courier Mail, Brisbane Author: Sophie Moore Section: Business News Article type : News Item Classification : Capital City Daily : 135,007 Page: 30 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 16,720 Words: 483 Item ID: Page 2 of 2 BANKS BASHED 3.24 % TO $ % TO $ % TO $ % TO $26 We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay WESTPAC CHIEF BRIAN HARTZER There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed CBA CHIEF MATT COMYN

61 Courier Mail, Brisbane Author: Sophie Elsworth Section: General News Article type : News Item Classification : Capital City Daily : 135,007 Page: 7 Printed Size: 76.00cm² Market: QLD Country: Australia ASR: AUD 1,335 Words: 181 Item ID: Page 1 of 1 Super high $17 billion unclaimed SOPHIE ELSWORTH AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And the largest amount yet to be claimed has a staggering balance of $2.2 million. Figures from the financial year, released by the Australian Taxation Office (ATO), reveal there are 6.2 million superannuation accounts waiting to be reunited with owners, with an average balance of $2933. People who have changed their jobs, moved house or forgotten to update their personal details are among those most likely to have retirement savings missing. In Queensland, $3 billion in super is sitting idle in more than 706,000 accounts. The largest amount is $1.1 million. ATO assistant commissioner, Graham Whyte, said Australians should check online to see if they have some of their own money that can be put in their hands. It s your money and you ve worked hard to earn it. It s your retirement savings and you will need it one day, he said. Accounts also become unclaimed when individuals are eligible to withdraw but the super fund cannot contact them to notify it s available.

62 The Australian, Australia Author: Benson Rosie Lewis Section: General News Article type : News Item Classification : National : 94,448 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 15,590 Words: 1127 Item ID: Page 1 of 2 HEAT ON LABOR OVER COMPANY TAX CUTS Shorten to shake up bank super EXCLUSIVE SIMON BENSON ROSIE LEWIS Bill Shorten has flagged giving financial regulators the power to force bank-owned retail superannuation funds to appoint independent trustees to ensure members interests are put ahead of profits when dealing with workers compulsory retirement savings. In a threatened regulatory shake-up of the profit-driven funds, the Opposition Leader will also consider giving the Australian Prudential and Regulatory Authority powers to sack trustees of habitually underperforming funds. Mr Shorten s comments to the Melbourne Institute/The Australian Economic and Social Outlook Conference dinner last night came after he was put under pressure by peak industry groups to Scott Morrison s move to accelerate company tax cuts for small and medium-sized businesses. The Opposition Leader left open the possibility of flipping on Labor s position for a second time in four months. Mr Shorten s comments on super reform follow a recent Productivity Commission report that found up to a third of all superannuation members were in continuously underperforming funds. Mr Shorten, a former assistant treasurer responsible for superannuation, argued that there was a conflict for banks running super funds in the interests of superannuation members and shareholders and their competing responsibilities. Bank-controlled for-profit superannuation funds have received criticism for underperforming not-for-profit industry funds in terms of returns to members, charging excessive fees and underpaying on cash rates. One idea that has emerged from some quarters is: should banks actually be in superannuation? Mr Shorten said last night. I don t know about that. One idea, and it s only an idea you could require for profit funds to outsource the trusteeship to genuinely independent organisations. Of course you would need the regulators to help you enforce that genuine independence. Mr Shorten said his biggest concern was with underperforming superannuation funds. His comments were initial thoughts and would need further examination. Scott Morrison yesterday warned that the plan to fast-track company tax cuts for small and medium businesses could be jeapordised by a defeat in next week s Wentworth by-election. You ll get then a hung parliament, and we re all in there negotiating with independents, Mr Morrison told Sky News. The small business tax relief Continued on Page 4

63 12 Oct 2018 The Australian, Australia Author: Benson Rosie Lewis Section: General News Article type : News Item Classification : National : 94,448 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 15,590 Words: 1127 Item ID: Page 2 of 2 Shorten to shake up bank super Continued from Page 1 that I ve announced today which I want to start legislating next week, all of these become uncertain. We add further uncertainty in our political environment. Labor s promised tax grabs would raise almost $160 billion over a decade and cover the funding of a faster rollout of a 25 per cent tax rate for businesses with a turnover of up to $50 million. Over the forward estimates the Opposition Leader s tax policies would raise $30.5bn, while the fast-tracked tax cuts announced by Mr Morrison yesterday are estimated to cost the budget $3.2bn over the same timeframe. Mr Shorten s wavering on Labor s company tax policy comes after he was forced by his shadow cabinet in June to down on a captain s call to repeal legislated tax cuts for businesses with turnovers of between $10m and $50m. Labor s current policy is to support the 27.5 per cent tax rate for companies with an annual turnover of up to $50m, but it would repeal the lower 25 per cent tax rate. Under the government s new plan, the legislated 25 per cent tax rate would be delivered in five years ahead of schedule. We will consider it if it can be afforded, Mr Shorten said. In a beauty parade between giving tax cuts to corporations, and funding education for kids, to funding our hospitals, making sure that the sick can afford to see a doctor, I am always going to pick our kids, and I m always going to pick the sick over corporate tax cuts. But if it is affordable, then we will look at doing both. But at this stage we want to crunch the numbers and I need to go through the proper processes consulting with my colleagues. Business groups were buoyed by Mr Shorten s initial response to the government s revised company tax cuts plan. Australian Chamber of Commerce and Industry chief executive James Pearson urged politicians who proclaimed support for small business to put their money where their mouth is. We would strongly urge Labor to the bring forward of the tax cuts for small, medium and family businesses, Mr Pearson said. The Labor Party has repeatedly said that it is a supporter of small business. There is no better way to demonstrate that right now than to the bring forward of the tax cuts which parliament has already legislated, that otherwise will not come into force or will not start coming into force for another three years. Mr Shorten last night denied his agenda was somehow about envy but stressed everyone needed to feel like they were getting a fair go, using Mr Morrison s catchphrase. Finance Minister Mathias Cormann said that if Mr Shorten cared about working families he would support the faster tax cuts for businesses that employed about seven million Australians. The government could legislate the quicker timetable without Labor s support but is one crossbench vote short of clinching the numbers to pass the bill through parliament. One Nation leader Pauline Hanson, who controls two votes in the Senate, said she would discuss her concerns about the government s plans with her colleague Peter Georgiou. I m more inclined to see the government make arrangements with the states to roll payroll taxes, which will offer businesses who employ staff genuine tax cuts and generate further employment across the nation, she said. Cory Bernardi, David Leyonhjelm, Brian Burston, Derryn Hinch, Fraser Anning and Centre Alliance senators Stirling Griff and Rex Patrick support a quicker rollout of the existing tax cuts. Indpendent senator Tim Storer has previously said he sees no evidence to introduce them sooner but said yesterday he would consider the legislation on its merits. REFORM FOR BUSINESS COALITION S COMPANY TAX POLICY 25 per cent tax rate for all businesses LABOR S COMPANY TAX POLICY 27.5 per cent tax rate for businesses turning over up to $50m WHEN COMPANY TAX CUTS ARRIVE UNDER EXISTING LAWS* Turnover up to $50m Turnover up to $2m : Rate reduced : to 27.5 per cent Rate reduced to : Rate reduced 28.5 per cent to 27 per cent Turnover up to $10m : Rate reduced to 27.5 per cent Turnover up to $25m : Rate reduced to 27.5 per cent : Rate reduced to 26 per cent Rate reduced to 25 per cent Cost of speeding up tax cut rollout $3.2 billion over the forward estimates *All other corporate entities have tax rate at 30 per cent TIMETABLE FOR FASTER ROLLOUT OF EXISTING TAX CUTS Turnover up to $50m Rate reduced to 26 per cent Rate reduced to 25 per cent Source ATO

64 Age, Melbourne Section: Editorials Article type : Editorial Classification : Capital City Daily : 83,229 Page: 18 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 13,259 Words: 587 Item ID: Page 1 of THE AGE Clouds gather over global economy The stock market has provided a timely reminder that the strong global economy which has buoyed Australia in recent years cannot last forever. The Australian market fell 2.74 per cent yesterday after even sharper declines on Wall Street. That could, of course, be a temporary blip and unless they check their superannuation balance every day, most Australians would probably not even notice. Yet, lower share prices will eventually undermine consumer sentiment, adding to the weight from falling house prices. That is not the only worrying news. The International Monetary Fund downgraded its forecasts for global economic growth in this financial year to 3.7 per cent, down from 3.9 per cent. That is still strong growth but the downgrade reflects serious problems in the global economy, especially the impact of US President Donald Trump s protectionist trade agenda. This is no longer just a matter of rhetoric. America has slapped high tariffs on imports of aluminium and steel and is locked in what looks like a longterm trade war with China in which both sides have slapped tariffs on hundreds of billions of dollars of trade. It is not clear how this will play out, and much depends on how the Chinese government responds, but if China suffers from this trade war and relations with the US deteriorate further, Australia won t avoid the consequences. The US economy for now is surging but that also raises risks. The US Federal Reserve is pushing up interest rates to prevent the economy overheating. Mr Trump says the Fed has gone crazy but the rate rises are the logical consequence of his huge, unfunded tax cuts, which are overheating the economy. Because the green is the world s reserve currency, high US interest rates have consequences all over the world, adding to financial crises in such countries as Argentina and Turkey. It doesn t help that the Trump administration s ban on exports from Iran is boostingglobal oil prices. Treasurer Josh Frydenberg, who is in Bali attending the IMF s annual meeting and then a meeting of G20 finance ministers, can help alleviate the risks by pushing for an end to the damaging trade wars. These problems should be solved by negotiation and the dispute settlement procedures of the World Trade Organisation, not by a destructive free-for-all. Australia can also show the way by pushing ahead with free-trade deals of its own. The other focus must be building what the IMF calls buffers to allow Australia to respond if global growth suddenly turns down. In the global financial crisis a decade ago, a strong budget position allowed then treasurer Wayne Swan to announce a stimulus package that protected Australia. Unfortunately, increasing the budget surplus rarely rates a mention in the debate on fiscal policy leading up to the next federal election. Both parties have just announced giveaways. Prime Minister Scott Morrison promised to bring forward a cut in the corporate tax for small business, which will cost $3.2 billion in the next four years and much more longer term. Labor leader Bill Shorten confirmed an extra $14 billion for public schools over the next decade. These are long-term promises, yet it is not clear they are matched by long-term growth in revenues. The IMF highlights Australia has gone from no debt to net debt of 20 per cent of gross domestic product since the GFC. That is still low by world standards, but Australia needs to reload its fiscal cannon so it can be fired in a crisis. Australia needs to reload its fiscal cannon.

65 Sydney Morning Herald, Sydney Section: Editorials Article type : Editorial Classification : Capital City Daily : 88,634 Page: 18 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 18,772 Words: 589 Item ID: Page 1 of 1 The Sydney Morning Herald Global economic sunshine can t last forever The stock market has provided a timely reminder that the strong global economy which has buoyed Australia in recent years cannot last forever. The Australian market fell 2.74 per cent yesterday after even sharper sharp declines on Wall Street. That could, of course, be a temporary blip and unless they check their superannuation balance every day most Australians would probably not even notice. Yet, lower share prices will eventually undermine consumer sentiment adding to the weight from falling house prices. That is not the only worrying news. The International Monetary Fund, the world s official forecaster, downgraded its forecasts for global economic growth in this financial year to 3.7 per cent, down from 3.9 per cent. That is still strong growth but the downgrade reflects serious problems in the global economy, especially the impact of US president Donald Trump s protectionist trade agenda. This is no longer just a matter of rhetoric. America has slapped high tariffs on imports of aluminium and steel and is now locked in what looks like a long-term trade war with China in which both sides have slapped tariffs on hundreds of billions of dollars of trade. It is not clear how this will play out and much depends on how the Chinese government responds but if China suffers from this trade war and relations with the US deteriorate further Australia won t avoid the consequences. The US economy for now is surging but that also raises risks. The US Federal Reserve is pushing up interest rates to prevent the economy overheating. Mr Trump says the Fed has gone crazy but the rate rises are the logical consequence of his huge, unfunded tax cuts which are overheating the economy. Because the green is the world s reserve currency, high US interest rates have consequences all over the world, contributing to the financial crises in countries such as Argentina and Turkey. It does not help that the Trump administration ban on exports from Iran is boosting global oil prices. Treasurer Josh Frydenberg, who is in Bali attending the IMF s annual meeting and then a meeting of G20 finance ministers, can help alleviate the risks by pushing for an end to the damaging trade wars. These problems should be solved by negotiation and the dispute settlement procedures of the World Trade Organisation, not by a destructive free-for-all. Australia can also show the way by pushing ahead with free-trade deals of its own. The other focus must be building what the IMF calls buffers to allow Australia to respond if global growth suddenly turns down. In the global financial crisis exactly a decade ago, a strong budget position allowed treasurer Wayne Swan to announce a stimulus package which protected Australia. Unfortunately, increasing the budget surplus rarely rates a mention in the debate on fiscal policy leading up to the next federal election. Both parties have just announced giveaways. Prime Minister Scott Morrison promised to bring forward a cut in the corporate tax for small business which will cost $3.2 billion in the next four years and much more longer term. ALP leader Bill Shorten confirmed an extra $14 billion for public schools over the next decade. These are long-term promises yet it is not clear that they are matched by long-term growth in revenues. The IMF highlights Australia has gone from no debt to net debt of 20 per cent of gross domestic product since the GFC. That is still low by world standards but Australia needs to reload its fiscal cannon so it can be fired in a crisis.

66 Age, Melbourne Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 38,210 Words: 638 Item ID: Page 1 of 2 I should have taken it further CBA CEO Matt Comyn faces the parliamentary hearing. Photo: Alex Ellinghausen Clancy Yeates Commonwealth Bank chief executive Matt Comyn has admitted that he should have done more to investigate the illegitimate setting up of children s bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. During a wide-ranging grilling that also focused on banker bonuses and CBA s charging of dead people, new details came to light about a previous scam in which Youthsaver bank accounts were activated by staff to game incentive systems. Mr Comyn was the first of the big four bank CEOs to appear before the government s parliamentary banking inquiry, the first detailed public questioning of the bankers since the royal commission s interim report was published two weeks ago. The Youthsaver issue, revealed by The Age in May, involved bank staff using their own money or bank funds to activate accounts that had been set up for school banking, sometimes known as Dollarmites. Depositing the cash meant the new account

67 Age, Melbourne Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 38,210 Words: 638 Item ID: Page 2 of 2 being opened would count towards the staff member s sales targets. Mr Comyn told a parliamentary hearing in Canberra yesterday that staff tampering of children s accounts came to his attention more than five years ago, and confirmed he was interviewed about the issue and disclosed it to the board before his appointment as CEO. Under questioning from Labor MP Matt Thistlethwaite, Mr Comyn said that in late 2012, he received a forwarded as an FYI that was sent to branch staff telling them the conduct was unacceptable. I did nothing to go further into the subsequent investigation, and if I had my time again I would have, Mr Comyn said. Yesterday, it also emerged that law firm MinterEllison was commissioned by CBA in 2016 to investigate the issue, after a whistleblower raised concerns. The law firm interviewed Mr Comyn over his handing of the issue as head of the retail bank, and Mr Comyn disclosed this to the board when he was applying to be the chief executive of CBA earlier this year. I took it upon myself to proactively raise with the board any issues that I considered needed to be brought to their attention. This was one of them, Mr Comyn said. CBA s chief risk officer David Cohen said he recalled the MinterEllison report had found the whistleblower s allegations were not well founded but he could not recall what the allegations were. The new information was revealed in a wide-ranging grilling, with Mr Comyn admitting CBA had suffered from leadership failings and instances of greed. As the royal commission has shown, there have unfortunately been failures of judgement, failures of process, failures of leadership, and in some instances, greed, he said in opening remarks. Under questioning from inquiry chairman Liberal MP Tim Wilson about the Hayne commission s report, Mr Comyn said that in hindsight, the bank should have acted differently in financial advice, which has been a key problem area for the bank and the industry. Amid calls for a shake-up in banker pay to reduce sales incentives for staff, Mr Comyn said his pay had a 30 per cent weighting to financial performance, half that of his predecessor and the lowest for a CBA chief executive in decades. Even so, he acknowledged there may be need for further changes in how bank staff are paid. He said CBA had dismissed 41 people for poor behaviour this year, and nine had resigned while investigations were under way. Labor MP Matt Keogh took issue with the bank s comment this week that moves to investigate the charging of fees for financial advice to dead customers were part of its response to the royal commission. Did you really need a royal commission to tell you that? Mr Keogh asked, prompting laughter. No, Mr Comyn replied.

68 Sydney Morning Herald, Sydney Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 88,634 Page: 11 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 29,250 Words: 637 Item ID: Page 1 of 2 BANKING Comyn admits Dollarmites failure Clancy Yeates Commonwealth Bank chief executive Matt Comyn has admitted he should have done more to investigate the illegitimate setting up of children s bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. During a wide-ranging grilling that also focused on banker bonuses and CBA s charging of dead people, new details came to light about a previous scam in which Youthsaver bank accounts were activated by staff to game incentive systems. Mr Comyn was the first of the big four bank CEOs to appear before the government s ongoing parliamentary banking inquiry, the first detailed public questioning of the bankers since the royal commission s interim report was published two weeks ago. The Youthsaver issue, revealed by the Herald in May, involved bank staff using their own money or bank funds to activate accounts that had been set up for school banking, sometimes known as Dollarmites. Depositing the cash meant the new account being opened would count towards the staff member s sales targets. Mr Comyn told a parliamentary hearing in Canberra yesterday that staff tampering of children s accounts came to his attention more than five years ago, and confirmed he was subsequently interviewed about the issue and disclosed it to the board before his appointment as CEO. Under questioning from Labor MP Matt Thistlethwaite, Mr Comyn said that in late 2012, he received a forwarded as an FYI that was sent to branch staff telling them the conduct was unacceptable, but did not take further action at the time. I did nothing to go further into the subsequent investigation, and if I had my time again I would have, Mr Comyn said. CBA has previously said the conduct was inappropriate and was a breach of customer trust. Yesterday, it also emerged that law firm MinterEllison was commissioned by CBA in 2016 to investigate the issue, after a whistleblower raised concerns. The law firm interviewed Mr Comyn over his handling of the issue as head of the retail bank, and Mr Comyn disclosed this to the board when he was applying to be the CEO of CBA this year. As it relates to my appointment, just so there can be no misunderstanding, as you would appreciate during an interview process for a role such as the chief executive, I took it upon myself to proactively raise with the board any issues that I considered needed to be brought to their attention. This was one of them, Mr Comyn said. CBA s chief risk officer, David Cohen, said he recalled the MinterEllison report had found the whistleblower s allegations were not well founded but he could not recall what the exact allegations were. Mr Thistlethwaite suggested the time it took CBA to investigate the tampering with children s bank accounts reflected a complacency within the country s biggest bank, which has suffered a string of scandals in recent years. Mr Comyn suggested to Mr Thistlethwaite that the matter was far more extensive than what he had been told, but there were legal restrictions on what he could say about whistleblower cases. The new information was revealed in a wide-ranging grilling, with Mr Comyn admitting CBA had become complacent, and suffered from leadership failings and instances of greed. Under questioning from inquiry chairman Liberal MP Tim Wilson about the Hayne commission s report, Mr Comyn said that in hindsight, the bank should have acted differently in financial advice, which has been a key problem area for the bank and the industry. Mr Comyn, who took over from Ian Narev this year, also said the bank now recognised it should not have opposed a royal commission into the banking industry.

