It was hardly a revelation to hear Hayne’s declaration
that primary responsibility for misconduct in the financial
services industry, and the consequences that followed, lies with
the entities themselves and their boards and senior management.
Hayne’s advice? Every entity must look to its
culture and governance and how it manages regulatory, compliance
and conduct risk, he says.
But it is clear that this introspection will be hard, and the
changes required will not make themselves. So, whose job is this
anyway? An entity, like Newton’s object at rest, can
scarcely effect change unless acted upon by a force.
This force must be leadership.
Hayne does not address specifically what he expects of leaders
of financial services entities. His messages are more implicit. The
APRA-commissioned Prudential Inquiry into the Commonwealth Bank was
perhaps more instructive. The APRA report alluded to the importance
of “broader leadership repertoire of skills and
