Move on… nothing to see here.
That was the clear message from the Commonwealth Bank board and management as it sought to put space between it and the Royal Commission into banking misconduct at its AGM today.
In CEO Matt Comyn’s speech, the term “Royal Commission” did not appear at all.
In Chair Catherine Livingstone’s speech to shareholders, the term “Royal Commission” appeared just twice.
One of those mentions it was this: “We have already taken action on a number of the recommendations of the Royal Commission to improve outcomes for customers.”
As the bank seeks to move on, there was a series of motherhood statements: “Becoming a simpler, better bank,” is one current favoured phrase.
That was from Catherine Livingstone.
From Matt Comyn: “I recognise there is still much more to do to become a simpler, better bank.”
The truth is, the Commonwealth Bank, even without its insurance and financial services arms (in the process of being sold) are anything but simple.
Whether they are better remains to be seen.
The jettisoning of external divisions might make it simpler for the board and management to administer, but the core banking risks remain.
The Commonwealth, with 48,000 employees, is highly complex where the actions of one (or many) can in future cause customers and the public to question the organisation’s motives.
Take, for example, the seemingly straightforward issue of mortgage rate pricing.
The fact that banks could not properly explain why they did not pass on the RBA rates in full led to anger in senior Government circles and a new inquiry from the ACCC.
Today Catherine Livingstone, when asked about this said: “As you know it’s a very complex exercise.”
Get that? Complex, not simple.
Another shareholder stepped up and asked about mortgage pricing, struggled to get the “simple” answer he sought and was told by the Chair & CEO there was “complexity” around his question.
So for all the ambition for a simpler and better bank; for all the feel-good policies littered through the banks officers’ speeches today (climate change, staff domestic violence leave, green mortgages, eliminating the risk of human slavery) behavioural risk has not disappeared from the Commonwealth, or any bank.
And it remains the key issue for any board and CEO to manage and to understand.
As an aside, well intentioned though they might be, surely the best corporate & social policies are done quietly, not advertised to make others (or even your own shareholders) feel good about you.
The reputational recovery from the Royal Commission scandals takes much more than this, and more time. Much more.