New insights for ensuring compliance with APRA's CPS 230

The Australian Prudential Regulation Authority (APRA) has recently released Prudential Practice Guide CPG 230, a comprehensive guide to Prudential Standard CPS 230, on operational risk management. This guide clarifies compliance requirements for APRA-regulated banks, life and general insurers and superannuation trustees. Further, it will assist technology vendors and service providers serving APRA-regulated entities in navigating potential enhanced risk management obligations in their interactions with these entities.

In July 2023, APRA introduced Prudential Standard CPS 230 to address key vulnerabilities in operational risk management within APRA-regulated entities, including ineffective controls, low disruption tolerance, and the increasing reliance on service providers. In essence, CPS 230 requires that APRA-regulated entities establish and maintain robust risk management frameworks, enhance board governance, accountability, and oversight, assess and