ABA argues against collective BEAR punishment
The Bank Executive Accountability Regime (BEAR) should apply to individuals ensuring multiple bank executives are not held responsible for the actions of others, according to the Australian Bankers’ Association (ABA).
The ABA has used its submission to the Senate Economics Legislation Committee inquiry into the BEAR legislation to argue “that each accountable person must be individually responsible and accountable for their own conduct, and execution of their own responsibilities”.
It said that in these circumstances an individual “should not be made accountable for the performance or conduct of another accountable person”.
In doing so, the ABA cited the experience in the United Kingdom and that country’s Senior Managers Regime where it said individuals with “shared” responsibility were and therefore not liable for the other person’s actions.
“There is no policy rationale why the Australian regime should differ from the UK model in this regard,” the ABA said and recommended that the BEAR legislation be amended to provide that the obligations apply on an individual basis in accordance with responsibilities.
Further, the ABA wants bank executives to have the ability that they should not be punished because they took all reasonable steps.
“The ABA believes the accountability obligations of an accountable person should be considered to be discharged in circumstances where the accountable person has undertaken all steps that a reasonable person would undertake, having regard to the scope of the person’s role and responsibilities and the particular circumstances of the ADI at the relevant time,” he submission said.
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