69 Sydney Morning Herald, Sydney Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 88,634 Page: 11 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 29,250 Words: 637 Item ID: Page 2 of 2 Regrets: Matt Comyn says if he had the time again he would do more to investigate the setting up of accounts. Photo: Alex Ellinghausen

70 Sydney Morning Herald, Sydney Author: Melanie Beeby Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 22 Printed Size: 41.00cm² Market: NSW Country: Australia ASR: AUD 2,983 Words: 94 Item ID: Page 1 of 1 Celebrity planner breached code The Financial Planning Association of Australia s (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson s over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards, FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn t been made. Melanie Beeby

71 Sydney Morning Herald, Sydney Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 22 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 56,535 Words: 637 Item ID: Page 1 of 3 Westpac mulled passing levy onto customers, staff BANKS Sarah Danckert Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. A report from the Australian Competition and Consumer Commission in March singled out an unnamed big four bank over its plans to only make shareholders pay for the cost of the levy during the ACCC s review and then later shift to passing on the costs to its customers and suppliers. Some of the big banks had also considered passing on the cost to staff. The ACCC was commissioned to conduct an inquiry into mortgage pricing after the bank levy was incorporated into the 2017 federal budget. The major bank levy is a 0.06 percentage point charge on banks liabilities, applying to Commonwealth Bank, National Australia Bank, Westpac, ANZ Bank and Macquarie Group. The government expects the levy to raise $6.2 billion over four years. Westpac estimated in May 2017 the cost of the levy to the bank would be $370 million per year. In August, Westpac was the first bank to say it would raise interest rates for mortgage holders independently of the Reserve Bank. The ACCC report states: [An] inquiry bank considered that shareholders could initially bear the cost of the major bank levy, followed by customers and suppliers beginning to bear the cost of the major bank levy later, including at a time that is after the conclusion of the ACCC s inquiry. Mr Hartzer was taken to the extract of the report by Labor MP Matt Keogh, who then asked: Was that bank your bank? Mr Hartzer said he suspected it was Westpac that was the unnamed bank in the report. When the bank levy came in, it was a very significant increase in costs, understandably our product teams looked at options about how to deal with that extra cost. That would have been an option that may have been put in a paper, it was not an option I have considered. We have not sought to recover the cost from customers nor do we have any intent to do so at any time, Mr Hartzer said. When asked if Westpac had considered passing on the cost to staff, Mr Hartzer said: We would have looked at it. Westpac reported a 6 per cent lift in first half cash earnings to $4.25 billion in May. Mr Hartzer, who apologised over the misconduct at Westpac revealed by the banking royal commission, also warned policymakers to be careful when responding to recommendations from the royal commission. Regulatory changes that impact how much individuals can borrow, the cost and availability of credit for business, or the availability and affordability of suitable financial advice should be considered carefully, he said. The Westpac boss was quizzed by Liberal MP and committee chairman Tim Wilson over Mr Hartzer s view that regulation should be simplified, saying most Australians would be concerned it could mean deregulation. How would you say you get better outcomes from simplification of regulation for people who are in vulnerable situations, when ultimately it is actually about taking their complaints seriously rather than find ways to extend, delay or use the power/information imbalance against their interests? Mr Wilson asked. Mr Hartzer responded: When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach.

72 Sydney Morning Herald, Sydney Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 22 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 56,535 Words: 637 Item ID: Page 2 of 3 When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach. Brian Hartzer, Westpac CEO

73 Sydney Morning Herald, Sydney Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 22 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 56,535 Words: 637 Item ID: Page 3 of 3 Westpac CEO Brian Hartzer. Photo: AAP

74 Sydney Morning Herald, Sydney Author: Stephen Bartholomeusz Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 23 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 41,910 Words: 924 Item ID: Page 1 of 3 An ominous sign as Wall Street s FANGs are bitten COMMENT Stephen Bartholomeusz That shudder that roiled the US sharemarket may not be the end of the near decade-long bull market but it might well signal the beginning of the end. A 3.3 per cent fall in the market isn t a crash but it still represents an unusual and disconcerting event. Within that overall fall, the 4 per cent decline in the technologyheavy Nasdaq market was particularly ominous, given that it was the big technology stocks like Amazon, Facebook, Netflix and Google that had powered the market to record levels last month. There are a number of influences that help explain why the market fell and might subside further, not the least of which is that the fundamentals are shifting. The long bull market in shares coincided with an even longer bull market in bonds, one fuelled in the past decade by the unprecedented actions of central banks in response to the financial crisis. As interest rates were lowered to negligible levels and the US Federal Reserve and its counterparts in Europe and Japan bought about $US11 trillion of Continued Page 27 Wall Street FANGs are bitten From Page 22 bonds and other fixed interest rate securities, they injected massive amounts of ultra-cheap liquidity into the global financial system and essentially forced investors to take increasing risks for decreasing returns. With the Fed now shrinking its balance sheet at a rate of $US50 billion a month, the European Central Bank and Bank of Japan contemplating the winding of their own measures and US rates rising the Fed last month raised rates for the eighth time since late 2015 the big picture is changing shape. Conventionally, when bond yields rise significantly, share prices fall. That hadn t been happening because rates were so low and the lack of return from bond markets gave investors no option but to keep ploughing funds into equities. Trumpenomics the big tax cuts for US companies and wealthy individuals and big increase in government spending have turbocharged what was a solid US economic recovery. With US GDP growth running at an annualised rate above 4 per cent, corporate profits and share prices have also boomed. Given the pro-cyclical nature of the Trump administration s stimulus, it s not surprising that the tone of the Fed s commentary has recently become much more hawkish, challenging the market s complacency. The trade conflict with China isn t helping. It is, as the International Monetary Fund said this week, a threat to global growth. It could, because it will increase the cost of raw materials and disrupt supply chains, impact US corporate profits. The trade confrontation has a particular relevance for US technology stocks, whose complex supply chains are rooted within China. The FANG+ index (Facebook, Amazon, Nextflix and Google make up the FANG ) of big technology stocks has fallen 18 per cent since June 12 per cent since the start of this month as the tensions have escalated and the magnitude and breadth of the tariffs exchanges have swollen. Amazon, which topped $US1 trillion of market value last month, has since lost about $US150 billion of market capitalisation. It was down 6.2 per cent on Wednesday. Google s parent, Alphabet, was down 4.6 per cent, as was Apple. Netflix was down 8.4 per cent. The tech stocks point to the threat to the market posed by the rise in bond yields as term premia the compensation bond investors want for the risk of holding longerdated securities start to reemerge after a near-decade of hibernation. The big technology stocks trade on price-earnings ratios of 60, 70, 80 times earnings. They are priced for perfection. The overall US market trades on a multiple of about 20 times earnings, well above historical norms. (Our market, without a big tech sector, trades at about 16 times earnings). If share prices ought to reflect the net present value of a company s future cash flows, then the increase in US bond rates should to see those future cash flows discounted at a higher rate, both because the risk-free rate

75 Sydney Morning Herald, Sydney Author: Stephen Bartholomeusz Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 23 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 41,910 Words: 924 Item ID: Page 2 of 3 (the yield on 10-year US government debt) is rising but also because the normalising of US monetary policy ought to also result in the re-emergence of risk premia. If the US stockmarket was inflated (along with bond and property markets around the world) by the policies the key central banks have left in place for nearly a decade, then the unwinding of those policies ought to result in its deflation, or even implosion. Some investors obviously came to that conclusion earlier than others. Since the start of this year, the flow of cash into mutual and exchanged-traded funds has, according to Morningstar, nearly halved relative to the same period last year. Something similar has been occurring in bond markets, where the rise in yields has seen a major sell-off. On Wednesday, as the stockmarket fell, bond yields edged down. Money fleeing equities didn t head for the traditional safe-haven, which means nervous, risk-averse investors are parking it in cash. What s happening in the US shouldn t directly impact our markets, but it will. Rising US rates will pull our rates up with them and impact our equities, despite the Reserve Bank holding the cash rate at historically low levels. More broadly, the defensive, even fearful, sentiment emerging as this US administration continues to undermine longstanding global relationships, agreements and conventions isn t confined to some quarters of the US. It is contagious and global and we re not immune to it. The Fed last month raised rates for the eighth time since late 2015.

76 Sydney Morning Herald, Sydney Author: Stephen Bartholomeusz Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 23 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 41,910 Words: 924 Item ID: Page 3 of 3 American nightmare Wall Street s Nasdaq and S&P500 showed early signs of panic as the relentless bull market run faltered. 4% Comparative results 2% S&P 500 0% -2% -4% Nasdaq -6% September 1 October 1 October 10 SOURCE: BLOOMBERG

77 Sydney Morning Herald, Sydney Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 23 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 16,371 Words: 471 Item ID: Page 1 of 1 Watchdog concedes it may need to crack down more BANKING Sarah Danckert The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. The lack of oversight of the sector was highlighted during the August hearings of the banking royal commission, leading counsel assisting Michael Hodge, QC, to ask: What happens when we leave these trustees alone in the dark with our money? APRA deputy chair Helen Rowell was taken to task during the commission s superannuation hearings when she admitted the regulator had taken legal action only once in the past 10 years. An interim report by the royal commission covering the first four rounds of hearings did not cover the regulation of the superannuation sector, as those issues were raised in the fifth round of hearings. Commissioner Kenneth Hayne is expected to include his findings on superannuation and insurance in his final report due in February. Much of the conduct in the financial services sector is the responsibility of the Australian Securities and Investments Commission (ASIC) but neither ASIC nor APRA cover conduct in the superannuation sector due to a lack of specific laws clearly giving either the power to do so. Mr Byres told a conference in Sydney that APRA had been reflecting on the conduct issues raised during the royal commission. The royal commission has suggested, amongst other things, that regulators can and should do more to actively enforce standards of behaviour within the financial sector, and punish those who breach them, Mr Byres said. Based on what has been revealed, that is a quite reasonable conclusion. APRA had been focused on its stability remit rather than misconduct, Mr Byres said, adding that approach might need to change. Consistent with prudential supervisors around the world, APRA has traditionally examined cases of poor conduct as an indicator of risk, but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of the system or an individual institution, he said. We will clearly need to reflect on that approach. Mr Byres pointed to regulatory changes already in APRA s pipeline, including the Banking Executive Accountability Regime, which gives APRA oversight of banker pay. Accountability statements, remuneration restrictions, strengthened governance requirements, greater attention to organisational culture, and more forceful enforcement will drive change, Mr Byres said. He added that regulators could not alone regulate cultural change. Regulators can play their part but cannot regulate a good culture into existence, he said. 1HERSA1 A023 Wayne Byres says APRA is reflecting on its approach to poor conduct.

78 Sydney Morning Herald, Sydney Section: Business News Article type : News Item Classification : Capital City Daily : 88,634 Page: 23 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 7,931 Words: 302 Item ID: Page 1 of 1 Dishonesty must stop, says ASIC s Shipton James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission s interim report into misconduct in the financial services industry and that is dishonesty. That word dishonest... that is the diagnosis on our industry it is a blight, he told a finance industry conference in Sydney yesterday. We all need to have a single aim and that is... a fair, strong and efficient financial services sector for all Australians. If we embrace the concept [that the industry manages] other people s money, then hopefully we can get away from this horrible diagnosis of dishonesty to a diagnosis of professionalism. He did not address the criticisms made in the interim report released last month by Commissioner Kenneth Hayne, in which much of the blame was directed at ASIC and the Australian Prudential Regulation Authority (APRA) for being too close to the banks and not taking them to court. Treasurer Josh Frydenberg said even before the release of the interim report that both regulators had a case to answer over scandals exposed by the royal commission. Mr Shipton, who started as ASIC chairman in February, told the conference that we have to reclaim that first line responsibility of ensuring that we have fair, efficient and honest conduct in our industry that is an obligation on you [under the law]. Regulation cannot be the sole solution, it has to be coming from the industry itself, he said. It was the responsibility of all of the 450,000 people who worked in the financial services industry to rebuild trust with the community, he said. As much we want to be everywhere, as much as we want to right every wrong, we can t be everywhere all the time, he said. John Collett

79 Daily Mercury, Mackay QLD Section: General News Article type : News Item Classification : Regional : 7,738 Page: 29 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 263 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

80 News Mail, Bundaberg QLD Section: General News Article type : News Item Classification : Regional : 6,176 Page: 28 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 229 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

81 Queensland Times, Ipswich QLD Section: General News Article type : News Item Classification : Regional : 6,256 Page: 24 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 229 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

82 Gympie Times, Gympie QLD Section: General News Article type : News Item Classification : Regional : 2,997 Page: 20 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 193 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

83 Age, Melbourne Author: Melanie Beeby Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 22 Printed Size: 41.00cm² Market: VIC Country: Australia ASR: AUD 2,294 Words: 94 Item ID: Page 1 of 1 Celebrity planner breached code The Financial Planning Association of Australia s (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson s over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards, FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn t been made. Melanie Beeby

84 Age, Melbourne Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 22 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 43,692 Words: 637 Item ID: Page 1 of 2 Westpac mulled passing levy onto customers, staff BANKS Sarah Danckert Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. A report from the Australian Competition and Consumer Commission in March singled out an unnamed big four bank over its plans to only make shareholders pay for the cost of the levy during the ACCC s review and then later shift to passing on the costs to its customers and suppliers. Some of the big banks had also considered passing on the cost to staff. The ACCC was commissioned to conduct an inquiry into mortgage pricing after the bank levy was incorporated into the 2017 federal budget. The major bank levy is a 0.06 percentage point charge on banks liabilities, applying to Commonwealth Bank, National Australia Bank, Westpac, ANZ Bank and Macquarie Group. The government expects the levy to raise $6.2 billion over four years. Westpac estimated in May 2017 the cost of the levy to the bank would be $370 million per year. In August, Westpac was the first bank to say it would raise interest rates for mortgage holders independently of the Reserve Bank. The ACCC report states: [An] inquiry bank considered that shareholders could initially bear the cost of the major bank levy, followed by customers and suppliers beginning to bear the cost of the major bank levy later, including at a time that is after the conclusion of the ACCC s inquiry. Mr Hartzer was taken to the extract of the report by Labor MP Matt Keogh, who then asked: Was that bank your bank? Mr Hartzer said he suspected it was Westpac that was the unnamed bank in the report. When the bank levy came in, it was a very significant increase in costs, understandably our product teams looked at options about how to deal with that extra cost. That would have been an option that may have been put in a paper, it was not an option I have considered. We have not sought to recover the cost from customers nor do we have any intent to do so at any time, Mr Hartzer said. When asked if Westpac had considered passing on the cost to staff, Mr Hartzer said: We would have looked at it. Westpac reported a 6 per cent lift in first half cash earnings to $4.25 billion in May. Mr Hartzer, who apologised over the misconduct at Westpac revealed by the banking royal commission, also warned policymakers to be careful when responding to recommendations from the royal commission. Regulatory changes that impact how much individuals can borrow, the cost and availability of credit for business, or the availability and affordability of suitable financial advice should be considered carefully, he said. The Westpac boss was quizzed by Liberal MP and committee chairman Tim Wilson over Mr Hartzer s view that regulation should be simplified, saying most Australians would be concerned it could mean deregulation. How would you say you get better outcomes from simplification of regulation for people who are in vulnerable situations, when ultimately it is actually about taking their complaints seriously rather than find ways to extend, delay or use the power/information imbalance against their interests? Mr Wilson asked. Mr Hartzer responded: When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach.

85 Age, Melbourne Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 22 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 43,692 Words: 637 Item ID: Page 2 of 2 When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach. Brian Hartzer, Westpac CEO Westpac CEO Brian Hartzer. Photo: AAP

86 Age, Melbourne Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 23 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 12,755 Words: 471 Item ID: Page 1 of 1 Watchdog concedes it may need to crack down more BANKING Sarah Danckert The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. The lack of oversight of the sector was highlighted during the August hearings of the banking royal commission, leading counsel assisting Michael Hodge, QC, to ask: What happens when we leave these trustees alone in the dark with our money? APRA deputy chair Helen Rowell was taken to task during the commission s superannuation hearings when she admitted the regulator had taken legal action only once in the past 10 years. An interim report by the royal commission covering the first four rounds of hearings did not cover the regulation of the superannuation sector, as those issues were raised in the fifth round of hearings. Commissioner Kenneth Hayne is expected to include his findings on superannuation and insurance in his final report due in February. Much of the conduct in the financial services sector is the responsibility of the Australian Securities and Investments Commission (ASIC) but neither ASIC nor APRA cover conduct in the superannuation sector due to a lack of specific laws clearly giving either the power to do so. Mr Byres told a conference in Sydney that APRA had been reflecting on the conduct issues raised during the royal commission. The royal commission has suggested, amongst other things, that regulators can and should do more to actively enforce standards of behaviour within the financial sector, and punish those who breach them, Mr Byres said. Based on what has been revealed, that is a quite reasonable conclusion. APRA had been focused on its stability remit rather than misconduct, Mr Byres said, adding that approach might need to change. Consistent with prudential supervisors around the world, APRA has traditionally examined cases of poor conduct as an indicator of risk, but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of the system or an individual institution, he said. We will clearly need to reflect on that approach. Mr Byres pointed to regulatory changes already in APRA s pipeline, including the Banking Executive Accountability Regime, which gives APRA oversight of banker pay. Accountability statements, remuneration restrictions, strengthened governance requirements, greater attention to organisational culture, and more forceful enforcement will drive change, Mr Byres said. He added that regulators could not alone regulate cultural change. Regulators can play their part but cannot regulate a good culture into existence, he said. NATAGE A023 Wayne Byres says APRA is reflecting on its approach to poor conduct.

