The Background

Following the Banking Royal Commission, APRA (Australian Prudential Regulation Authority) devised a new regulation CPS 511 to come into effect in major banks and insurance companies by 2023. This focused on reviewing the remuneration frameworks to ensure that behaviours with a negative impact on customers were not incentivised.

Working within one of Australia’s biggest banks, we were engaged to assist in the design and implementation of a revised remuneration framework to ensure that they would be compliant and that all affected staff and third parties were aware of the upcoming changes and how they affected each individual or company.

What we did

As a regulatory change in which most of the changes were happening behind the scenes, the change implementation focused more on ensuring the right information got to the right people as and when they needed it.

In addition to our primary role facilitating change and managing stakeholders, we also assisted with project and business analyst activities to further support the team. These ancillary activities included:

• Development of a strategy for identifying, reviewing and engaging with affected hundreds of contractors was developed to ensure that they were aware of the changes to remuneration and their obligations to the bank while ensuring they were not inundated with unnecessary duplicate information where they worked with other financial institutions.

• A comprehensive review and analysis of existing relevant controls and the design and publication of multiple new controls to ensure the longevity and compliance of the regulatory changes being implemented.

Project Challenges

Lack of clarity and high uncertainty

Because the regulatory standard was to be applied to a large number of companies of different sizes across banking and insurance, there was a degree of uncertainty over what was actually required for implementation and the due dates. This meant there was greater resistance presented not only by the change recipients who were also being subjected to other changes at the same time but by stakeholders whose assistance was required to deliver the changes, many of whom saw it as a lower priority to more pressing needs.

Continuously changing stakeholders

While the change strategy could help determine how best to present the information, the ongoing discovery of new stakeholder groups with different interests added an extra layer of complexity. From individuals changing roles over the 12 month implementation period to cohorts of change recipients being moved in and out of scope, it was evident that a proactive stakeholder management strategy would be required.

The Outcome

• Over 2000 impacted stakeholders had been identified and engaged and strategies put in place before the regulations were to come into effect.

• Educational content was published on the company intranet and support materials for directly impacted staff had been developed.