Banks too often blame compliance failures on ‘human error’, according to the Banking Code Compliance Committee (BCCC). Between 2017 and 2019, more than 90% of breaches of the Banking Code of Practice were attributed to staff errors.
In a report released today, the BCCC has urged banks to take action to improve compliance with the Code and deliver better customer outcomes.
The BCCC’s Independent Chairperson, Ian Govey AM, said the mind -set and behaviours of all bank employees, from the front-line to senior executives, have a crucial role to play in upholding the promises made to customers.
The BCCC’s report, Building Organisational Capability, makes 17 better practice recommendations under five key areas:
- Communication strategy – that is effective and ensures employees understand the intent and importance of processes related to the Code’s customer protections.
- Learning and development – that goes beyond Code awareness to ensure all staff understand the Code’s role in the consumer protection framework.
- Systems, processes and technology – that is designed for compliance and has the customer and employee’s needs at its centre.
- Robust compliance frameworks – that can accurately identify a breach, drill down to find the true root cause and fix it to prevent it from happening again.
- Culture – that promotes customer-centric decision making and empowers staff to take ownership of achieving fair customer outcomes.
“Banks should consider this report a go-to resource for how they can drive continuous improvement and compliance with the Code,” Mr Govey said.
“The BCCC expects banks to self-assess where they are falling short and challenge historical practices when necessary. The Committee will be using the report to support its monitoring activities and anticipates that Code subscribers will take proactive steps to implement its
Details about the BCCC and its work are available on its website.
Chief Executive Officer
Banking Code Compliance Committee