87 Age, Melbourne Author: John Collett Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 23 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 6,098 Words: 300 Item ID: Page 1 of 1 Dishonesty must stop, says ASIC s Shipton James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission s interim report into misconduct in the financial services industry and that is dishonesty. That word dishonest... that is the diagnosis on our industry it is a blight, he told a finance industry conference in Sydney yesterday. We all need to have a single aim and that is... a fair, strong and efficient financial services sector for all Australians. If we embrace the concept [that the industry manages] other people s money, then hopefully we can get away from this horrible diagnosis of dishonesty to a diagnosis of professionalism. He did not address the criticisms made in the interim report released last month by Commissioner Kenneth Hayne, in which much of the blame was directed at ASIC and the Australian Prudential Regulation Authority (APRA) for being too close to the banks and not taking them to court. Treasurer Josh Frydenberg said even before the release of the interim report that both regulators had a case to answer over scandals exposed by the royal commission. Mr Shipton, who started as ASIC chairman in February, told the conference that we have to reclaim that first line responsibility of ensuring that we have fair, efficient and honest conduct in our industry that is an obligation on you [under the law]. Regulation cannot be the sole solution, it has to be coming from the industry itself, he said. It was the responsibility of all of the 450,000 people who worked in the financial services industry to rebuild trust with the community, he said. As much we want to be everywhere, as much as we want to right every wrong, we can t be everywhere all the time, he said. John Collett

88 Gladstone Observer, Gladstone QLD Author: Greg Bray Section: General News Article type : News Item Classification : Regional : 3,301 Page: 14 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 143 Words: 379 Item ID: Page 1 of 1 Before search engines we visited pubs WRITIN RETURN GREG BRAY FOLKS, it wasn t so long ago that Gladstone s pubs were what us old people used before internet search engines. Before social media, if you were looking for a job, a tradie, pet, some dodgy retail goods, a shoulder to cry on, cheap seafood or true love, the first place you d go was your favourite watering hole. Pubs were also the place to pick up the latest local news or gossip. I became a reporter in order to hang out in pubs listening for stories. As it turns out, I was grossly misinformed about where we actually sourced our news from. I BECAME A REPORTER IN ORDER TO HANG OUT IN PUBS LISTENING FOR STORIES. GREG BRAY Here s a newsflash: it s not at the pub. Trust me. Anyway, over the years I ve met plenty of people who pulled into town during the 1970s for a quick drink or a bite to eat and nearly 50 years later, they re still here. One mate was on his way to Cairns and was offered a job before he d finished his first beer. He s been a local ever since. He finally flew to Cairns three years ago, for a holiday. My dearly departed banking mate Al Cummins often told me most of the loans he approved in the day were done over bar counters. We d agree on a figure, finish our drinks then go to the bank to sign the paperwork, he said. The publican would even give us a jug of beer to take to the office. Oddly, there was no need for Royal Commissions into dodgy financial dealings then. Just saying. Finally, the pub was also the place to go if you wanted advice or help with a personal problem. My uncle claimed regular visits to the RSL helped him deal with his issues after the war. Like most men of his generation, he preferred to share his personal anxieties with a group of unqualified, boozy layabouts rather than visit a professional counsellor. Still, if you re paying for the beer you ll always find someone prepared to pretend listen to your woes. For various reasons, we don t visit the pub to socialise any more. Perhaps someone s developed a pub app? I ll ask next time I m at the pub.

89 Gladstone Observer, Gladstone QLD Section: General News Article type : News Item Classification : Regional : 3,301 Page: 25 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 228 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

90 Border Mail, Albury-Wodonga Section: General News Article type : News Item Classification : Regional : 13,519 Page: 12 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 1,284 Words: 281 Item ID: Page 1 of 2 Banks long road THE heads of two of Australia s biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public s trust. The sentiments emerged while the bosses were being grilled by federal politicians at a parliamentary hearing in Canberra. Mr Comyn, who took up the top job at the Commonwealth Bank six months ago, said the bank had been too slow to fix customer service problems because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Westpac was also too slow to grapple with customer issues, particularly in its financial advice services area, Mr Hartzer said. We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay, he said. The leaders laid bare the steps the banks have taken to turn things around, with both stressing they have improved accountability by clarifying exactly what each of their senior executives are liable for. The leaders also noted the banks have changed incentives for those working at branches. Heads have rolled at the Commonwealth Bank over misconduct, Mr Cormyn revealed, with 41 people sacked so far this year and nine stepping down while being investigated.

91 Border Mail, Albury-Wodonga Section: General News Article type : News Item Classification : Regional : 13,519 Page: 12 Printed Size: cm² Market: NSW Country: Australia ASR: AUD 1,284 Words: 281 Item ID: Page 2 of 2 SORRY: Commonwealth Bank CEO Matt Comyn speaks at the House Economics Committee in Canberra. Picture: AAP

92 Warrnambool Standard, Warrnambool VIC Section: General News Article type : News Item Classification : Regional : 8,274 Page: 12 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 1,364 Words: 281 Item ID: Page 1 of 2 Banks long road THE heads of two of Australia s biggest banks have acknowledged the institutions took too long to address misconduct that was eventually uncovered by a royal commission. Commonwealth Bank chief executive Matt Comyn and Westpac chief executive Brian Hartzer have also admitted the banks have their work cut out for them to regain the public s trust. The sentiments emerged while the bosses were being grilled by federal politicians at a parliamentary hearing in Canberra. Mr Comyn, who took up the top job at the Commonwealth Bank six months ago, said the bank had been too slow to fix customer service problems because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Westpac was also too slow to grapple with customer issues, particularly in its financial advice services area, Mr Hartzer said. We weren t quick enough to identify and fix the problems, and we accept the consequences of this delay, he said. The leaders laid bare the steps the banks have taken to turn things around, with both stressing they have improved accountability by clarifying exactly what each of their senior executives are liable for. The leaders also noted the banks have changed incentives for those working at branches. Heads have rolled at the Commonwealth Bank over misconduct, Mr Cormyn revealed, with 41 people sacked so far this year and nine stepping down while being investigated.

93 Warrnambool Standard, Warrnambool VIC Section: General News Article type : News Item Classification : Regional : 8,274 Page: 12 Printed Size: cm² Market: VIC Country: Australia ASR: AUD 1,364 Words: 281 Item ID: Page 2 of 2 SORRY: Commonwealth Bank CEO Matt Comyn speaks at the House Economics Committee in Canberra. Picture: AAP

94 Canberra Times, Canberra Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 36 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 20,414 Words: 637 Item ID: Page 1 of 3 Westpac mulled passing levy onto customers, staff BANKS Sarah Danckert Westpac boss Brian Hartzer has admitted his bank was the unnamed financial institution singled out by the competition regulator in a report over its plans to pass the full cost of a new major bank levy onto customers instead of shareholders. Mr Hartzer also admitted during questioning at a parliamentary committee yesterday that Westpac considered passing on the cost of the multibillion-dollar levy to bank staff. A report from the Australian Competition and Consumer Commission in March singled out an unnamed big four bank over its plans to only make shareholders pay for the cost of the levy during the ACCC s review and then later shift to passing on the costs to its customers and suppliers. Some of the big banks had also considered passing on the cost to staff. The ACCC was commissioned to conduct an inquiry into mortgage pricing after the bank levy was incorporated into the 2017 federal budget. The major bank levy is a 0.06 percentage point charge on banks liabilities, applying to Commonwealth Bank, National Australia Bank, Westpac, ANZ Bank and Macquarie Group. The government expects the levy to raise $6.2 billion over four years. Westpac estimated in May 2017 the cost of the levy to the bank would be $370 million per year. In August, Westpac was the first bank to say it would raise interest rates for mortgage holders independently of the Reserve Bank. The ACCC report states: [An] inquiry bank considered that shareholders could initially bear the cost of the major bank levy, followed by customers and suppliers beginning to bear the cost of the major bank levy later, including at a time that is after the conclusion of the ACCC s inquiry. Mr Hartzer was taken to the extract of the report by Labor MP Matt Keogh, who then asked: Was that bank your bank? Mr Hartzer said he suspected it was Westpac that was the unnamed bank in the report. When the bank levy came in, it was a very significant increase in costs, understandably our product teams looked at options about how to deal with that extra cost. That would have been an option that may have been put in a paper, it was not an option I have considered. We have not sought to recover the cost from customers nor do we have any intent to do so at any time, Mr Hartzer said. When asked if Westpac had considered passing on the cost to staff, Mr Hartzer said: We would have looked at it. Westpac reported a 6 per cent lift in first half cash earnings to $4.25 billion in May. Mr Hartzer, who apologised over the misconduct at Westpac revealed by the banking royal commission, also warned policymakers to be careful when responding to recommendations from the royal commission. Regulatory changes that impact how much individuals can borrow, the cost and availability of credit for business, or the availability and affordability of suitable financial advice should be considered carefully, he said. The Westpac boss was quizzed by Liberal MP and committee chairman Tim Wilson over Mr Hartzer s view that regulation should be simplified, saying most Australians would be concerned it could mean deregulation. How would you say you get better outcomes from simplification of regulation for people who are in vulnerable situations, when ultimately it is actually about taking their complaints seriously rather than find ways to extend, delay or use the power/information imbalance against their interests? Mr Wilson asked. Mr Hartzer responded: When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach.

95 Canberra Times, Canberra Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 36 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 20,414 Words: 637 Item ID: Page 2 of 3 When you have an enormous list of specific things that you have to do it can lead you down the path of a tick-the-box approach. Brian Hartzer, Westpac CEO

96 Canberra Times, Canberra Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 36 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 20,414 Words: 637 Item ID: Page 3 of 3 Westpac CEO Brian Hartzer. Photo: AAP

97 Canberra Times, Canberra Author: Melanie Beeby Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 36 Printed Size: 41.00cm² Market: ACT Country: Australia ASR: AUD 1,050 Words: 94 Item ID: Page 1 of 1 Celebrity planner breached code The Financial Planning Association of Australia s (FPA) independent disciplinary body has found celebrity planner Sam Henderson breached its code of practice. The review arose from a complaint by a client of Mr Henderson s over a statement of advice prepared in The FPA found nine of the 10 alleged breaches of the code were proven. FPA members are required to uphold the highest ethical standards within the financial planning profession. Mr Henderson failed to meet those standards, FPA chief executive Dante De Gori said. A decision on costs or sanctions hasn t been made. Melanie Beeby

98 Canberra Times, Canberra Author: Sarah Danckert Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 37 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 5,865 Words: 471 Item ID: Page 1 of 1 Watchdog concedes it may need to crack down more BANKING Sarah Danckert The litany of misconduct revealed at the banking royal commission has prompted the head of the superannuation and banking regulator to concede it might need to do more to crack down on poor behaviour in the sector. Australian Prudential Regulation Authority (APRA) chairman Wayne Byres yesterday said the regulator needed to reflect on its current approach to regulation following revelations at the royal commission that conduct in the superannuation sector was largely unregulated. The lack of oversight of the sector was highlighted during the August hearings of the banking royal commission, leading counsel assisting Michael Hodge, QC, to ask: What happens when we leave these trustees alone in the dark with our money? APRA deputy chair Helen Rowell was taken to task during the commission s superannuation hearings when she admitted the regulator had taken legal action only once in the past 10 years. An interim report by the royal commission covering the first four rounds of hearings did not cover the regulation of the superannuation sector, as those issues were raised in the fifth round of hearings. Commissioner Kenneth Hayne is expected to include his findings on superannuation and insurance in his final report due in February. Much of the conduct in the financial services sector is the responsibility of the Australian Securities and Investments Commission (ASIC) but neither ASIC nor APRA cover conduct in the superannuation sector due to a lack of specific laws clearly giving either the power to do so. Mr Byres told a conference in Sydney that APRA had been reflecting on the conduct issues raised during the royal commission. The royal commission has suggested, amongst other things, that regulators can and should do more to actively enforce standards of behaviour within the financial sector, and punish those who breach them, Mr Byres said. Based on what has been revealed, that is a quite reasonable conclusion. APRA had been focused on its stability remit rather than misconduct, Mr Byres said, adding that approach might need to change. Consistent with prudential supervisors around the world, APRA has traditionally examined cases of poor conduct as an indicator of risk, but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of the system or an individual institution, he said. We will clearly need to reflect on that approach. Mr Byres pointed to regulatory changes already in APRA s pipeline, including the Banking Executive Accountability Regime, which gives APRA oversight of banker pay. Accountability statements, remuneration restrictions, strengthened governance requirements, greater attention to organisational culture, and more forceful enforcement will drive change, Mr Byres said. He added that regulators could not alone regulate cultural change. Regulators can play their part but cannot regulate a good culture into existence, he said. Wayne Byres says APRA is reflecting on its approach to poor conduct.

99 Canberra Times, Canberra Author: John Collett Section: Business News Article type : News Item Classification : Capital City Daily : 17,579 Page: 37 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 2,817 Words: 300 Item ID: Page 1 of 1 Dishonesty must stop, says ASIC s Shipton James Shipton, chairman of the Australian Securities and Investments Commission (ASIC), says there is one word that recurs in the Hayne royal commission s interim report into misconduct in the financial services industry and that is dishonesty. That word dishonest... that is the diagnosis on our industry it is a blight, he told a finance industry conference in Sydney yesterday. We all need to have a single aim and that is... a fair, strong and efficient financial services sector for all Australians. If we embrace the concept [that the industry manages] other people s money, then hopefully we can get away from this horrible diagnosis of dishonesty to a diagnosis of professionalism. He did not address the criticisms made in the interim report released last month by Commissioner Kenneth Hayne, in which much of the blame was directed at ASIC and the Australian Prudential Regulation Authority (APRA) for being too close to the banks and not taking them to court. Treasurer Josh Frydenberg said even before the release of the interim report that both regulators had a case to answer over scandals exposed by the royal commission. Mr Shipton, who started as ASIC chairman in February, told the conference that we have to reclaim that first line responsibility of ensuring that we have fair, efficient and honest conduct in our industry that is an obligation on you [under the law]. Regulation cannot be the sole solution, it has to be coming from the industry itself, he said. It was the responsibility of all of the 450,000 people who worked in the financial services industry to rebuild trust with the community, he said. As much we want to be everywhere, as much as we want to right every wrong, we can t be everywhere all the time, he said. John Collett

100 Canberra Times, Canberra Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 4 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 17,443 Words: 764 Item ID: Page 1 of 3 CBA boss revealed Youthsaver scam to board Clancy Yeates Commonwealth Bank chief executive Matt Comyn has admitted he should have done more to investigate the illegitimate setting up of children s bank accounts by staff when it came to his attention as head of its retail bank, in a contrite appearance before federal politicians. During a wide-ranging grilling that also focused on banker bonuses and CBA s charging of dead people, new details came to light about a previous scam in which Youthsaver bank accounts were activated by staff to game incentive systems. Mr Comyn was the first of the big four bank CEOs to appear before the government s ongoing parliamentary banking inquiry, the first detailed public questioning of the bankers since the royal commission s interim report was published two weeks ago. The Youthsaver issue, revealed by Fairfax Media in May, involved bank staff using their own money or bank funds to activate accounts that had been set up for school banking, sometimes known as Dollarmites. Depositing the cash meant the new account being opened would count towards the staff member s sales targets. Mr Comyn told a parliamentary hearing in Canberra on Thursday that staff tampering of children s accounts came to his attention more than five years ago, and confirmed he was subsequently interviewed about the issue and disclosed it to the board before his appointment as CEO. Under questioning from Labor MP Matt Thistlethwaite, Mr Comyn said that in late 2012, he received a forwarded as an FYI that was sent to branch staff telling them the conduct was unacceptable, but did not take further action at the time. I did nothing to go further into the subsequent investigation, and if I had my time again I would have, Mr Comyn said. CBA has previously said the conduct was inappropriate and was a breach of customer trust. On Thursday, it also emerged that law firm MinterEllison was commissioned by CBA in 2016 to investigate the issue, after a whistleblower raised concerns. The law firm interviewed Mr Comyn over his handing of the issue as head of the retail bank, and Mr Comyn disclosed this to the board when he was applying to be the chief executive of CBA earlier this year. As it relates to my appointment, just so there can be no misunderstanding, as you would appreciate during an interview process for a role such as the chief executive, I took it upon myself to proactively raise with the board any issues that I considered needed to be brought to their attention. This was one of them, Mr Comyn said. CBA s chief risk officer, David Cohen, said he recalled the MinterEllison report had found the whistleblower s allegations were not well founded but he could not recall what the exact allegations were. Mr Thistlethwaite suggested the long time it took CBA to investigate the tampering with children s bank accounts reflected a complacency within the country s biggest bank, which has suffered a string of scandals in recent years. Mr Comyn suggested to Mr Thistlethwaite th it thatt the matter

101 Canberra Times, Canberra Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 4 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 17,443 Words: 764 Item ID: Page 2 of 3 was far more extensive than what he had been told, but there were legal restrictions on what he could say about whistleblower cases. The new information was revealed in a wide-ranging grilling, with Mr Comyn admitting CBA had become complacent, and suffered from leadership failings and instances of greed. As the royal commission has shown, there have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said in opening remarks. Under questioning from inquiry chairman Liberal MP Tim Wilson about the Hayne commission s report, Mr Comyn said that in hindsight, the bank should have acted differently in financial advice, which has been a key problem area for the bank and the industry. Mr Comyn, who took over from Ian Narev earlier this year, also said the bank now recognised it should not have opposed a royal commission into the banking industry. As banks face pressure to prove they are holding people to account for misconduct, he said CBA had dismissed 41 people for poor behaviour this year, and nine had resigned while investigations were under way. Labor MP Matt Keogh took issue with the bank s comment this week that moves to investigate the charging of fees for financial advice to dead customers were part of its response to the Hayne royal commission. Did you really need a royal commission to tell you that? Mr Keogh asked, prompting laughter from some in the room. No, Mr Comyn replied.

102 Canberra Times, Canberra Author: Clancy Yeates Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 4 Printed Size: cm² Market: ACT Country: Australia ASR: AUD 17,443 Words: 764 Item ID: Page 3 of 3 CBA chief Matt Comyn at the hearing before the House of Representatives Standing Committee on Economics on Thursday. Photo: Alex Ellinghausen

103 West Australian, Perth Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 47 Printed Size: cm² Market: WA Country: Australia ASR: AUD 7,802 Words: 227 Item ID: Page 1 of 2 Kiwis fly into rage over Brisbane air display Brisbane It seems the lack of military jets in New Zealand is too much for the Kiwis to bear when they encounter them across the ditch. A bunch of New Zealanders are up in arms after taking exception to the actions of highly qualified RAAF pilots as they performed their usual aerobatics in Brisbane as part of the city s annual River- fire festival. A Boeing C-17 transport plane flew low over the crowd and close to buildings. But a group of Kiwis in the crowd slammed the stunt on social media as unnecessarily stupid and dangerous. All it would take is a small mistake and those buildings and people would be toast, one person wrote. Another added: I mean it s cool and stuff but that could ve gone very, very, VERY wrong. The New Zealand Herald, under the headline Watch: Terrifying moment plane flies towards buildings in Australia, even went as far as to suggest the pilots and festival organisers put residents and office workers in danger. It quoted some Kiwis as referring to the display as 9/11 stuff. It appears that for a nation that likes to think of itself as the adrenaline capital of the world, the Kiwis just don t have the need for speed. The plane over Story Bridge.

