The Customer Owned Banking Code Compliance Committee has published its report 2022 Code Transition and Implementation, on the findings of its inquiry into how customer owned banking institutions have approached transition to and implementation of the new industry Code of Practice.
The 2022 Customer Owned Banking Code of Practice (the Code) came into effect on 31 October 2022.
51 subscribers transitioned to the 2022 Code on 31 October 2022 while 4 subscribers were granted an extension up to October and December 2023.
The report focusses on 5 areas:
Training: The COBCCC observed that training is just one element of a good compliance framework. To support and underpin the training, subscribers must have strong systems and processes. Without them, breaches of the Code may go undetected.
Systems: The COBCCC observed that systems and controls should ensure that Code breaches can be mapped to specific Code provisions and capture sufficient data for subscribers to understand how and why a breach occurred. Policies, procedures and processes should reflect the Code’s requirements and make it easy for staff to comply with their obligations.
Interpreting obligations: The COBCCC observed that it is a base requirement that subscribers understand the obligations that come with subscribing to the Code.
Customer communication: The COBCCC considered that it is good practice to conduct a comprehensive communications campaign that included social media posts, web banners, staff email signature blocks, animated videos and print materials as well as displaying information about the new Code on television screens in branches.
Post Implementation Review: The COBCCC says conducting a PIR is an opportunity for a subscriber to evaluate its transition and identify areas of success and areas that require more work. It helps mitigate the risk that important issues are not left unaddressed or overlooked.
The Report concludes with important reminders for subscribers to help ensure a successful transition to the 2022 Code and continued compliance with its enhanced obligations:
- Make sure the new Code is easy to find on your website and any other information about the Code is accessible and easy to understand.
- Check that the 2022 Code is embedded in your compliance and risk management frameworks – map all Code provisions to your frameworks.
- Your Audit and Risk Committee should assure itself that you have the systems, processes and resources in place to comply with the new Code.
- Update and deliver training to ensure staff understand the new Code and the important role they play in identifying and reporting breaches.
- Check that your systems for monitoring compliance are set up to detect all breaches and capture all the information you need.
- Promote a broad interpretation of Code obligations to ensure good outcomes and transparency for customers.
- Undertake a post implementation review (PIR), as part of either an internal audit or an external audit program, to help identify opportunities for further improvement.
- Review your Code compliance frameworks regularly, including evaluation of any corrective measures you implemented.
- Ensure there is ongoing oversight by Senior Executives and the Board.
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Author: David Jacobson
Principal, Bright Corporate Law
About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.