26 - 28 September, 2017 | Novotel Sydney Central

Media Center

Articles

Why the finance sector needs to start thinking like hackers to better manage cyber risks

Jamie Woodruff an ethical hacker who has worked with a number of big organisations globally – such as Facebook, Twitter, YouTube and Bloomberg – to find flaws in their systems to mitigate cyber risks.

In this article, Jamie explores why banks are so vulnerable to hacking and what they can do to re-structure their risk management framework to combat cyber security risks now and in the future.

Identifying risk appetite to drive better business outcomes

In this article, Sean Hughes, Chief Risk and Legal Officer and UniSuper, explores what ‘risk appetite’ actually means in financial services and how UniSuper is using it as a tool to not only to improve business performance, but also effectively mitigating conduct risk in the current regulatory environment.

Managing Conduct Risk: Reworking Regulation & Culture

There has been no shortage of well-publicised and highly damaging misconduct scandals within the financial services industry over the past decade, with all of Australia’s major financial institutions all under scrutiny at one point or another.

Conduct risk refers to the fines, class actions and increased regulatory oversight that comes as a result of constant bank misdemeanours. As reported by Fitch, while the fines were unlikely to be material to the banks, the reputational damage caused by repeated offences may begin to take its toll.

Conduct is a lens into the culture of organisations. Improving conduct within industry is an essential part of rebuilding trust and supporting future sustainable growth.

Ahead of the Conduct Risk, Culture and Regulation in Financial Services Summit 2017 we take a look at the state of Australia’s financial services industry, which over the last five years has clocked up some $10 billion in conduct costs, and delve into the regulation and culture reform strategies that will change banking misconduct for good. 

Exclusive Content

What does it take to create and maintain an effective risk culture in financial services?

Developing a culture of ethical conduct is about having the right people, systems and processes in place to measure, manage and mitigate risks.

In this report, a number of key influencers in the financial services conduct risk space explore the strategies they are using in their organisations to embed an effective risk culture and how they are going about measuring risk culture to minimise risk across their businesses.

Top Tips to Effectively Manage Conduct Risk in your Organisation

With a recent spark of high profile scandals, Prime Minister Malcolm Turnbull’s latest comments on bank culture, and a $6.2 billion bank levy tax announced in the Federal Budget earlier this year, conduct risk is fast becoming a bigger and bigger issue in the financial sector.

Ahead of the Conduct Risk Summit we look at some top tips from a host of Australia’s largest financial institutions and regulators to help your organisation promote ethical behavior and better manage conduct risk.

Presentations

Model Standardisation: Regulatory Risk Models

In this presentation from Risk, Regulation and Culture in Financial Services 2015, Russell Grimwood Executive Manager, Market Risk Management, Commonwealth Bank, explores balancing internal and regulatory applications for risk modeling, including:

  • Evaluating the impact of standardisation in the marketplace
  • Predicting the correct balance between risk sensitivity and comparability
  • Considering an alternative to internal ratings based models
  • Detailing the supervisory culture and outlining where

Managing Risk without Stifling Innovation

In this presentation from Risk, Regulation and Culture in Financial Services 2015, Francesca Dickson Group Risk Manager, the BPAY Group explores the need for innovation and risk management and how to better understand how to promote innovation within your organisation without comprising your solid risk management framework. The presentation explores:

  • innovation vs. risk management
  • utilising strategies to accept innovative approaches to risk management
  • benchmark your risk management framework and assess its need for innovation
  • optimising the acceptance of emerging technology in the risk arena without compromising exposure

Developing a Measurement Framework at a Community Mutual Group to Mitigate Conduct Risk

In this presentation from Conduct Risk Culture 2016 Campbell Nicoll, Chief Risk Officer at The Community Mutual Group explores:

  • Ensuring senior management and the board are sending aligned messages of risk culture
  • Defining the online survey programme implemented and what drove the organisation to use this technique as a key of measurement
  • Highlighting key findings and examples of eliminating risk through the questionnaire
  • Strategies for defining terms and conditions, policy and procedures

Core Research Findings on Ethical Culture with Macquarie University

In this past presentation from Conduct Risk 2016 Elizabeth Sheedy, Associate Professor at Macquarie University explores:

  • Discussing alternative methods for assessing an ethical culture
  • An overview of key findings on how to manage ethical behaviour and how a culture can be created
  • Understanding the drivers of behaviours and how this affects conduct and culture
  • Identifying indicators of misconduct and strategies to prevent it

Whitepapers

Conduct Risk Report 2015/16

Thomson Reuters third annual survey on how financial services firms are managing conduct risk has identified distinct industry wide trends against which firms can benchmark their own progress.

National Media

APRA pushes bank boards to define, improve risk culture

The Commonwealth Bank of Australia board will provide the banking regulator with its definition of the bank's risk culture and a plan to improve standards.

Banks may be forced to do risk management audits

The parliamentary committee examining banking conduct may renew its push for the banks' risk management frameworks to be independently reviewed in the wake of AUSTRAC's legal action against Commonwealth Bank

AUSTRAC confirmed it briefed members of the House of Representatives economics committee in Canberra on Monday to provide insight about the legal basis for its claims against Commonwealth Bank of Australia and the evidence the regulator has gathered. The meeting was led by AUSTRAC's acting CEO Peter Clarke and attended by other senior AUSTRAC officials and happened after the committee requested it. 

 

CBA at risk of investigations by ­global regulators

Billions of dollars in Commonwealth Bank transactions in the US, Europe and Asia have not been properly monitored, the bank’s internal review has found, potentially exposing the institution to investigation by ­global regulators.

The confidential review of the bank’s compliance with Australian and ­global anti-money laundering and counter-terrorism laws revealed large-scale failures in transaction monitoring across a multitude of businesses around the world.

Commonwealth Bank inquiry: Is former APRA boss John Laker the right person for the job?

Sure, it recently turned in a record $9.93 billion profit, but Australia's biggest bank has been hit by scandal after scandal.

First there was it's involvement in lending to customers caught up by the Storm collapse, then the financial planning scandal, a series of complaints against CommInsure and finally the massive money laundering scandal, which could easily cost the bank billions of dollars in penalties.