104 West Australian, Perth Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 47 Printed Size: cm² Market: WA Country: Australia ASR: AUD 7,802 Words: 227 Item ID: Page 2 of 2 The RAAF Boeing C-17 flies through Brisbane's CBD as part the Sunsuper Riverfire festival. Picture: Instagram

105 West Australian, Perth Author: Tim Clarke And Gary Adshead Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 1 Printed Size: cm² Market: WA Country: Australia ASR: AUD 12,500 Words: 536 Item ID: Page 1 of 2 $100 MILLION GONE BIG BUX FRAUD Dudded investors count the cost Tim Clarke and Gary Adshead Just $47,000 in cash remains among the paltry assets of the now defunct Bux mobile phone money transfer business, which had attracted $100 million in investments but yesterday was declared bust. A Federal Court judge granted a bid by dudded investors to wind up Bux Global, after months of legal fighting by founder Ray

106 West Australian, Perth Author: Tim Clarke And Gary Adshead Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 1 Printed Size: cm² Market: WA Country: Australia ASR: AUD 12,500 Words: 536 Item ID: Page 2 of 2 Webber and his associates to stave off the action. And the full scale of the demise of the company ed by 300 WA investors including boxing champion Danny Green and former cricketer Greg Matthews has begun to emerge, with the court confirming less than $2 million of the vast multiple investment remains, and most of that is tied up in intercompany loans. Only $47,530 in cash was found during initial audits into the company, which had hired current AMP chairman David Murray last year. Mr Murray, former editorin-chief of The Australian newspaper Chris Mitchell and former Nine Network executive Simon Kelly quit as advisers in April when The West Australian began investigating Bux. While giving his reasons to grant the winding up order, Justice Craig Colvin revealed that at the height of what creditors say was a massive fraud, Mr Webber transferred $1.2 million to his wife Rosalind. And The West Australian can now reveal some of the other personal expenses which Justice Colvin said the directors of the company paid for with the company s millions. Bank statements show almost $680,000 was withdrawn from a Commonwealth Bank account held in the name of Bux and transferred to a personal NAB account in Mr Webber s name between January 2015 and August More than $35,000 was spent on Cathay Pacific business class travel and close to $30,000 went on leasing two BMW cars. In a final legal gambit, Mr Webber had last week appointed his own Sydneybased administrator, Graeme Beattie, to Bux, with an up-front payment of $60,000. But yesterday, Justice Colvin said there was no way Mr Beattie could be seen to be independent. He removed him and appointed Martin Jones and Andrew Smith of Ferrier... CONTINUED P6 Investors lose millions as Bux bites the dust... FROM P1 Hodgson as liquidators. This is no ordinary liquidation, Justice Colvin remarked. In affidavits to the court, Mr Beattie had voiced his concerns about the apparent attempt to phoenix the Bux company into another entity, 2WayWorld Technologies, which is controlled by someone who recently resigned as a Bux director. And he said when he quizzed Mr Webber as to why no one was using the Bux app, the founder claimed he had been unable to market the service because of his lawyer bills. But records showed Mr Webber logged advertising spending of $1.5 million last financial year, compared with $621,000 in legal costs. Mr Beattie also said he had been unable to test the app to see if it worked because it had been removed from app stores and the Bux.com website was down. It was still down last night. The court was told financial regulator Australian Securities and Investments Commission have their own concerns that Mr Webber s son Andrew, the company s managing director, was not candid when answering their questions. ASIC s investigation into Bux continues.

107 West Australian, Perth Author: Shane Wright Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 6 Printed Size: cm² Market: WA Country: Australia ASR: AUD 7,802 Words: 396 Item ID: Page 1 of 2 Bosses admit banks let their customers down Shane Wright Economics Editor The heads of the nation s two biggest banks have offered a mea culpa for the misbehaviour and greed of their institutions after warnings dodgy executives may face much tougher penalties in the future. Commonwealth Bank chief executive Matt Comyn and Westpac boss Brian Hartzer admitted to a parliamentary committee a series of failings that have been exposed by the searing interim report from the banking royal commission. The pair fronted the committee in Canberra yesterday after commissioner Kenneth Hayne accused the entire financial system of succumbing to greed that put customers and their needs behind the remuneration practices of institutions. Banks have started to react to some of the preliminary findings, this week pledging to stop charging fees for no services or slapping fees on dead people. Mr Comyn, six months into his tenure running the CBA, said staff had been sacked and senior executives overall remuneration sliced by $100 million. He said the bank had let down too many customers. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, Mr Comyn said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. While outlining how Westpac was trying to focus on being a service company rather than a bank that sold products, Mr Hartzer warned against regulations that might hurt the bottom line of banks. House prices are falling, income growth has been low, and consumer spending is likely to be affected by people s confidence in the value of their home, he said. Therefore, regulatory changes that impact how much individuals can borrow, the cost and availability of credit for business, or the availability and affordability of suitable financial advice should be considered carefully. Banking regulator Australian Prudential Regulation Authority chief Wayne Byres signalled it would go harder against rogue bankers and banks. APRA has come under fire from the royal commission, especially its failure to take court action against institutions and individuals. Consistent with prudential supervisors around the world, APRA has traditionally examined cases of poor conduct as an indicator of risk but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of the system or an individual institution, Mr Byres said.

108 West Australian, Perth Author: Shane Wright Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 6 Printed Size: cm² Market: WA Country: Australia ASR: AUD 7,802 Words: 396 Item ID: Page 2 of 2 Commonwealth Bank s Matt Comyn. Westpac boss Brian Hartzer. Pictures: AAP

109 West Australian, Perth Author: Helen Shield Section: Business News Article type : News Item Classification : Capital City Daily : 147,676 Page: 55 Printed Size: cm² Market: WA Country: Australia ASR: AUD 2,244 Words: 273 Item ID: Page 1 of 1 Tinley to take on tax pleas Helen Shield Housing Minister Peter Tinley has pledged to ask Treasurer Ben Wyatt to consider the WA property industry s pleas to defer the foreign buyer surcharge. Urban Development Institute of Australia WA chief executive Allison Hailes yesterday told Mr Tinley the industry found it incongruous the surcharge could be introduced in the middle of a property downturn. To start from January 1, the 7 per cent tax is expected to raise $120 million over four years. Yesterday Ms Hailes asked Mr Tinley if the State Government would defer it for a year or two until the market recovered. Perth, unlike Melbourne and Sydney, with similar taxes, did not have an overheated market or strong levels of international migration, she said. We don t resile from the hard decisions, Mr Tinley said, conceding the tax had not been popular. We have lost a bit of bark on some of those decisions (to cut costs)... We have to have some sort of commitment to budget repair. It s not just the foreign buyers tax. I will... talk to Ben about it, see have they done any modelling and get you a response, because we owe you that. Mr Tinley said it was crucial that all three tiers of government worked to resolve housing affordability. He took aim at Federal taxes making it more attractive for Australian super funds to invest in build-to-rent projects overseas than locally. He was speaking at the UDIA s Solving the Housing Affordability Challenge lunch yesterday. Property expert Gavin Hegney later moderated a panel with Department of Communities Nigel Hindmarsh, Now Living s Troy Gorton, ShelterWA s Michelle MacKenzie and City of Cockburn s Stephen Cain.

110 Sunshine Coast Daily, Maroochydore QLD Section: General News Article type : News Item Classification : Regional : 10,046 Page: 37 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 281 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week. far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because

111 Cairns Post, Cairns Section: General News Article type : News Item Classification : Regional : 13,896 Page: 32 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 1,229 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (right), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week.

112 Gold Coast Bulletin, Gold Coast QLD Section: General News Article type : News Item Classification : Regional : 21,468 Page: 30 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 1,797 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank has taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week.

113 Townsville Bulletin, Townsville QLD Section: General News Article type : News Item Classification : Regional : 16,484 Page: 36 Printed Size: cm² Market: QLD Country: Australia ASR: AUD 1,487 Words: 399 Item ID: Page 1 of 1 We became complacent Commonwealth Bank chief admits failures, greed COMMONWEALTH Bank chief executive Matt Comyn has spoken face-to-face with customers affected by the kind of misconduct revealed at the banking royal commission. Mr Comyn (pictured), who took up the top job six months ago, has revealed the fact while being grilled by federal politicians at a parliamentary hearing in Canberra. It came after he acknowledged the hurt the bank s actions have caused. I certainly acknowledge the hurt and the very, very difficult circumstances that some of our customers have found themselves in, and some of that as a result of our actions, he said yesterday. The chief executive said there was no substitute for hearing those people s stories directly, and he had spoken with a number of them over the phone and fewer than 10 of them in person. To get a proper understanding of the individual cases, some of them are very, very complex and they do take quite a bit of time, he said. So far this year, 41 Commonwealth Bank employees have been terminated due to misconduct, while another nine have resigned while being investigated, Mr Comyn said. He could not confirm how many of the sackings were directly linked to revelations at the royal commission. Mr Comyn earlier admitted the Commonwealth Bank was too slow to fix customer service problems uncovered by the royal commission because it had become complacent. There have unfortunately been failures of judgment, failures of process, failures of leadership, and in some instances, greed, he said. We ve been too slow to identify problems, too slow to fix underlying issues, and too slow to put things right for customers. We became complacent. Mr Comyn laid out the steps the bank had taken, including strengthening its lending processes and making it simpler for customers to choose products. But he said they had plenty of work to do to regain trust. The hearing is being held by the House of Representatives committee on economics as part of a review into the big four banks. It comes less than two weeks after royal commissioner Kenneth Hayne QC delivered an interim report, blaming greed and the pursuit of profit for the widespread misconduct in the banking and financial services industries. Westpac CEO Brian Hartzer also fronted the hearing yesterday, ANZ chief executive Shayne Elliott will appear today and National Australia Bank boss Andrew Thorburn will appear next week.

114 Northern Territory News, Darwin Author: Sophie Elsworth Section: General News Article type : News Item Classification : Capital City Daily : 11,279 Page: 3 Printed Size: cm² Market: NT Country: Australia ASR: AUD 1,271 Words: 315 Item ID: Page 1 of 1 Super millions lying idle One Territorian has almost $700k waiting for them EXCLUSIVE SOPHIE ELSWORTH than $200 million of Territorians super is sitting idle waiting to be clawed by its rightful owners. The massive pot of hard earned cash sits in 48,000 of our accounts one of which holds a staggering $690,000 waiting to be reunited with their rightful owners. The funds are part of Australian superannuation savings worth $17.5 billion sitting in unused accounts. The largest amount, in New South Wales, has a mouth-watering balance of $2.2 million. New figures from the 2017/18 financial year released by the Australian Taxation Office revealed there are 6.2 million accounts waiting to be reunited with owners. The average balance is $2933. People who have changed their jobs, moved house or forgotten to update their personal details are among those most likely to have retirement savings missing. The money waiting to be claimed is resting in lost or unclaimed super accounts. A lost super account is held by super funds where the fund has lost contact with the member and has not received a contribution for a year or more. A lost account becomes unclaimed and is sent to the ATO where the amount is less than $6000. Accounts also become unclaimed where individuals are eligible to withdraw but the super fund cannot contact them. ATO assistant commissioner, Graham Whyte, said Australians should check online to see if they have money that can be put in their hands. People have become disconnected and what we want to do is reconnect them, Mr Whyte said. The ATO has released postcode data that will allow Australians to check how much lost or unclaimed super is waiting to be claimed where they live. TOP 3 NT postcodes with the highest amount of lost and unclaimed super Darwin's northern suburbs: $27,367, Alice Springs and surrounds: $21,275, Fannie Bay and surrounds: $20,286,060 *Source ATO

115 Australian Financial Review, Australia Author: James Eyers Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 7,767 Words: 581 Item ID: Page 1 of 2 CBA 'abusing the law 9 fighting customers: Labor James Eyers Labor MPs have chastised the Commonwealth Bank for its aggressive litigation tactics and lack of empathy for aggrieved customers as the bank pledged to do more to ensure deceased estates haven't been charged inappropriate fees following scandals revealed by the royal commission. CBA chief executive Matt Comyn told a parliamentary committee 2500 of its bankers had failed risk management assessments during the latest performance reviews, while 41 employees had been sacked following cases exposed by the royal commission. Nine more had resigned while investigations against them were on foot. But Labor committee member Clare O'Neil said this wasn't enough; her travels around the country with Labor leader Bill Shorten meeting victims of bank misconduct revealed widespread grievances with CBA's approach to handling complaints, she said. "I want you to understand that CBA is over-represented in these discussions," she told Mr Comyn, before calling out the bank's aggressive litigation tactics against vulnerable customers. "One of the issues I am most worried about coming out of these discussions is the way I see the Commonwealth Bank abusing the law, the power you have in courts, the power you have to marshal major large law firms to take on people who are powerless and who are presenting themselves in the Supreme Courts around this country," she said. Mr Comyn, who was heckled throughout the hearing by a group sitting in the public gallery, was forced to acknowledge "the hurt and the very, very difficult circumstances, that some of our customers have found themselves in, and some of that is as a result of our actions". The prudential inquiry into CBA this year found it had taken an overly legalistic approach towards disputes. The CBA boss was also put on the foot when asked how many "victims" he had met with face-to-face since becoming CEO. He said it was "less than 10". However, he added he'd been engaging with many others via phone calls or . After announcing it would rebate previously-charged grandfathered commissions earlier this week, Mr Comyn flagged the potential for CBA to pay additional remediation costs. The bank is reviewing fees charged to deceased estates - conduct Mr Comyn described as "reprehensible" - going seven years. The bank has already reviewed 140,000 filed but only over a three month period. "There is no escaping that in fees-forno-service in the advice business, there simply wasn't the requisite levels of controls and systems and processes to ensure that we could demonstrate customers were only charged for the services they were actually provided," Mr Comyn told the House of Representatives standing committee on economics, chaired by Liberal MP Tim Wilson. CBA is working to create a new culture that empowered staff to challenge decisions that were not being made in the interest of customers or the bank's revised values, and to strengthen the ability to whistleblowers to make complaints. Mr Comyn said. The CBA boss also expressed regret that staff had faced abuse and criticism from customers, and said it "should be directed to the most senior executives in the organisation, starting with me". The interim report had shown CBA had been "too slow to "get to root cause, we haven't fixed issues, and whilst we have invested in things like customer remediation, we haven't done enough to prevent instances re-occurring". I want you to understand that CBA is over-represented in these discussions. Clare O'Neil, Labor committee member

116 Australian Financial Review, Australia Author: James Eyers Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 19 Printed Size: cm² Market: National Country: Australia ASR: AUD 7,767 Words: 581 Item ID: Page 2 of 2 Labor's Clare O'Neil is concerned the Commonwealth Bank is abusing its power, PHOTO: BRADLEY KANARIS

117 Australian Financial Review, Australia Author: Sally Patten Section: Boss Article type : News Item Classification : National : 44,635 Page: 8 Printed Size: cm² Market: National Country: Australia ASR: AUD 18,892 Words: 1226 Item ID: Page 1 of 2 BETTER CITIZENS Most companies are a long way from grasping what it means to have a social licence to operate. STORY SALLY PATTEN PHOTO SIMON SCHLUTER Jeffrey Tobias, an adjunct professor at the Australian Graduate School of Management at the University of NSW, recalls a conversation a couple of weeks ago with a banker on social licence. "Having a social licence is all very well but what happens when you get to the end of the quarter and you are told you have just got to sell more?" the banker asked. The Ethics Centre defines a social licence to operate as "the informal acceptance granted to an individual or organisation by a local community". It's a hot issue, given a proposal to require companies to hold a "social licence to operate" was included in changes to the ASX Corporate Governance Principles. The clause may not make the final version of the code, after Corporate Governance Council chair Elizabeth Johnstone flagged dropping it. Regardless, companies will need to think hard

118 Australian Financial Review, Australia Author: Sally Patten Section: Boss Article type : News Item Classification : National : 44,635 Page: 8 Printed Size: cm² Market: National Country: Australia ASR: AUD 18,892 Words: 1226 Item ID: Page 2 of 2 about their acceptance by the community if they are to ensure their customers keep on buying their products, their employees stay engaged and politicians don't start introducing tough new laws and taxes - and most are not, says Geoff Martin, associate professor at Melbourne Business School. "The vast majority of businesses are a long way from understanding their social licence to operate. Most executives are only just beginning to delve into it," says Martin. "The banks never grasped the need to earn a social licence to operate. They thought it was irrelevant." As a result, they were lumbered with a bank levy and forced to accept a royal commission into the financial services sector. Fundamentally, he says, the social licence to operate is a risk-management issue. Tobias adds: "I don't think most companies care about it. It comes up as an agenda item for the board. It's not in the core." He notes that the United States is much further along the curve, partly thanks to the threat of litigation from disaffected stakeholders. In Australia, the apparent Johnny-comelately approach to understanding social licence has led many organisations to conclude that consumer expectations have changed, making it difficult to meet these shifting community standards. In February, when banking royal commissioner Kenneth Hayne called on financial services companies to identify conduct since January 2008 that might have fallen below community expectations and standards, there was much debate about exactly what those expectations were then and now. The latest report by the Victorian gambling regulator on Crown Casinos' licence pointed to a "lack of progress regarding Crown's approach to responsible gambling, such as might now be required... to meet heightening community... expectations". But when it comes to ethics, the difference between right and wrong and the treatment of customers, it is hard to believe that expectations have changed that much. "Community expectations have shifted slightly because of the royal commission but those unethical activities were always unacceptable. Industry leaders may not have realised the depth of anger from the community format behaviour," says director Ming Long. Nicole Gillespie, associate professor of management at University of Queensland Business School, says: "I would argue that expectations do not shift overnight. Community expectations do evolve over time. It takes time for that shift to occur." Marc Stigter, strategist and author of Boards that Dare, adds: "I don't think consumer expectations are changing quickly." THE TRUST DEFICIT Rather, the public is becoming aware of the way in which companies and institutions behave, partly thanks to the plethora of news channels and social media. As Stigter says: "Views are travelling much faster. All those things are being brought to the forefront more prominently." Chris Sanderson, co-founder of business adviser The Future Laboratory, says: "Consumers are going through a period where they are putting large organisations under a microscope. We no longer expect brands and corporates to behave in a way that demonstrates good corporate governance. The expectation is that brands are hiding something from us." Momentous events have also allowed the public to see under company bonnets. In terms of financial services, Klein notes that in the United States the lid was lifted after the global financial crisis, when Americans "got a glimpse into the idea that financial institutions and advisers often do what is best for them". Australians have had their wake-up call in 2018 with the Hayne royal commission. In areas such as service levels, rather than ethics, however, it is clear that expectations are changing, says John Stanhope. Stanhope is the chair of Australia Post, a director of AGL Energy and chancellor of Deakin University, but is speaking to BOSS in a personal capacity. The definition of convenience has changed several times over the past few years, Stanhope says. These days it is perhaps best described as: "I want the parcel now." The lack of trust in organisations, combined with changing expectations in areas such as service, is making it far more difficult for companies to gain and retain a social licence. Jill Klein, a leadership and consumer behaviour specialist who, like Martin, is from Melbourne Business School, says companies have no choice but to conduct a great deal of research to ascertain the extent to which they are, or are not, meeting community standards. "The first thing I say is: measure, measure, measure," she says. "You can't guess. You are usually going to be wrong if you guess." Klein points to the need for systematic research, done on a regular basis, so that a baseline can be established. MORE REPRESENTATIVE Martin says company research should include talking to politicians, at all levels. "They have their finger on the pulse," he says, suggesting that companies ask politicians about the issues that are important in their areas. Another way to learn about community attitudes is to talk to community leaders. He suggests talking to the local football coach, netball coach or the head of a local charity. The research might show that for some companies, their customers don't actually care about social licence. BP's Deepwater Horizon oil spill of 2010, considered the largest marine oil spill in the history of the petroleum industry, did not have a big impact on sales of BP petrol. The same is unlikely to be the case if an organic food company was found to have caused severe environmental damage. Assuming that customers do care about the social licence, Long says a good place to start obtaining it is greater diversity at senior levels. She questions how companies are able to keep track of community expectations and maintain a social licence, given the homogeneity of management and boards. "Organisations must reflect the community. Otherwise, how do you represent them?" Martin expects Australian companies will develop partnerships with not-forprofit bodies, such as UN agencies, nongovernmental organisations, social impact investors, foundations and government organisations, in an effort to create "shared value" and gain and retain acceptance in the community. But, he warns, it must be done in a credible way, which, he argues, is by and large not the case. "The problem is that if you do it in a tokenistic way and without integrating a particular culture and values, you are at the risk of being seen to have done it for cynical reasons," he says. "[Partnerships are] ineffective if you are not addressing the cultural problems in the organisation. It will be pointless unless you do a complete cultural purge of the organisation."

