nach oben

Erschienen in:

2022 | OriginalPaper | Buchkapitel

26. Skills, Independence, Competence and ‘Fit and Proper Person’ Tests

verfasst von : Francesco de Zwart

Erschienen in: The Key Code and Advanced Handbook for the Governance and Supervision of Banks in Australia

Verlag: Springer Nature Singapore

Einloggen

Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.

search-config

KI-gestützte Suche

Aus

Abstract

In Chapter 26 of the Stage 2 Key Code and Advanced Handbook for the governance of Australian major banks, we examine skills, independence, competence and the ‘fit and proper person’ tests. This begins with the requirements for ASX listed entities including the independence test and the ASX listed entities disclosure and factors of independence.

We present the existing governance variables based on the independence ingredient and find that independence may be associated with less bank-specific knowledge. We apply this to bank-specific variables exhibiting a deficiency in banking industry knowledge and competence with a coverage/rating of −4/50.00 rprox. We also find that ‘pro-shareholder boards’ performed worse during the crisis.

We turn then to the OECD findings on independence and competence and construct a governance variable based on the OECD recommendations for independence and bank-specific skills, competence and professional qualities with a coverage/rating of +7/87.50 rprox – the [NEDBankSkillsMon] (+) variable. We continue with governance variables based on the OECD recommendations on separation of the CEO and Chairperson roles and governance variables based on the OECD recommendations on the ‘fit and proper person’ test by supervisory authorities.

Governance variables are constructed for APRA’s Prudential Standard 520 Fit and Proper including governance variables for fit and proper policy, additional requirements for Head of a group, responsible persons and senior managers. We examine the criteria for fit and proper persons and the process for assessing fit and proper persons. There is a whistleblowing provision for the fit and proper policy. A responsible person who is not fit and proper is not to hold a position including the information to be provided to APRA.

We conclude with governance variables based on the OECD recommendations on continuing training.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

über 102.000 Bücher
über 537 Zeitschriften

aus folgenden Fachgebieten:

Automobil + Motoren
Bauwesen + Immobilien
Business IT + Informatik
Elektrotechnik + Elektronik
Energie + Nachhaltigkeit
Finance + Banking
Management + Führung
Marketing + Vertrieb
Maschinenbau + Werkstoffe
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

über 67.000 Bücher
über 340 Zeitschriften

aus folgenden Fachgebieten:

Bauwesen + Immobilien
Business IT + Informatik
Finance + Banking
Management + Führung
Marketing + Vertrieb
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Vorheriges Kapitel Diversity

Nächstes Kapitel Failures in Risk Modelling and Rating Securitized Products

Australian Securities Exchange, ASX Corporate Governance Council, Corporate Governance Principles and Recommendations, Fourth Edition, February 2019, accessed 10 April 2020, available at https://www.asx.com.au/documents/regulation/cgc-principles-and-recommendations-fourth-edn.pdf (‘2019ASX’).

Francesco de Zwart, Enhancing Firm Sustainability Through Governance, The Relational Corporate Governance Approach, Cheltenham, UK and Northampton, MA, USA: Edward Elgar Publishing, Corporations, Globalisation and the Law Series, July 2015, (‘Stage 1’). See discussion in section 7.3.1.2.1 of Stage 1, pp 198–199.

For Stage 1, see also, Francesco de Zwart, “Enhancing firm sustainability through governance – Part 1: The challenge of corporate governance” (2018) 33(2) Aust Jnl of Corp Law 144 and Francesco de Zwart, “Enhancing firm sustainability through governance – Part 2: The framework of the relational corporate governance approach” (2019) 34(1) Aust Jnl of Corp Law 27.

2019ASX, above n 1, Rec 2.2, p 13.

Ibid, Commentary to Rec 2.2, p 13.

Australian Prudential Regulation Authority, Prudential Standard CPS 510 Governance, July 2019, accessed 22 September 2019, available at: https://www.legislation.gov.au/Details/F2019L00662/Download (‘CPS 510’), sections 23–24, p 9.

See discussion in section 7.3.2.1.2 of Stage 1, above n 2, p 211.

CPS 510, above n 5, section 23, p 9.

Ibid, section 25, p 9.

2019ASX, above n 1, p 13.

Ibid, Rec 2.3, p 13.

Ibid.

Ibid, Box 2.3, p 14.

Ibid, Commentary to Rec 2.3, p 14.

Ibid.

Ibid, Rec 2.4, p 15.

Ibid, Rec 2.5, p 15.

See discussion in section 7.3.1.2.1 of Stage 1, above n 2, pp 198–199.

2019ASX, above n 1, Rec 2.6, p 15.

Ibid, Commentary to Rec 2.6, p 15.

Ibid.

Ibid, Rec 2.6, p 15.

Ibid, Commentary to Rec 2.6, p 15.

Ibid.

See discussion in section 8.4.3 of Stage 1, above n 2, pp 242–244.

Ibid.

See discussion in section 7.3.2.1.3 of Stage 1, above n 2, pp 212–215.

See discussion in section 7.3.2.1.1–7.3.2.1.2 of Stage 1, above n 2, pp 208–212.

See discussion in sections 8.2.3–8.2.3.1 of Stage 1, above n 2, pp 229–232.

See discussion in section 16.1 above.

Renee B Adams, “Governance and the Financial Crisis” (May 4, 2009). ECGI - Finance Working Paper No. 248/2009, (4 May 2009), accessed 13 June 2017 at SSRN: http://ssrn.com/abstract=1398583

Ibid, 7.

