One of NZ’s biggest banks has hit the international headlines for inadequate governance oversight. The review focused on risk – a hot topic right now, especially around banking boardrooms.
In November 2021, the NZ Reserve Bank released an independent report done by UK consultants on Westpac NZ's risk governance processes.
It’s a simple, clear, even blunt summary of a 3 month look inside the bank’s governance. It’s not pretty and will make tough reading for the current and past directors and the executive team.
It would be easy to see the finding that the board “did not have sufficient expertise” as the most critical comment. But other extracts are firmly critical too, such as:
- “Agendas were lengthy… and not always aligned with priority risks & issues” or
- “non-board members materially outnumbered Directors on most [meeting] occasions” or
- There were”inconsistencies in the tone from the top”.
We can all learn from the report – particularly how important it is to line up paperwork, processes, resources and capabilities. This stuff is not “boring paperwork”.
It is the skeleton, flesh and blood of great governance and it matters. This is another step towards strong institutions which we all need. You can read the report here – 10 pages only (which makes a nice change for governance paperwork!)