119 Australian Financial Review, Australia Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 16 Printed Size: cm² Market: National Country: Australia ASR: AUD 3,499 Words: 433 Item ID: Page 1 of 1 IPO wins: PEXA board votes to take the company to the ASX Property settlements exchange company PEXA's directors have voted to brave equity market conditions and seek to create Australia's listed technology sector unicorn. At a board meeting in Melbourne on Thursday, held as high-growth technology stocks were hit hard by the Australian market's $49.6 billion market rout, it is understood PEXA's board opted to strap on their hard hats and pursue an initial public offering as its preferred exit option. The decision to go down the IPO path was a strong show of confidence in the new property settlements platform, its growth, its management team headed by CEO Marcus Price, and listed investor interest in the business. The alternative exit route - accepting a bid from shareholders Link Group and Commonwealth Bank of Australia, in conjunction with Morgan Stanley Infrastructure Partners - has been put on the burner, sources said. PEXA is expected to seek a listing that would value the business at $1.6 billion to $2 billion. Its brokers, Macquarie Capital and Morgan Stanley, presented the IPO option to the company's board on Thursday and are expected to ramp up marketing in the coming fortnight The two firms made their first pitch to investors late last month, when they sent their analysts to meet with fund managers to explain PEXA and seek to value the business. The pair has since surveyed fund managers globally, and will soon be asking those same investors to write cheques. It is understood PEXA's directors, advised by CLSA on the dual-track auction, signed off on the IPO plan after much discussion about market risk. Australia's benchmark index, the ASX/S&P200, has dropped 7 per cent in the past six weeks and is tipped to fall further, at least in the short term. PEXA's directors, some of who represent the company's shareholders, voted that the company's strong business case and cash flow growth should be enough to allay any investor concerns about the market The question now is which of PEXA's shareholders will sell or reduce their stakes at the IPO. The company's biggest investors include Macquarie (23 per cent), Link (19.8 per cent) and CBA (12 per cent). Its other shareholders include the other big four banks, four state governments and former Toll Holdings MD Paul Little. The ers created the company about 10 years ago to digitise property settlements. It is understood PEXA's board does not yet know exactly how much of the company could be sold as part of the sharemarket listing. Early indications are it could be as little as 30 per cent to 40 per cent, depending on what Macquarie and Link do.

120 Australian Financial Review, Australia Author: Jemima Whyte Section: Boss Article type : News Item Classification : National : 44,635 Page: 24 Printed Size: cm² Market: National Country: Australia ASR: AUD 9,931 Words: 857 Item ID: Page 1 of 1 Bank board directors present and past will be in the firing line this annual meeting season as the impact from the Hayne royal commission hits. STORY PATRICK DURKIN National Australia Bank and tainted bank board directors face a lash from investors in this year's annual general meeting season, as the Hayne royal commission has investors in the mood to punish individual directors. Ten top 300 companies face a second strike this year and a spill of their board, including the must-watch Myer AGM where billionaire retailer Solomon Lew is expected to throw his weight behind a spill. NAB, JB Hi-Fi and isentia all face protest votes as they move to "simplified" remuneration structures, which collapse short- and long-term incentives achieved via a balanced scorecard of financial and non-financial metrics. The new structures have investors divided. Rio Tinto chairman Simon Thompson recently wrote to investors after the miner proposed moving to this model to advise there was not enough investor support to proceed. The Australian head of proxy adviser ISS, Vas Kolesnikoff, is unimpressed. "The fact that someone can try to pull the wool over the Australian market that 'simplified' structures are in shareholder interests is ridiculous, as these only work in executives' interests," he says. "Remuneration strikes will be higher this year, and may be to 2016 levels." That year, more than a dozen top 300 companies received strikes. Early adopters of these simplified pay models, including QBE, AMP and MYOB, have already been hit with big protest votes. Joel Posters, head of investment at the Future Fund, warns the model may be "flawed", despite some fund managers arguing that giving executives more "skin in the game" is positive. The country's other leading proxy adviser, CGI Glass Lewis' Australian head Daniel Smith, thinks the NAB plan will leave bank executives, not shareholders, better off. The Australian Shareholders' Association (ASA) is also not convinced. NAB chairman Ken Henry admits not everyone is supportive. Posters warns: "By basing executive remuneration on performance over only a one-year period, these new structures appear to head in the wrong direction." This is the case even where the shares vest over three or more years, he says. The Hayne royal commission will be front of mind after former AMP chairman Catherine Brenner was forced to quit the boards of Coca- Cola Amatil and Boral in the first high-profile case of individual directors being targeted. Former ABC chairman Justin Milne is also expected to face pressure over his chairman roles at listed MYOB and NetComm, and his role as a director of Tabcorp. Bank boards are most at risk. Even leading directors no longer on bank boards - for example CBA directors between 2010 and ASX300 COMPANIES WITH STRIKES AGAINST PAY i 1 Ainsworth 2 Cromwell I Property I 3 isentia I 4 Karoon Gas I 5 Liquefied i Natural Gas i G Mineral Resources I I Mortgage Choice i 8 Myer Holdings S Reliance Worldwide I 10 TPG Telecom Details from 2017! Source: AFR 2016 such as Launa Inman, Jane Hemstritch, Carolyn Kay and Brian Long - are expected to be targeted. "Some shareholders will be looking through other companies where a former director of a bank now sits," ISS' Kolesnikoff says. Shareholder activists will also be out in force on environmental, social and governance (ESG) issues, with Origin being targeted over emissions and Qantas in the firing line over the human rights impact of its flights being used to deport immigration detainees. Proxy firms, superannuation funds and retail investors warn that they will look more closely than ever at individual directors - their tenure, skills, commitments, gender and any connection to the royal commission. "There is little doubt that the royal commission may colour how investors vote at this AGM season," the Australian Council of Superannuation Investors (ACSI) says. ASA chief executive Judith Fox agrees. "We will want to see board accountability," she says. "We'll be looking to see if the boards of the banks have dealt with the issues witnessed at the royal commission. "Investors will not vote in favour of directors up for re-election if there is little evidence of boards holding management's feet to the fire." BOARDS WITH NO WOMEN CGI Glass' Lewis warns that overloaded and long-serving directors, as well as nomination and remuneration committee chairmen, will be in the firing line. CGI is tightening its policies to reduce its threshold for independence from 15 to 12 years, and for overloaded directors from six to five public companies, with a chair role equivalent to two directorships. Other experts say three listed boards is enough. CGI and ACSI also plan to target the chairs of 300 nominations committees where the board has no women. Three ASX 200 companies - ARB Corporation, Tassal Group and TPG Telecom - have no female directors. "We may extend this recommendation to vote against other nominating committee members," CGI warns. Finally, there is momentum behind the push for annual director elections, which would put individual directors under even more scrutiny, and a divisive debate on shaking up shareholder resolutions. The two sides - boards and investors - are deeply divided on the need for change, according to an industry round table with key players this year.

121 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 14,017 Words: 1072 Item ID: Page 1 of 3 Westpac warns on Hayne overreach James Eyers Politicians should be wary that overloading new regulation on the banking sector in the wake of the Hayne royal commission could harm the economy by exacerbating the housing downturn and making it harder for businesses to borrow, Westpac Banking Corp CEO Brian Hartzer has warned. While acknowledging the "incredibly confronting" interim report published a fortnight ago and again apologising for the bank's misconduct, Mr Hartzer said he supports Commissioner Kenneth Hayne's call for simpler regulation. Policymakers must also "remain live to the potential second-order effects of new legislation and regulation", given vulnerability in the economy. "House prices are falling, income growth has been low, and consumer spending is likely to be affected by people's confidence in the value of their home," Mr Hartzer said. "Therefore regulatory changes that impact how much individuals can borrow, the cost and availability of credit for business, or the availability and affordability of suitable financial advice should be considered carefully." Mr Hartzer and Commonwealth Bank of Australia chief Matt Comyn appeared before the House of Representatives economics committee chaired by Liberal MP Tim Wilson in Canberra yesterday in the first round of hearings since the royal commission's interim report ahead of an appearance by ANZ chief executive Shayne Elliott today. Mr Hartzer's comments come after Treasurer Josh Frydenberg said the government was aware heavy-handed regulation in response to the report could restrict lending and hurt the economy. He said potential credit rationing by banks would be more harmful for lower-income earners or recent immigrants seeking credit "If we make it really proscriptive about the level of history and Continued pt8 Overworked KWM grads complain p3 Wake-up call from APRA, ASIC p15 MPs turn on CBA legal tactics pl9 Chanticleer Not just banking page From page 1 Westpac warns on Hayne overreach documentation that someone needs before they can get a home loan, then we, in some ways, end up restricting the access to credit for people at lower levels of society and tilt the playing field to people who have a lot of money or assets already." Mr Hartzer's warnings on the dangers lurking in the interim report contrasted with the apologetic, grovelling appearance from CBA's Mr Comyn, who admitted the nation's largest bank had become complacent and was too slow putting things rights for customers. "Trust is absolutely the cornerstone of any financial institution - it needs to be - and of course we recognise it has been damaged and that is an enormous concern to us," he said in the first comprehensive response of a big bank boss to the interim report Mr Comyn said it had identified "failures of judgment, failures of process, failures of leadership and in some instances, greed" and revealed "a number of significant failures on our part Those failures are our fault and we are working very hard to address those failures." After the banks initially rejected the need for a royal commission, the CEOs admitted it had been a valuable process albeit a painful one, on the same day the chairman of both the corporate and prudential regulators responded to the interim report in an event in Sydney - which was also critical of their oversight of the banks. Australian Securities and Investments Commission chairman James Shipton described the report as a "horrible diagnosis of dishonesty" and a "blight" on the financial services industry, while Australian Prudential Regulation Authority chairman Wayne Byres called for bankers to become more professional, like doctors or lawyers. Mr Hartzer said he was surprised at the breadth of issues in the interim report and said "it is really clear we have a lot of work to do to restore community trust". Yet he pushed on a suggestion from Greens committee member Adam Bandt that the remuneration of senior bank executives might be regulated to restrict the amount of discretionary remuneration they are paid. Mr Hartzer said this would make it harder to attract management talent in a globally competitive market place. However, both Mr Hartzer and Mr Comyn agreed with Commissioner Hayne's assessment that remuneration incentives played a role in the misconduct that has been identified, and while their banks have already reduced the impact of banker pay based on sales they both said more improvements could be made. "Certainly incentives have played a role in some of issues we are facing now. It is very hard to conclude otherwise. There is of course a complex interplay of factors which do not only include incentives... but there may still be more work to do," Mr Comyn said. CBA branch tellers have no financial metrics linked to their pay and only 30 per cent of Mr Comyn's own remuneration is linked to CBA's financial performance, down from 60 per cent and the lowest level of a CBA CEO in decades, he said. Mr Hartzer said Westpac has also reduced sales-based remuneration but defend it for some staff given the capitalist enterprise. But there's a need to strike a balance, to "reward people who work hard and do a good job looking after customers and as a result their business grows and allow them to benefit from that success, but at same time not to create perverse incentives to cause them to push a particular product to someone who doesn't need if'. With bank shares closing sharply lower in the market rout on Thursday after suffering throughout the year on fears the inquiry will lead to big remediation bills, Mr Hartzer said shareholders are "deeply disappointed" with the bank's returns. "I can assure you they are not happy about it" Both CEOs approved of government policies introduced to attempt to fend off the calls for the inquiry, including

122 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 14,017 Words: 1072 Item ID: Page 2 of 3 speeding up dispute resolution via the Australian Financial Complaints Authority, and clarifying executive responsibility through the Banking Executive Accountability Regime (BEAR). CBA said it has extended BEAR to 90 executives, more than is required by the legislation. The committee hearings on Thursday also revealed potential policy proposals to respond to Commissioner Hayne's concerns. For example, Labor member Matt Thistlethwaite asked Mr Hartzer whether he supported extending the FOFA's best interest duty to mortgage brokers. The Westpac chief said that was worthy of consideration, but urged caution given it could reduce the profitability of brokers which could have the result of reducing competition and customer choice. NAB chief executive Andrew Thorburn appears before the committee on October 19. Certainly incentives have played a role in some of issues we are facing now. Matt Comyn, CEO CBA Commonwealth Bank CEO Matt Comyn, left, and Westpac CEO Brian Hartzer. PHOTOS: BLOOMBERG, ALEX ELLINGHAUSEN

123 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 14,017 Words: 1072 Item ID: Page 3 of 3 Brian Hartzer: 'Trust is absolutely the cornerstone of any financial institution - it needs to be." PHOTO: BLOOMBERG

124 Australian Financial Review, Australia Author: Joanna Mather Section: General News Article type : News Item Classification : National : 44,635 Page: 9 Printed Size: cm² Market: National Country: Australia ASR: AUD 2,994 Words: 307 Item ID: Page 1 of 1 Henderson guilty offpa violations Joanna Mather Former financial adviser Sam Henderson has been found to have breached professional standards - six months after appearing before the banking royal commission and nearly a year after the Financial Planning Association of Australia commenced disciplinary action. The FPA's independent disciplinary body found nine of 10 allegations against Mr Henderson to be "proven", although no sanctions were immediately imposed. Mr Henderson quit the industry after appearing before the royal commission, which heard how he advised Donna McKenna to transfer her superannuation savings into a self-managed fund. Had she followed that advice, Mr Henderson's firm would have collected extra fees but she would have immediately forfeited $500,000. One of the firm's staff members also impersonated Ms McKenna in a phone call to her super fund. The FPA's disciplinary body heard the matter on August 14 and a determination was made on September 10, but the decision was announced via an FPA media release on Thursday. Chief executive Dane De Gori said Former financial adviser Sam Henderson, PHOTO: AAP FPA members were required to uphold the highest ethical standards and Mr Henderson had failed to meet those standards. "The FPA is committed to standing with Australians for a better financial future and enforcement of the FPA Code is an important aspect of that commitment," he said. In his interim report, Commissioner Kenneth Hayne said Mr Henderson's conduct may have breached the Corporations Act The FPA commenced disciplinary proceedings last November, based on a complaint by Ms McKenna. Mr Henderson had a television show on Sky News and contributed general superannuation advice in AFR Weekend. Both arrangements have been cancelled. Commissioner Hayne concluded Mr Henderson's failure to provide adequate assistance to the FPA with its investigation, and his personal criticisms of Ms McKenna fell below community standards and expectations. The parties were invited to propose sanctions and outline costs.

125 Gold Coast Bulletin, Gold Coast QLD Author: Sophie Elsworth Section: General News Article type : News Item Classification : Regional : 21,468 Page: 3 Printed Size: 75.00cm² Market: QLD Country: Australia ASR: AUD 550 Words: 180 Item ID: Page 1 of 1 $17b super remains unclaimed SOPHIE ELSWORTH AUSTRALIANS have a massive pot of superannuation savings worth $17.5 billion waiting to be clawed. And the largest amount yet to be claimed has a staggering balance of $2.2 million. Figures from the financial year, released by the Australian Taxation Office, reveal there are 6.2 million superannuation accounts waiting to be reunited with owners, with an average balance of $2933. People who have changed their jobs, moved house or forgotten to update their personal details are among those most likely to have retirement savings missing. In Queensland, $3 billion in super is sitting idle in more than 706,000 accounts. The largest amount is $1.1 million. ATO assistant commissioner, Graham Whyte, said Australians should check online to see if they have some of their own money that can be put in their hands. It s your money and you ve worked hard to earn it. It s your retirement savings and you will need it one day, he said. Accounts also become unclaimed when individuals are eligible to withdraw but the super fund cannot contact them to notify it s available.

