About $100 million has been stripped from the 2017 and 2018 pay packets at the Commonwealth following a series of scandals at Australia’s biggest bank.
The 2017 annual report released today shows the cuts include 20% drop in fees for non-executive directors and the cancelling of short term bonuses for executives.
Chair Catherine Livingstone, writing in the 2018 annual report, said: “We take full responsibility for the issues we have faced, and are committed to addressing our failures.”
Sir David Higgins, the CBA’s Remuneration Committee Chairman, writes that executive pay has been directly impacted by the AUSTRAC money laundering breach settlement of $700 million and the APRA (Australian Prudential Regulation Authority’s) inquiry into the CBA.
Prudential regulator APRA has endorsed a Remedial Action Plan in response to the recommendations of the Prudential Inquiry into the bank’s governance, culture and accountability.
The inquiry also found a number of prominent cultural themes: “A widespread sense of complacency, a reactive stance in dealing with risks, being insular and not learning from experiences and mistakes, and an overly collegial and collaborative working environment which lessened the opportunity for constructive criticism, timely decision-making and a focus on outcomes.”
Sir David Higgins said: “The Board has also exercised its discretion to adjust downwards individual Executive remuneration outcomes, having regard to other risk and reputation matters.”
Comyn’s fixed and total target remuneration is 17% lower than Narev’s, as this chart shows:
Comyn’s statutory pay for the 12 months to June this year was $2,959,287, according to the annual report. The short-term bonus was zero.
Narev’s is shown as negative $314,912 because the costs of lost long term benefits have been reversed. The previous year he got $5,712,363.
The annual report also shows Narev received $3,983,713 in long term bonuses, but forfeited another $13,882,512.
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