126 Australian Financial Review, Australia Author: Patrick Durkin Section: General News Article type : News Item Classification : National : 44,635 Page: 6 Printed Size: cm² Market: National Country: Australia ASR: AUD 5,562 Words: 626 Item ID: Page 1 of 1 Costello quizzes Morrison over economic narrative Patrick Durkin Karen Chester pointed to failures across the education and superannuation system. Prime Minister Scott Morrison has rejected criticism by former Treasurer Peter Costello that the government doesn't have an economic narrative, after the Productivity Commission also took aim at ineffective government Mr Costello told a Melbourne Institute conference in Melbourne on Thursday that he is still not sure what the government's economic narrative is, criticism that Mr Morrison later rejected as he formally announced the government would bring forward $3.2 billion in small and medium business tax cuts. "When Malcolm Turnbull challenged in 2015, he said there was no economic narrative, I agreed... but I kept waiting for an economic narrative," Mr Costello said. "I'm still not sure what the narrative is." Mr Costello mocked the debate about tax cuts for large business as "weird", claiming that tax policy decided today would not determine the tax rate in 2026 and the only way forward was for politicians to be accountable for their current and next term. "Governments are finding it hard to deliver on their policies in a particular term, so you know what they start doing, they start promising you a policy in 2026," he said. "If anyone believes it you're silly. The only chance of holding a government accountable is something they will do in their term." When asked about Mr Costello's comments, Mr Morrison said "an economic narrative is about what you believe as well and what I am seeking to do is to connect Australians with what our government passionately believes in and why taxes should be lower", he said. "Thafs what governments have to get better at explaining, the why." The debate about an economic narrative came after Productivity Commission deputy chairman Karen Chester warned the conference that "today's public policy playlist" was "more one of the incremental". "If we find ourselves in the absence of effective government, economic growth with equity will become elusive," Ms Chester said pointing to failures across the education and superannuation system. Ms Chester said there were deteriorating results in key subjects such as maths and reading, the "VET system is a mess" and that universities needed to improve student employment outcomes. "Undergraduate underemployment has more than doubled in the last decade to now reach just over 20 per cent" she said. 'Taken collectively, this unfortunate troika erodes our capacity to deal with future labour market changes in an efficient and equitable way." Ms Chester also pointed to the the $2.7 trillion super system as needing urgent competition but revealed the Productivity Commission would rethink its controversial best in show recommendation, as Labor's Treasury spokesman Chris Bowen told the conference his party had concerns about the proposal. The Productivity Commission recommended in its May draft report that an expert panel pick the 10 best performers to act as default funds, to be reviewed every four years, but Ms Chester suggested the recommendation would change in the final report in the wake of strong industry feed. "We like Darwinian man do evolve in our process, so our draft report was out and were our views at that time, we will now look at drawing upon the 137 submissions, the 120 people that we heard from at our public hearings and refine and polish those recommendations for government," Ms Chester said. She has already suggested that the Reserve Bank governor, along with perhaps the chairman of the Australian Competition and Consumer Commission and the commissioner of the Tax Office select the expert panel to make the process apolitical. Ms Chester's comments came after Mr Bowen told the conference Labor had reservations about the idea and also wanted to hear what the Hayne royal commissioner - which has already triggered billions being poured into industry super funds - concluded.

127 Australian Financial Review, Australia Author: Myriam Robin Section: General News Article type : News Item Classification : National : 44,635 Page: 40 Printed Size: cm² Market: National Country: Australia ASR: AUD 13,794 Words: 1497 Item ID: Page 1 of 3 Chanticleer For crowing there was not his equal in all the land... A bank is no longer about banking Itwas the sort of day that Commonwealth Bank chief executive Matt Comyn and Westpac boss Brian Hartzer would have liked to be holed up at head office. With global equity markets reverberating from a sell-off in the US bond market and ever-escalating trade wars, Australian shares copped the flow-on effect, with the ASX down 2.7 per cent, with $50 billion wiped off the value of local stocks. No doubt the bank CEOs would have liked to have been taking the temperature of their traders and treasury staff, watching funding costs and currency markets, and generally rallying the troops. Instead, Comyn and Hartzer found themselves in Canberra to submit to a grilling at the hands of the House of Representatives standing committee on economics. It was perfect demonstration of why banking is no longer the main job of an Australian bank CEO. A decade of misconduct that shattered the trust of the community, and was so brutally exposed by the royal commission, means bank bosses will find their next few years occupied by a mix of public relations, customer remediation, corporate restructuring and internal cultural change. The banks obviously only have themselves to blame for that But Thursday's sessions before the economics committee highlighted just how long and difficult the process of winning the trust of the community will actually be. Comyn and Hartzer took similar approaches to their appearances, but with slightly different tones. The CBA chief executive entered full mea culpa mode from the outset, apologising for everything and anything. He said sorry for the bank's misconduct Its failure to promptly remediate customers. Its culture. Its remuneration structure. The way it's board operated. If Comyn had been asked to apologise for the sinking of the Titanic, the death of Phar Lap and Greg Chappell's decision to force his brother Trevor to deliver that famous underarm ball in 1981, he probably would have. There was cleansing element to all of this, to be sure. Comyn was the first big bank chief executive to speak publicly since Commissioner Kenneth Hayne delivered his searing interim report So as a nation, we needed to hear Comyn admit that there had been "failures of judgment, failures of process, failures of leadership and in some instances, greed". Australians needed to hear Comyn say that the bank had become complacent blinded in part by its success and huge profits. It needed to go on the public record that the bank had underinvested in compliance, and that it had failed to act as promptly as it should have to fix problems and remediate customers affected. And it was perhaps most important of all to see Comyn concede that he understands the scepticism with which CBA's admissions, apologies and commitments to put things right will be met Comyn, who was clearly and quite rightly well prepared and rehearsed, did his best to sprinkle a few examples of what CBA is doing to fix things, including its independently audited response to the banking regulator's report into its culture, its decision (this week) to rebate grandfathered commissions, change remuneration processes and push to extend the government's Banking Executive Accountability Regime (known lovingly in the sector as The BEAR). Comyn also pointed to the $850 million that had been "invested" on customer remediation in its wealth business, although Labor's Matt Keough questioned the use of this term, suggesting, quite rightly, that "remediation can be in no way an investment". Comyn explained that some $400 million had been spent on the administration of the customer remediation program, which adds more evidence to belief that these efforts will be expensive. Hartzer also moved to take ownership of Westpac's mistakes, and despite his previous opposition to the royal commission, said it had been a valuable process that had exposed the breadth of the industry's problems. "It's really clear that we have a lot of work to do to restore community trust" But Hartzer's position was somewhat stronger than Comyn's by dent of the fact Westpac featured much less than CBA during the royal commission hearings. So Hartzer was able to be a touch more forceful about what Westpac is doing in response to the industry's malaise, including having fully implemented the recommendations of the industry Sedgwick report on staff pay two years ahead of schedule, removing grandfathered commissions attributable to BT products, and improving its complaints handling by appointing a new group executive for that function. Where Comyn's tone was one of contrition, Hartzer was prepared to stand up for his bank and his industry. So when Keough turned to the topic of the use of incentives - as he had with Comyn, Hartzer was prepared to fight a little. Keough suggested that the new balance scorecard model that Westpac has adopted - in which financial incentives are balanced with measures around items such as customer services and compliance - was mere "window dressing" that didn't actually move the bank away from financial incentives. Hartzer challenged that characterisation and argued incentives have a role. "We are a commercial organisation. We want to grow. People who represent us, an element of their job is to help us grow the business." The key, Hartzer said, was to ensure that

128 Australian Financial Review, Australia Author: Myriam Robin Section: General News Article type : News Item Classification : National : 44,635 Page: 40 Printed Size: cm² Market: National Country: Australia ASR: AUD 13,794 Words: 1497 Item ID: Page 2 of 3 The key, Hartzer said, was to ensure that there were no "perverse" outcomes from incentives. Continued pl9 From page A bank is no longer about banking Keough was one of a number MPs who relished the chance to do their best impressions of Commissioner Hayne or Rowena Orr QC and find some "gotcha" moments. Labor's MattThistlethwaite probed how the bank had investigated the tampering of accounts for young savers, trying valiantly to trace it to Comyn's involvement- or more accurately, lack thereof- in the investigation of this. At one stage he went down the path of questioning why Comyn was even appointed as CEO in February, given an independent investigation into the handling of matter was not completed until March. This attack was blunted when Comyn said the allegations raised by a whistleblower had been found to lack substance. Keough also tried to suggest that CBA had tried to be tricky with the royal commission when it was first asked to provide it with information on examples of misconduct. It was an easy, but very minor, bit of point scoring. Surely there are bigger issues stemming from the royal commission than its administration? The Liberal Party's Jason Falinski - who opened his questions by disclosing that the CBA had repossessed his family's home when his parent's business collapsed - asked some interesting but muddled questions on the lack of bank competition, particularly in the small business segment of the market Falinski seemed to be suggesting CBA should be criticised for withdrawing from the riskier parts of this market, suggesting the factoring and invoice discounting segment - where interest rates can beashighas40percent-should have been attractive to the bank. Comyn, quite rightly, said there were some areas that the bank doesn't want to play in, and it was not comfortable in segments where rates are that high. Later Falinski asked Hartzer whether Westpac should have been allowed to buy St George during the GFC. Hartzer quickly responded that the bank would have fallen over had the deal not been done. Undeterred, Falinski then asked whether Westpac should have been allowed to continue operating the brand, suggesting - as much as we could understand - that there were too few competitors in the market, but too many brands, which ultimately confused customers. Hartzer seemed as puzzled as we were, but did stand uptofalinski's suggestion that banking margins in Australia were world-leading. It's actually returns on equity that the Productivity Commission has argued are world beating, but Hartzer wisely didn't go there. Labor's Clare O'Neil made poignant and important points about the personal trauma experienced by those who had been mistreated by the banks. Comyn said he would "certainly acknowledge the hurt and the very difficult circumstances of some of our customers" but admitted to O'Neil he had seen fewer than 10 customers face-to-face. Hartzer said he had watched the videos of the Westpac case studies at the royal commission, but later admitted to O'Neil he had not met personally with customers, although his metaphorical door was always open. O'Neil urged Comyn to get out and see more customers, and then named three or four customers who she felt had been badly treated; the format, of course, didn't allow for any of those case studies to be interrogated in detail. It was a neat bit of point scoring, but also neatly illustrative of the dilemma facing Comyn and Hartzer. How do they practically balance fixing the systemic and cultural problems in their banks with the hard work of meeting individual customers, and actually running Australia's biggest financial institutions? Hartzer told the committee that "from an overall reputation point of view this is going to take years to restore". He'sonly half right It could well take generations. JAMES THOMSON CBA chief executive Matt Comyn was more than a little contrite yesterday.

129 Australian Financial Review, Australia Author: Myriam Robin Section: General News Article type : News Item Classification : National : 44,635 Page: 40 Printed Size: cm² Market: National Country: Australia ASR: AUD 13,794 Words: 1497 Item ID: Page 3 of 3

130 Australian Financial Review, Australia Author: James Frost And Tony Boyd Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 15 Printed Size: cm² Market: National Country: Australia ASR: AUD 6,412 Words: 793 Item ID: Page 1 of 2 Sector told to model on professions James Frost and Tony Boyd Australia's top financial regulators have called on the industry to wake up and start acting like professionals as they set about rebuilding the reputation of a sector shaken by a steady flow of stories about misconduct APRA chairman Wayne Byres has asked bankers and financial advisers to act more like doctors and lawyers in the quest to restore trust, while ASIC chairman James Shipton looked to the farming and mining sectors for examples of industries that have overcome adversity. The speeches were delivered at the annual FTJVSIA Summit in Sydney, at the same time as Commonwealth Bank CEO Matt Comyn and Westpac CEO Brian Hartzer withstood a grilling over the misdeeds of the banks at a House Economics Committee meeting in Canberra. APRA's Mr Byres said many finance professionals were not appropriately equipped to deal with the conflicts of interest they faced and said it was time for the sector to step up and take responsibility for it "Medicine is a profession... law is a profession... however, the business of banking, at least thus far, is not a profession," Mr Byres said. Mr Byres said although none of the industries APRA regulated were considered professions, those who worked in finance and insurance could have just as much impact on people's lives as doctors or lawyers, highlighting the need for better qualifications and binding codes of conduct "Where codes of conduct exist they are often totally voluntary. And on the evidence before the royal commission, the balance between self-interest company interest and serving the community's interest has not always been appropriately struck," Mr Byres said. ASIC chair Mr Shipton made a similar point using different industries. He said dairy farmers were a good example of a sector that had the community's trust and confidence while the mining industry was another that Continued p18 From page 15 Sector told to model on professions enjoyed stronger support after it changed the way it operated. Mr Shipton described the Hayne royal commission's interim report as a "blight" on the industry and elaborated on how the financial services industry can get away from Commissioner Hayne's "horrible diagnosis of dishonesty". "Clearly, what has happened is there has been a vacation of responsibility. They have vacated the field to make sure there is sufficient honest conduct inside financial institutions. "That has to be repaired for our system to work - for us to rebuild trust That first line of responsibility needs fundamental repair." Mr Shipton called on industry bodies and associations as well as the 450,000 people working in the financial services industry to meet the challenge by expecting more of themselves and their colleagues. Mr Byres said following deregulation of the sector in the 1980s, the push for higher standards was akin to swimming against the tide, but the time had come for the sector to add an ethical compass to its toolbox. "Professional standards would identify individuals as having appropriate skills and experience. They would ensure ongoing professional development... they would include a mechanism for counselling and, if necessary, disciplining individuals who do not uphold competency and behavioural standards," he said. Mr Byres touched on the "intense glare" of the royal commission, saying while it was uncomfortable for the sector, he had no doubt it would be for the best. He also directly addressed criticisms that the regulators - APRA and ASIC - can and should do more. He said based on what had been revealed, "that is quite a reasonable conclusion" and APRA may need to consider misconduct in a different manner than it has traditionally, which has been as "an indicator of risk". Mr Byres welcomed the use of emerging technologies to help the sector on its path to restoring trust in processes, acknowledging that "human decisionmakers have not covered themselves in glory"; however, he warned technology was no silver bullet "But as much as we can all see the amazing advances in technology, people will remain central to the financial system for the time being," he said. "Computers might help, but for the foreseeable future humans will still... choose which products to offer... determine how they will be distributed, devise the decision rules by which they are sold, and deal with disputes." In concluding remarks from the ASIC chair, Mr Shipton said it was imperative that licensed entities followed the obligation to act fairly, honestly and efficiently. "That is an obligation on you as licensed firms. Section 912a of the Corporations Act is, I am sorry I am a regulator but I have to say it is fundamentally important It's fundamentally important because the diagnosis is in - the diagnosis is that we are not adhering to the bedrock, fundamental, cornerstone obligation that really underpins our entire regulatory structure and financial system."

131 Australian Financial Review, Australia Author: James Frost And Tony Boyd Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 15 Printed Size: cm² Market: National Country: Australia ASR: AUD 6,412 Words: 793 Item ID: Page 2 of 2 Wayne Byres says better qualifications and binding conduct codes are needed.

132 Australian Financial Review, Australia Author: Story Patrick Durkin Illustration Simon Letch Section: Boss Article type : News Item Classification : National : 44,635 Page: 20 Printed Size: cm² Market: National Country: Australia ASR: AUD 29,126 Words: 2060 Item ID: Page 1 of 3 TAMING THE PAY MONSTER Executive remuneration has hecome so complex, few can decipher it. But there is furious dehate on how to make it simpler. STORY PATRICK DURKIN ILLUSTRATION SIMON LETCH Did Domino's chief executive Don Meij really make $37 million last year, as outraged headlines screamed? Or was it the $4.66 million reported in the pizza giant's annual report? Or somewhere in between? Did Qantas CEO Alan Joyce's pay packet really fall from $24.6 million to $10.87 million this year or stay largely flat at about $7.7 million? Or was his take-home pay last year $11.25 million, as other reports suggest? The banking royal commission has shone a harsh light on the role of remuneration, commissions and incentives, with repeated examples of staff and executives putting sales targets and bonuses ahead of customers' best interests. "Show me the incentive and I will show you the outcome," Warren Buffett's business partner Charlie Munger famously said. But to fix executive pay, first you have to understand it - much easier said than done. The mathematicians who developed models such as the "Monte Carlo" and "Black-Scholes" for calculating executive pay have won Nobel prizes. Remuneration consultants have been labelled masters of a black art. If Labor wins the next federal election,

133 Australian Financial Review, Australia Author: Story Patrick Durkin Illustration Simon Letch Section: Boss Article type : News Item Classification : National : 44,635 Page: 20 Printed Size: cm² Market: National Country: Australia ASR: AUD 29,126 Words: 2060 Item ID: Page 2 of 3 Australia seems certain to follow Britain with tougher rules such as the publication of ratios of CEO pay to average employees. ALP president Wayne Swan is also calling for caps on CEO pay, despite research revealing this country's CEO pay levels are modest by global standards and a string of new CEOs being appointed on lower pay than their predecessors. Australian Prudential Regulation Authority chairman Wayne Byres warns that bank pay is tied to the wrong metrics, with reliance on return on equity (ROE) and total shareholder returns (TSR) no longer appropriate. The push for stronger claw ofbonuses-to stop executives walking away with millions before scandals are exposed - is also gaining momentum. Ken Dean, a director at BlueScope Steel, Energy Australia and Virgin Australia, defies anyone to properly understand CEO pay. He describes it as some kind of Frankenstein monster that has had many bits added over time, as different investors have demanded different models. Each change takes three or more years to work through the system. "Managements [and] boards have been responding to pressure to make remuneration reflective of shareholder interests or stakeholder interests generally," Dean says, "and every time you do that and you introduce some other component, be it short term, long term [or] multiple aspects ofscorecards in relation to both of those. It does get tremendously complex." The latest trend, led by big companies such as Telstra, QBE.Wesfarmers, AMP, Perpetual and this year National Australia Bank, JB Hi-Fi and isentia, is to collapse short-term and longterm incentives into a single variable model to try to simplify executive pay. In this structure, so-called balanced scorecards - the gateway for determining how much of the bonus pool executives receive - have been hailed as the new elixir. WHAT WAS DON MEIJ PAID? HM 2017 Base pay (cash) 1049 Cash bonus Long-term incentive 3567 Other 46 CEO reported pay 4662 SOURCE: ANNUAL REPORTS, ASX (377) In his interim report from the banking royal commission, Kenneth Hayne says scorecards might be one step towards tackling cultural change, but "do not complete that journey". He notes that all the major banks use scorecards, but warns that incentivising good conduct may be more important than penalising bad behaviour, and questions the basis for sales-based incentives that encourage staff to put profits before people. Scorecards have triggered a fresh debate over some of the non-financial targets around culture and diversity, which are hard to quantify and seemingly easy to achieve. The single variable award structure had a bad start, with insurer QBE, financial services group AMP and business services software provider MYOB suffering protest votes from investors. NAB looks set to follow the CBA, which in 2016 became the first bank to have its "people and community" bonus voted down. IAG's potential $2.55 million bonus, paid in part if CEO Peter Harmer demonstrated the "IAG spirit", was another non-financial target that irked investors. "It's fair to say... not everyone has said to! us 'we are fully supportive of this'," says NAB i chairman Ken Henry, who argues the change i gives the board more control over long-term i incentives and gives executives more skin in the game. "Some still have questions about it." j Investors warn these so-called hybrid I models often determine the number of shares i or performance rights issued over a one-year! performance period, even if the shares vest I over subsequent years, and remove the old long-term incentive (LTI) performance hurdles i that had to be hit before stocks vested. The Australian Shareholders' Association I CEO Judith Fox warns: "ASA is of the opinion I that it is not a true LTI." I There is also scepticism about the motives i for the move - no long-term shares vested for NAB executives in 2013,2014,2015 or 2016! because the bank failed to achieve its relative TSR performance hurdles. And these hybrid structures are not catching I on overseas - another alarm bell for investors. LACK OF TRANSPARENCY I Investors remain more comfortable with i traditional hurdles such as ANZ's performance I rights, which are tested on TSR hurdles at the end of three years for short-term incentives (STIs) deferred over four years. Big investors such as the Future Fund and the country's two major proxy advisors, CGI Glass Lewis and ISS, warn that NAB executives - who will be eligible for 40 per cent of the pool as cash each year and the other 60 per cent as deferred shares over four years - are likely to end up better off. Joel Posters, head of investment at the Future Fund, says: "By basing executive remuneration on performance over only a one-year period, these new structures appear to head in the wrong direction." This is the case even if the shares vest over three or more years. CGI says before it even thinks of supporting these hybrid models, the vesting period should be at least five years (including the initial oneyear performance period), a significant discount rate should be applied to the "at risk" pay and an appropriate long-term target imposed. Matt Christensen, global head of responsible investment at 745 billion-euro fund manager AXA Investment Management, says the problem is a lack of transparency. Remuneration accounted for 68 per cent of AXAs votes against management in Australia, compared with 42 per cent in the Eurozone, 26 per cent in Asia Pacific and 24 per cent in North America.

134 Australian Financial Review, Australia Author: Story Patrick Durkin Illustration Simon Letch Section: Boss Article type : News Item Classification : National : 44,635 Page: 20 Printed Size: cm² Market: National Country: Australia ASR: AUD 29,126 Words: 2060 Item ID: Page 3 of 3 "The current situation is opaque," he says. "Trying to understand how executive reward and company performance come together is still not clear." Meij's pay at Domino's is a perfect example of the complexity. The Australian Council of Superannuation Investors (ACSI), in its annual report on CEO pay prepared by shareholder proxy firm Ownership Matters, calculates that Meij's "take-home" pay in was $36.8 million, with options, rights and shares the big wild card. Meij's reported pay was $4.7 million but the value of options exercised was $35.7 million (less $3.6 million for sharebased payments expense). Groups such as ACSI argue that CEO pay is often under-reported. Meij's options were valued at $ 1.9 million when they were granted which, under the accounting rules, is the value that companies are required to report. Many leading companies now also disclose take-home or realised CEO pay, which takes in the current value of the options and shares. Domino's points out that in 2013, shareholders overwhelmingly approved the grant of 1 million options to the CEO. The first tranche of 600,000 granted in September 2014 (with a fair value at grant date of $7.16) vested on September 1 last year with an exercise price of $ Meij exercised those 600,000 options last year when the share price had hit a remarkable $74.47, delivering a huge windfall gain. BOSS calculates that for , Meij's takehome pay was $13.9 million, with the value of 300,000 options exercised at a cost of $6.9 million and worth $12.7 million. But the practice of awarding shares and options reflects a big push after the global financial crisis to align pay to performance. A recent panel of local fund managers that BOSS attended singled out how much they liked Domino's pay structure because it gives executives "skin in the game". WHATWAS ALAN JOYCE PAID? Base pay (cash) Cash bonus Share bonus Long-term incentive Other CEO reported pay Total realised pay SOURCE: ANNUAL REPORTS. ASX ,584 $'000s jfl (62) ,869 I The CEO is paid a lot only when investors do! well. Meij's pay was high because his share price I i shot the lights out - a 400 per cent rise in just i over three years. It is a similar story with Qantas CEO! Alan Joyce, whose controversial $25 million I "take-home" pay last year reflected the first i substantial vesting of options under Qantas'! long-term incentive scheme in many years. He I I received 2.19 million in rights in August 2015 I after 97 per cent of Qantas shareholders voted! to award Joyce $4 million in equity incentives as part of a three-year incentive scheme if he I could turn the share price around. The airline's share price jumped from I $1.26 on June 30,2014, to $5.72 on June 30 i last year. The $25 million included those! $4 million shares which, fully vested, had I risen by $14.5 million in value after Qantas hit all its targets, and the shares were the best i performing in the ASX100, as well as the best I performing in a global listed airlines peer! group over the period. Wesfarmers chairman Michael Chaney! says part of the public's anger is because the I annual cash bonus (or short-term incentive)! has become virtually guaranteed pay "Thirty i years ago, bonuses were bonuses and were I paid for out-performance," Chaney says. "Over ] I time, however, 'short-term incentives' became j i expected remuneration at their 'target' level." ACSI agrees, arguing that "a CEO is now! more likely to lose their job than their bonus" The head of investor Allan Gray, Simon I Mawhinney - who manages more than YOU GET CEOS WHO STAND TO BONUS IF THEY DON'T KILL ANYONE." SIMDK MAWHINNEV. ALIAN CRAY $4 billion in funds - says CEOs should lose pay, rather than receive multimillion-dollar bonuses for meeting non-financial targets, such as safety. "The one I find most difficult to swallow is that you get these CEOs who are paid $10 million but stand to earn a 50 per cent bonus if they don't kill anyone," he says. Wesfarmers argues its new hybrid model is working. Executives have paid the price for Bunnings' failed foray into Britain and Ireland, underperformance at Target and weaker earnings at Coles, forgoing $17 million of rewards this year. Despite investor scepticism, more boards are moving to the hybrid model, and the director community seems convinced. "I am hoping we're going to see more simplification," says Sally Pitkin, chair of Super Retail Group. "We are seeing some companies looking to try to bring their short-term and long-term incentive plans together in a more simplified model, and so companies are trying to investigate how we can do it better and more simply." Whether this so-called simplification really works will largely depend on the rigour of these new balanced scorecards. But a closer look shows just how complex things can get. Half of the Qantas scorecard is based on underlying profit before tax. Last year's $1.4 billion "exceeded the target, but was less than the maximum". The other 50 per cent is made up of five factors including non-financial targets relating to people and operational safety as well as a customer metric, based on net promoter score. Investors remain concerned these softer targets are too easily hit and no longer trust boards to safeguard their interests. Joyce's scorecard result last year was 128 per cent out of a possible 200 per cent - injected into an equation against his base pay to deliver a $3 million bonus. At the core of the NAB scheme, unveiled in September, is a balanced scorecard that has equal weighting for each of its five elements. Executives will be measured against a risk objective, which is required by APRA, a customer objective, which uses a net promoter score, product simplification, business transformation and three financial metrics: cash earnings, return on equity growth and a board-approved capital plan. We should know in five years whether this promised simplification has worked or is just the latest fad. Sceptics think they already know. ZZ BOSS OCTOBER 2018

135 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 1 of 7 L E A D E R S H I P F O R G 8 0 W 1 B FINANCIAL REVIEW October 2018, Volume 19 AFRBOSS.COM.AU TAMING THE BEAST Investors on the warpath over executive pay LINE OF FIRE Why this AGM season is shaping up to be ugly LET'S GET DIGITAL Sam Walsh's vision for the future of arts funding

136 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 2 of 7 14 BOSS0CT08ER 2018

137 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 3 of 7 COME TOGETHER After years of turmoil at Australia Post, chief executive Christine Holgate is on a mission of healing. Christine Holgate describes her MO as "tough love". hen Australia Post's new boss, Christine Holgate, arrived at Melbourne Airport's mail sorting plant with her mum and a Buddhist monk to bless the building and workers, "jaws dropped", according to those present. The 70,000 staff, licensees, mail contractors and delivery partners had just endured eight years of service cuts, retrenchments, price increases, asset sales and union warfare under the highoctane Ahmed Fahour. The former chief executive had been charged with turning the business around, but it came at the cost of a constant state of i upheaval. He got the mail carrier into the [ black, but left staff morale battered. The switch to the spiritual, vegetarian, I former CEO of vitamins-maker Blackmores, j who took a pay cut and trekked to a Buddhist I temple in Bhutan to clear her mind before j starting the enormous role, was so stark, many I weren't sure if Holgate was the real deal. As Holgate toured the country to meet I staff, she faced a sceptical workforce. At one memorable town hall gathering in Perth, the new CEO was put on the spot about the topic deeply dividing her company. "Red or blue?" one burly West Australian worker asked bluntly, amid a sea of blue StarTrack uniforms. The question went to the heart of concerns that Australia Post had become two businesses: the profitable parcel delivery service StarTrack, with its blue logo and livery, versus the traditional letters and postal network in red. The network was losing millions and staff were "genuinely concerned" StarTrack would be spun off and privatised. "Red," Holgate said after a pause. "You f ing beauty," the worker shot to public cheers. Holgate's response told staff everything they needed to know. Community surveys show Australia Post remains one of the most valuable brands in the country, with its contribution to the economy valued at $6 billion, according to Deloitte. Holgate has decided to lose the blue corporate colours of StarTrack and bring the business under the Australia Post name and colours, as she seeks to leverage the brand : : I Stay in the black and grow the business. I Save costs including using more posties to deliver parcels and use of automation. I Invest more in services such as Uber-like tracking, improving rural post offices and IT systems, to be able to offer more attractive services to the banks and Amazon. I Lift net promoter score from 21.4 and staff engagement from 60 per cent, and bring the delivery service StarTrack under the Australia Post name and colours to unite the staff and win the trust of the government and the public. I Win the trust of the unions ahead of a new wage agreement being negotiated in 2020.

138 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 4 of 7 and unite workers and the public. "There was a genuine fear prior to me joining that the company would split in two," Holgate tells BOSS from her top-floor office at Australia Post's headquarters in Melbourne, near the top endofbourkest. "The delivery people told me we are like two companies, one red, one blue. We have to come together as one." Holgate has launched an advertising campaign, "Everyone Matters", which highlights regional post offices, caring postmen and support for small business. Morale has soared, with the carrier's net promoter score jumping by more than 30 per cent in six months. Spending more to expand the business is high risk, and Holgate is still in her honeymoon phase. But she firmly believes that rebuilding the public's and workers' trust in the brand will grow the business. "We have to be viable and we have to grow," she says. Holgate is moving to save the humble posties, who deliver 40 per cent of Australia Post parcels. The plan is to hit 50 per cent this financial year so the posties can pick up the growth in the parcels business. "[This] not only saves us money but means the most trusted person is coming to the front door, and so we are securing those jobs," she says. "We have such a large workforce that knock on the home and doors of business every day," Holgate says in her northern English accent. "If those people aren't walking in the door loving their job, if they are feeling, 'Oh another negative story about Aussie Post in the newspaper,' how can they feel proud, how can they love their job?" There are questions from some quarters about whether Holgate could be a soft touch. But don't be fooled by her talk of love, spirituality and friendly persona. She developed her street smarts young and can clearly be tough and determined. She tends to push until she succeeds. "I'm into fairness, not kindness. It is not just about telling people what they want to hear," Holgate says. "One of my old bosses read a story about me when I was joining Australia Post and said: 'They clearly don't know you very well. You're tough love.'" Holgate left her rural home in Cheshire for London at 18 after friction with her father during her rebellious phase as a punk rocker, complete with shaved head and pierced nose. Christine Holgate as Blackmores CEO, with company chairman Marcus Blackmore. At church in London, she met her elderly "guardian angel" named Flo, who helped her get into and pay for a business degree at the University of North London. From there Holgate launched her executive career, which took her around the globe. The lifestyle was inspired in part by her glamorous aunt who had no children, drove an MG car and with whom she lived between the ages of 11 and 14. Holgate thought she was "amazing". "When you have not had a lot, you are perhaps a bit hungrier than people around you who seem very comfortable. You are also FROM RURAL ROOTS TO CEO Grows up in a small farming community n Cheshire, England Moves to London at age 18; meets her "guardian angel" Flo, who helps her get into university Completes post-graduate diploma in management studies; goes on to complete MBA in : 2008 Moves to \ Appointed Australia. I CEO of Begins working \ Blackmores. as Telstra business and marketing j««"i««^.jk director; rises v, ^ _4"W to business i *^' * managing S\m~ ' director. T^r V H 2010 Appointed a director of Ten Network Holdings (until December 2015) First woman voted CEO of the year by the CEO Institute and CEO Magazine; appointed inaugural chair of the board of the Australia- ASEAN Council Marries Michael Harding, chairman of Downer EDI, in England; appointed a director of Collingwood Football Club Takes time out at a Buddhist monastery in Bhutan before beginning as CEO of Australia Post on October BOSS OCTOBER 2018

139 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 5 of 7 prepared to step out of your comfort zone because you think what is the worst thing that can happen?" Holgate's tough love has included a shake-up of executives and pay at head office, with Andrew Walduck and Christine Corbett departing and former head of people Chris Blake - one of the last remaining appointments by Fahour - taking a lesser role. CUSTOMER NEEDS She has brought in Deutsche Post executive Ingo Bohlken, NewsCorp executive Nicole Sheffield and Linfox executive Annette Carey to focus on customers and innovation. Holgate is critical of a "fragmented" approach that created a "strong leadership bias towards products, which has served us well building our parcel business, but has diluted the focus on the needs of our customers". Holgate's salary this year was $1.7 million - she says she never took the job for the money - compared with Fahour's $5.6 million salary and $10.8 million payout, which sparked his surprise exit amid controversy early last year. (Fahour was recently appointed chief executive of consumer finance business Latitude Financial Services.) Still, concerns have been expressed about Holgate acceding to a campaign from the unions on equal pay for equal work, and fears that she could "blow the budget". She brings the pay issue to trust. "This man said to me, '1 go to work and this other man sitting next to me goes to work 15 minutes later but I am paid 15 per cent more.' "If you do not address basic things like pay, I will never win their trust and I need their trust, I need their respect and I need their engagement," she says, quoting advice from trucking magnate Lindsay Fox. The Victorian state secretary of the Communications Workers Union, Leroy Lazaro, says of Holgate: "Christine is everything the previous CEO was not." The union, whose former state secretary labelled Fahour "pretty ruthless" and who alleged that the former CEO fired an executive at the behest of certain factions in the union, is smitten with Holgate, although the relationship will be fully tested in 2020 when a new enterprise agreement is negotiated. Holgate's emphasis on trust is notable in an era when trust in business is at record lows. AustralianSuper boss Ian Silk notes that Holgate puts a huge premium on personal and organisational trust. "Christine is one of the most talented chief executives in the nation," Silk says. "I've seen her with her exec team at Blackmores, and also addressing a town hall meeting of hundreds of her factory workers. She was equally at home in both environments, and the respect both groups had for her was palpable." Trust was also a factor in her appointment as CEO of Blackmores in 2008, which coincided with the death of her sister - whose two boys have been a big part of her life - and a close friend to cancer. "I called [founder] Marcus [Blackmore] after our first interview processs and said, 'You're a strong personality I'm a strong personality. Before we go through any more interviews I think we should get to know each other and! see if we actually like each other.' I said, 'By! the end of one whole day together, we will know if we believe in the same things and view I individuals the same way.' "When I got to his office he has this picture up on his screen of a very young, handsome,! half-asian man. It was his son that his EA I and staff didn't know about. He said, 'I knew I needed to tell you something to let you know you could trust me.'" Blackmore tells BOSS that Holgate is "very I caring, altruistic, ambitious, a very up-front I sort of person and smart as hell". He says I she would make a good United Nations i ambassador. She was also popular with staff. "She had more farewells than Dame Nellie! Melba," he laughs. The partnership delivered gold - the i Blackmores share price rose from $ 13 to more i than $200 during Holgate's nine-year reign, Holgate with her mother and two nephews - the sons of her late sister and a big part of her life.! The tale in the mail Profit/loss after tax (Sini Ilions) F 15 FY1B FY17 FY1 Domestic and international volume (millions) FV14 FY15 TOE Fli? LETTERS FY14 FltS HflB FT1? Fli BOSS OCTOBER

140 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 6 of 7 How would you describe your leadership style? Open, tough and fair. Tough love. What would you tell your younger self? Have a go. Most important question when hiring? Values. When do your best ideas come? Sitting in the bath. What office habits annoy you? Meetings. Early riser or night owl? I Probably both. I go to bed at midnight and get up at 5am. \ Favourite holiday spot? Pearl Beach, on the NSW ; Central Coast, and Aldeburgh I in Suffolk, England. I Last good book, podcast or film? I am reading a great book on! Robert Kennedy's speeches i at the moment, j How do you unwind? My favourite thing is going! to watch Collingwood. And! I walk. I also love reading! newspapers from all over the i world. I am always reading.! and made her more than $4 million in shares - but Holgate has remembered the importance of trust in her role at Australia Post, where she marks her one-year anniversary this month. "From day one I put my on the company website," she says. "I want everyone to know they can always reach out to me. It doesn't mean I will always agree or say yes, but it is important to listen." Despite the positive testimonials, the 54-year-old Holgate knows the challenge is immense. Australia Post's $134 million profit remains razor thin. Letter volumes are falling 10 per cent a year and costs are rising while prices remain fixed by law. The letters business made a $180 million loss last year, even after the business received a $26 million bump thanks to the government's same-sex marriage postal survey. Parcel volumes have been growing at record rates - including a 46 per cent rise in the year to June for inward parcels, mainly from China. The parcel business makes up more than half of Australia Post's $6.9 billion revenue. But Holgate warns the parcel business is fiercely competitive, and that inward and outward parcels have slowed dramatically over the past few months as house prices fall, the Australian dollar softens, GST is introduced on low-value goods and Canberra politics have "rattled" consumer confidence. Despite the financial pressure, Holgate is choosing to invest in the business to make I want everyone to know they can reach out to me. It doesn't mean I will always agree or say yes, but it is important to listen. The Australia Post CEO has become a diehard Collingwood supporter. it grow, including spending $300 million on automating its main parcel processing facilities and Uber-style tracking capabilities. "To persuade more people to give us their parcel, we have to be the best," she says. "What we have to do is demonstrate a bigger commitment to customer service and trust, [and] part of that is investing in tracking capability and automation." Her strategy could come unstuck if financial pressure grows and the move to more automation triggers big job cuts. Holgate is also betting that banking services can offer an enormous opportunity. The big four banks shut 500 branches over the past few years, with another 1000 branches slated to be closed. There are 1550 communities in Australia where there is no bank but there is a post office. "We can become the teller of the nation," Holgate says, meaning Australia Post expects to be paid for providing services for the major banks rather than applying for a bank licence itself. Holgate says the banks are underpaying the organisation by about $100 million for services it already provides, but that Australia Post is in talks with the big bank CEOs and is close to a breakthrough. AMAZON OPPORTUNITY Holgate is careful when discussing Amazon, which is seen as a threat and an opportunity for Australia Post. Amazon is partnering with Australia Post for the moment but if the US giant were to switch to another provider, it could do real damage. Australia Post has also launched its own subscription service called Shipster to provide free shipping to customers and help local retailers compete with Amazon online. "I have always been a friend of Amazon," Holgate says. "In Australia, e-commerce is still only about 8 per cent of retail sales. In the UK it's 20 per cent, and Asia it's 50 per cent. "Amazon has difficult relationships with postal services around the world, including the US and UK, but in many markets like Canada

141 Australian Financial Review, Australia Author: Christine Holgate Section: Boss Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Market: National Country: Australia ASR: AUD 78,742 Words: 3322 Item ID: Page 7 of 7 they have a very successful relationship, so I think we have to try and be a good partner to Amazon. Who else is going to go the last mile in Australia? The geography is not like the UK." Holgate is also still bullish on Asia, which drove the success of Blackmores and almost became her home before former Telstra CEO David Thodey offered her a job in Australia. When Thodey approached her, she was about to return to London after a short stint working in Poland. "It was November 2002 and David was the CEO of Telstra mobile. David said: 'I would love you to come and do this job for me.' I was also offered a job in Hong Kong, which I turned down, but then Telstra reorganised so the job no longer existed. "I remember David called me one Friday night and said, '1 have a new job for you. You probably won't want to do it because it is much more junior.' I was meant to fly from Poland, where I was working, to London on the Saturday morning and instead bought a ticket to come straight to Australia. "On the Tuesday he called me at the set time and I said, T am outside your building. Can I come in?' He said, 'What are you doing here?' and I said, 'Well, I've decided you should just give me the job.'" Holgate's international career sent her to Europe, the Caribbean and Hong Kong, including executive roles at Cable & Wireless, JP Morgan and the doomed British telco Energis. Her name came up for the Australia 2018 SNAPSHOT SOURCE: AUSTRALIA POST Post job not long after she had presented to its leadership group - including chairman John Stanhope, who Holgate knew from her Telstra days - and the board had to quickly find a replacement for Fahour. After marrying EDI Downer chairman Michael Harding, who also hails from Britain, in 2016 in Aldeburgh, Suffolk, Holgate finally seems to have settled into the role she has been building towards. Collingwood president Eddie McGuire has even convinced her to become a "one-eyed" Pies supporter in the AFL He first asked her to join the Collingwood board after presenting her the award for CEO of the Year in He texted on her wedding day to ask: "Is today the second time you say I do?" Having just stepped off the Ten Network board, where she sat alongside the likes of Lachlan Murdoch and Gina Rinehart, Holgate accepted and has grown to love the game. She still lives in Sydney's Mosman and has a $5 million holiday house in Pearl Beach on NSW's Central Coast, but spends her week at the Melbourne's Grand Hyatt, so she can focus on work and avoid the distraction of domestic duties. (See story right.) "Right now, what is really important to me is giving everything to this company. It needs it, our workforce deserves it and so do our customers. They really look after me and I feel safe there. I just walk here, I don't waste time and I can focus on the job." 1.3M Parcels delivered daily r , 1AM NOT VERY GOOD AT COOKING AND IRONING' Christine Holgate lives in the Grand Hyatt in Collins St, Melbourne. She still has a family home in Sydney's Mosman and a $5 million holiday house in Pearl Beach on NSW's Central Coast, but spends her weeks in Melbourne, close to the headquarters of Australia Post on Bourke St. Holgate loves it because she doesn't have to worry about domestic duties and can just focus on the job. She isn't the first female CEO to think of the idea: Coca-Cola Amatil CEO Alison Watkins did something similar when she was working at GrainCorp. "I am here [in Melbourne] four days of the week," Holgate says. "I know all the staff and it is like home. At first I thought I would hate it and everyone said 'Don't do it!' But it's fantastic. I got home at 9.30 last night and I wanted something to eat, and they made me a cheese toastie. "I want my laundry done, I call them in the morning and say 'Could you do my laundry today?' I am not very good at cooking and ironing." Holgate thinks one of the problems for people in today's world is working out where to direct their focus. Spending her work week living at the hotel "takes away the clutter". "I am not allowed to tell you the rate but the Grand Hyatt have given me a great rate and actually I could not rent a one-bedroom apartment around here for that," she says. BOSS OCTOBER?0ie 19

142 Australian Financial Review, Australia Author: Sally Patten Section: Boss Article type : News Item Classification : National : 44,635 Page: 4 Printed Size: cm² Market: National Country: Australia ASR: AUD 4,612 Words: 321 Item ID: Page 1 of 1 EDITOR'S LETTER FINANCIAL REVIEW Find us online at afr.com.au/boss or in the Financial Review ipad app. Executive remuneration is a perennial thorn in the sides of directors and investors. It is also something of an obsession. The 2018 annual report of mining behemoth BHP mentions the word "remuneration" no less than 486 times. Little wonder that remuneration models ebb and flow as shareholder and community expectations change. The only constant seems to be that the models have become ever more complex. Five years ago, total shareholder return was pretty much the only determinant of executive bonuses. And in the olden days, bonuses were just that. Now, short-term incentives are almost part of fixed pay and the strong preference is to use so-called balanced scorecards, which take in objectives such as safety, customer satisfaction and diversity as well as financial measures. But, as one shareholder points out in Patrick Durkin's feature on page 20, it is a touch galling when a CEO earns a bonus for not killing anyone. Trust is a bit of a theme of this issue. Sadly in corporate Australia, there is not much of it about and so we take a look at some of the elements that can help to foster that trust. Ensuring executives are given the appropriate financial incentives is one, and then there is the monitoring of community standards, operating in a way that meets those standards, creating partnerships and making sure you are qualified to deliver on your promises. Australia Post chief Christine Holgate falls nicely into the discussion of trust. AustralianSuper boss Ian Silk notes that Holgate "puts a huge premium on personal and organisational trust", and indeed she puts much emphasis on the need to build the trust and respect of the organisation's 35,000 employees. If you are after a few fun facts to brighten up your day, head to page 26. How many sausage rolls and party pies does it take to cater for hungry shareholders at the conclusion of the annual meeting? Sally Patten

143 Australian Financial Review, Australia Author: Dominic Lorrimer And Elke Meitzel Section: Boss Article type : News Item Classification : National : 44,635 Page: 28 Printed Size: cm² Market: National Country: Australia ASR: AUD 41,930 Words: 2700 Item ID: Page 1 of 4 In a fast-changing world, companies are increasingly in search of fresh thinking and fresh approaches to give them the edge over competitors. In a duopolistic market such as Australia, a key way to achieve this can be recruiting executives from different industries. Anecdotal evidence from executive search firms suggests that more and more companies are doing just that. "Companies are trying to give themselves the edge with people who look at a problem from a different angle," says Robert Webster, a senior client partner at executive search firm Korn Ferry. "It has really taken off over the past 10 years with the digital revolution. People are more inclined to look for new thinking." Guy Farrow, managing partner of search firm Heidrick & Struggles in Sydney, adds: "There's a recognition that you're better off thinking more laterally. If you look globally, one of the things that has changed dramatically over the past 10 or 20 years has been the portability of talent. That is across countries, but it's also between industries." Gregory Robinson, managing partner at executive search and board advisory firm Blenheim Partners, says: "Some organisations have come to the conclusion [that employing] everyone from the same industry is not an answer against new entrants or offshore players and have deliberately avoided their sector as an executive hunting ground." Webster notes that the banks have been successful in recruiting executives from other industries, partly because they have a huge appetite for IT and digital skills. One of the most high-profile shifts was Maile Carnegie, who in early 2016 quit as managing director of Google in Australia to become group executive of digital banking at ANZ Banking Group. Rob Coombe says he couldn't have gone into a more dissimilar industry when he switched from banking to fast food. "Part of Maile's role will also be to shift our thinking and champion a groupwide innovation culture at ANZ based on developing and attracting servicefocused, technology-literate, innovative and experimental people and teams," chief executive Shayne Elliott said at the time. Robinson points to other notable examples: Greg Barnes, who in 2016 moved from chief financial officer at building products company CSR to Nine Entertainment; Andy Penn, who switched from insurance group AXA to Telstra, where he is now chief executive; Christine Holgate, who went from health supplements company Blackmores to Australia Post; and Gordon Ballantyne, CEO of Healthscope who was previously at Telstra. Changing industries at the CEO level is the exception rather than the rule. Analysis of the 50 biggest companies in Australia by Heidrick

144 Australian Financial Review, Australia Author: Dominic Lorrimer And Elke Meitzel Section: Boss Article type : News Item Classification : National : 44,635 Page: 28 Printed Size: cm² Market: National Country: Australia ASR: AUD 41,930 Words: 2700 Item ID: Page 2 of 4 & Struggles shows only one chief executive, Sydney Airports boss Geoff Culbert, moved industries. Culbert was formerly CEO of GE Australia, an industrial solutions company. NOTABLE EXCEPTIONS Outside the ASX50, other notable exceptions include Alison Watkins, who took up the reins at Coca-Cola Amatil from GrainCorp, and Jayne Hrdlicka, who moved from running discount airline Jetstar to head A2 Milk. But further down the corporate tree, it is far more common. Of the 34 chief executives of ASX 50 companies who were internal appointments, 30 per cent changed industry when they originally joined the company, analysis by Heidrick & Struggles shows. Financial services is a popular hunting ground, with the chiefs of telecoms behemoth Telstra (Andy Penn), property group Scentre (Peter Allen), conglomerate Wesfarmers (Rob Scott) and property developer Lendlease (Steve McCann) all switching out of that sector. Farrow says the opportunity to inject external talent is in the senior leadership team, or "CEO minus one" level. The quid pro quo is that the new employer invests appropriately in the outsider. As another senior executive recruitment expert says: "There has to be an investment of time by both the company and its clients." There is reason to be sceptical that bringing in talent from a different industry will solve a company's problems. More than one expert in the field points to Andy Hornby, a British food retailer who went on to run HBOS, one of Britain's biggest banks, which nearly collapsed during the financial crisis. "It can be a very positive experience to have a fresh set of eyes," says Carol Lewis, director of global executive search firm Stanton Chase. "But it can be a minefield. The question is whether an organisation's culture allows it to be successful." She says management needs to the new recruit into the role, and the appointment needs to be explained to team members, because it can lead to resentment. The executive needs to have a solid 90-day and 180-day plan to track his or her performance and measure success. "Until they have earned their stripes, there is often scepticism about what they can do and what they can deliver." GAME 34 Number of internally appointed CEOs in ASX 50 9 Number of internally appointed CEOs in ASX 50 who changed industry when they joined the company 3.5 Average number of years spent by internal candidates in the role immediately before being appointed CEO Source: Heidrick & Struggles ROB COOMBE Switching from banking to fast food initially felt like biting off more than he could chew. Rob Coombe winces when he thinks to his first few months running fast-food chains. In mid- 2013, Coombe was appointed chief executive of Craveable Brands, a private-equityed business that operates 600 fast-food restaurants, including the Red Rooster hamburger and Oporto chicken chains. Coombe's previous job was running Westpac's retail bank, and before that he spent six years running Westpac's wealth arm. "I was quite taken a, actually. It was quite a difficult transition for me," Coombe says from his Sydney city office. "You couldn't think of two businesses more dissimilar. Even though structurally they had similar functions, the nature of the work is completely different." Jumping sectors also meant Coombe was leaving behind a network of colleagues and contacts built up over 30 years, which made hiring talent more difficult, as well as a dearth of people off whom he could bounce ideas. From the outset two key differences between the industries struck Coombe, who now chairs Craveable Brands. The first was the calibre of the employees. Whereas high pay packets tended to attract talented people to the financial services industry, the same could not be said of the fast-food business. "In this industry, the stores are basically run by kids. The average age in a store is about 17 and people aren't doing it for a career either," Coombe says. "The difference between motivating someone and leading someone who's well educated and trying to build a career, as opposed to kids that are doing it part-time, is quite big." POSITIVE FEEDBACK Coombe set about improving communication by setting up a closed Facebook page and moving all staff training and learning and development onto mobile phones. He also found that Millennials appreciated acknowledgment. Coombe started sending cards to staff members who had been the subject of positive feed over the group's online channels. "When I'd go around the stores, I found - I much to my delight - that the kids were all i posting them up on the noticeboards in the store," he says. "They were really proud of it." The second key contrast was the importance I of marketing. Back in the banking world, I Coombe had all the names and contact details I of his clients, who provided the business with a i steady revenue stream in the form of mortgage I payments, loan repayments, insurance premiums and superannuation fees. In the! food business there was no luxury of long- term, sticky customers. "The importance of marketing was of a! quantum difference than it was in banking," I Coombe says. "The calibre of marketing is infinitely better than anything I've ever seen in! financial services. "[In financial services] the desire to attract new customers is actually not that strong. I Whereas, in the food business, you live and I die by transactions that are happening on a daily basis." The former banker says the key skills I he acquired were digital marketing, the! importance of location, the science of building I good-looking stores on a limited budget and I running effective supply chains. j SOUNDING BOARD j So, what advice would Coombe give others i considering a big switch? "I think the thing that helped me I unequivocally more than anything else was 1 [finding someone] I could use as a sounding I board. If you're going to do it, try to find out I who those people are that you can go to. I I think having access to those individuals fast- I tracked my development. What took me six months to get up to speed could have taken I me eight, nine months and that's too long." Coombe found three people he could I confide in: Gordon Cairns, Wbolworths chairman and former Craveable Brands chair,! and Bob Mansfield and Peter Bush, both I former CEOs of McDonald's Australia. "I think the only other thing would be, if it is i a new industry, just take at least three months I before you tell people what you're going to do. i My instinct was to try and get that out earlier than that [but] you don't really know what I needs to be done until you've fully immersed! yourself into a new industry. "So, make sure you buy yourself the 100 I days. People want you to come in with a 100- i day plan. If it's a new industry, you can't have I that 100-day plan until you've done 100 days."

145 Australian Financial Review, Australia Author: Dominic Lorrimer And Elke Meitzel Section: Boss Article type : News Item Classification : National : 44,635 Page: 28 Printed Size: cm² Market: National Country: Australia ASR: AUD 41,930 Words: 2700 Item ID: Page 3 of 4 PIP MARLOW After 21 years at Microsoft, a move to Suncorp required some big adjustments. Pip Marlow, chief executive of customer marketplace at insurance and banking group Suncorp, had spent 21 years at Microsoft. Her entire working career had been in information technology, but after six years as managing director for the global software and electronics behemoth Marlow knew it was time for a change. She didn't want to head offshore with Microsoft, and taking on a more global role from Australia did not appeal. "I wanted it to be another chapter, and I thought if I'm going to do another chapter, I'm going do a really different chapter. And I wanted ASX. I wanted to work for an Australian company. I hadn't really done that," she says. "I wanted to work for a company I felt aligned to values-wise." And she knew she wanted to join a senior leadership team, reporting to the chief executive. By and by, Marlow met Michael Cameron, Suncorp's CEO. "When I spoke to Michael, he was looking for somebody who wasn't banking and insurance. He was ahead of me. He was already like 'I have banking, I have insurance. I want customer, I want digital, I want change and transformation.'" Marlow made the move in March 2017 and now heads a team that takes in distribution, customer strategy, brand, marketing and innovation. It includes the online portal Suncorp started that sells financial products offered by partners. The first few months sounded unsettling. At Microsoft, Marlow had networks, corporate history and knowledge, and colleagues and clients could expect her to answer pretty much anything. As a newbie at Suncorp, she had none of that. The language and the acronyms were foreign, as were the people. WHAT1SMYVALUE? "My value at the start was not around corporate knowledge or industry knowledge. I think for me one of the hardest things was [asking]: 'What is my value?' " [At Microsoft] I was comfortable in that knowledge and that capability. Suddenly knowing that I didn't have that was a big adjustment. It was like I came to look in the mirror to say: 'OK, how are you going to help this company when you don't have that?'" The big adjustments for Marlow included being in much closer proximity

146 Australian Financial Review, Australia Author: Dominic Lorrimer And Elke Meitzel Section: Boss Article type : News Item Classification : National : 44,635 Page: 28 Printed Size: cm² Market: National Country: Australia ASR: AUD 41,930 Words: 2700 Item ID: Page 4 of 4 to shareholders, giving her a keen sense of responsibility for investing other people's money, and no longer having to wait for decrees from head office. After a few months, she had an epiphany. "I'd worked for a multinational for so long, three or four months in I was going: 'Why ain't I making more progress?' And then I think I realised I was waiting for head office, and I thought 'Oh, now I am head office.' You've got to change your mindset." Marlow says it was six months before she felt comfortable that she understood the Suncorp machine. That is not to say it has all been smooth sailing. Marlow has conceded that the online marketplace has not been easy. Asked what she has learned, Marlow points to resilience, a new set of skills in areas such as board engagement, investor engagement and change management, knowledge in areas such as insurance, payroll and pricing, and friends. Further down the track, she hopes it might lead to board roles. "Ultimately, if I want to have a career on a board one day, having had this set of experiences, hopefully they will make me a better person and a more effective board member later." TOP TIPS Let go of your fears, such as a fear of failure or a fear of not knowing the answers. Be prepared to be vulnerable. Just say "You know what, I'm going to be asking the dumb questions for a while" and get comfortable with that. Find someone off whom you can bounce ideas. Buy yourself 100 days. Don't make a 100-day plan until you've done 100 days. If you are going to restructure, be careful not to discard functions or people who are valuable. AHMED FAHDUR Being unencumbered by baggage can be a benefit but it makes transformation risky. One of the key differences between running the largest division of National Australia Bank and Australia Post was the shift in focus from managing risk to transforming an entire business model. Ahmed Fahour was appointed chief executive of Australia Post in 2010, having spent five years at NAB. He is also a former management consultant with BCG, and in early October it was announced he had been appointed chief executive of consumer finance business Latitude Financial Services. "Risk management is a critical capability in being able to run a bank," Fahour says. "Yes, risk management's important for consulting. Yes, it's important for Australia Post, but it wasn't... the single biggest issue. In the case of Australia Post, literally its core business for 200 years was [going] extinct." Executives coming from a different industry have the benefit of not carrying any baggage, allowing them to look at a business unencumbered. On the other hand, a lack of knowledge and corporate history can make a restructure potentially dangerous. "The big, big issue... is that you better be damned careful, because what you are throwing out might be quite valuable and you've got to think through what can be reused," Fahour says. He promoted the two "longest-serving, most successful" executives in the business: Jim Marshall, who became chief operating officer, and Christine Corbett, whom he found "four levels down" and promoted to chief customer officer. "So, making sure that you don't throw out the old but blend it well [and] cohesively with the new is the only way as a CEO to move from one industry to the other and bring about effective change," Fahour says. The night before his first day at Australia Post, February 1,2010, is still vivid. Following the lead of his young daughter, he laid out his clothes for the following day. "My daughter said to me, 'Dad, now it's very important, on your first day of work make sure you're nice to everybody so you can make some friends.'" On his first day, Fahour made a presentation to the top 250 people in the business then asked them to write him a twopage letter - not an - detailing four key issues, including naming two things they didn't like about Australia Post and two ideas that could be implemented immediately to help save the business. In the previous 12 months, the business's profits had fallen 60 per cent. "I got 250 letters. I still have those 250 letters, I might add," he says. "I got to know people. People were so honest and open. Then over the years, some of them would sit down and we would talk about the letter and we would talk about what they did and what it meant."