Ibid. The author cites R Adams, B Hermalin and M Weisbach, “The Role of Boards of Directors in Corporate Governance: A Conceptual Framework and Survey”, forthcoming, Journal of Economic Literature, 2009.

Adams, above n 31, 13.

Ibid.

Renee B Adams, ‘The Dual Role of Corporate Boards as Advisors and Monitors of Management: Theory and Evidence’, previously titled ‘The Dual Role of Corporate Boards as Advisors and Monitors of Management’, accessed 3 March 2015 at SSRN: http://ssrn.com/abstract=241581, 2.

Renee B Adams and Daniel Ferreira, ‘A Theory of Friendly Boards’ (2007) 62(1) Journal of Finance 217–50, available at SSRN: http://ssrn.com/abstract=866625, 2.

Jennifer G Hill, ‘Regulatory Responses to Global Corporate Scandals’ (2005) 23 Wisconsin International Law Journal 367, accessed 3 March 2015 at SSRN: http://ssrn.com/abstract=886104, 389.

Ran Duchin, John G Matsusaka and Oguzhan Ozbas, ‘When Are Outside Directors Effective?’, USC CLEO Research Paper No C07–13 (February 2008), accessed 3 March 2015 at SSRN: http://ssrn.com/abstract=1026488, 1.

See discussion in section 7.3.2.1.3 of Stage 1, above n 2, pp 212–214.

Renee Adams, “Governance and the Financial Crisis” (Eur. Corp. Governance Inst., Finance Working Paper No. 284/2009, 2009), available at http://ssrn.com/abstract=1398583

Ibid, 7.

Ibid, 13.

Rüdiger Fahlenbrach and René M Stulz, “Bank CEO Incentives and the Credit Crisis”, Journal of Financial Economics (JFE), Forthcoming; Charles A Dice Center Working Paper No. 2009-13; Fisher College of Business Working Paper No. 2009-03-13; Swiss Finance Institute Research Paper No. 09-27; ECGI - Finance Working Paper No. 256/2009, (12 August 2010), accessed 5 April 2017 at SSRN: http://ssrn.com/abstract=1439859, 25.

Andrea Beltratti and René M Stulz, “Why Did Some Banks Perform Better during the Credit Crisis? A Cross-Country Study of the Impact of Governance and Regulation”, Fisher College of Business Working Paper No. 2009–03-012, (13 July 2009), accessed 6 April 2017 at SSRN: http://ssrn.com/abstract=1433502

Ibid, 3. The authors cite Adams, Renée, 2009, Governance and the financial crisis, unpublished paper, University of Queensland, Brisbane, Australia.

Ibid.

OECD Steering Group on Corporate Governance, Corporate Governance and the Financial Crisis: Key Findings and Main Messages June 2009, approved for publication 29 May 2009, accessed 13 June 2017 at www.oecd.org/corporate/ca/corporategovernanceprinciples/43056196.pdf, (‘OECD Key Findings 2009’), Board practices, pp 9–10.

Ibid, p 46.

Ibid, pp 9–10.

OECD Steering Group on Corporate Governance, Corporate Governance and the Financial Crisis, Conclusions and emerging good practices to enhance implementation of the Principles, accessed 13 June 2017 at www.oecd.org/corporate/ca/corporategovernanceprinciples/44679170.pdf, (‘OECD 2010 Conclusions and Practices’), Box 3. Key Findings and Main Messages: Board Practices, p 17.

Ibid, Para 54, p 20.

Ibid, Para 57, p 21.

See discussion in section 7.3.2.1.2 of Stage 1, above n 2, pp 211–212.

See discussion in section 7.3.1.2.1 of Stage 1, above n 2, pp 198–201.

See discussion in this section 26.3 citing OECD Key Findings 2009, above n 48, p 46 and OECD 2010 Conclusions and Practices, above n 51, p 17.

OECD Key Findings 2009, above n 48, pp 10 and 45–46.

Australian Prudential Regulation Authority, Prudential Standard CPS 520 Fit and Proper, July 2019, accessed 1 October 2019, available at: https://www.legislation.gov.au/Details/F2018L01390/Download (‘CPS 520’), section 5, p 5. In addition to finalisation of APRA’s Draft Prudential Standard 511 Remuneration, APRA has announced that it intends to consult on revised versions of Prudential Standard CPS 510 Governance, Prudential Standard CPS 220 Risk Management and Prudential Standard 520 Fit and Proper in the second half of 2020 with expected effective dates of 2022. See Australian Prudential Regulation Authority, Information Paper, APRA’s Policy Priorities, section 2.1.1 Governance and risk management, section 2.1.3 Accountability and Attachment B: Timelines.

See discussion in section 7.3.1.2.1 of Stage 1, above n 2, pp 198–199.

Board Independent Director: Executive Director Proportion – Monitoring Effect, +7/87.50 rprox.

See discussion in section 2.6.2 of Stage 1, above n 2, pp 41–43.

CPS 520, above n 58, section 12, pp 6–7.

Ibid, p 7.

Ibid, section 13, p 7.

Ibid, section 14, p 7.

Ibid, section 15, p 7.

Ibid, section 16, p 7.

Ibid, section 17, p 7.

Ibid, section 18, p 7.

Ibid, section 19, p 7.

Ibid, section 20(a), p 7.

Ibid, Attachment A, p 18.

Ibid, section 20(g), p 8.

Ibid, section 21, p 8.

Ibid, section 22, p 8.

Ibid, section 23, p 8.

Ibid, section 25, pp 8–9.

Ibid, sections 259(a)-(c), pp 8–9

Ibid, section 26, pp 8–9.

Ibid, section 29, p 10.

Ibid, section 30, p 10.

Ibid, sections 30(a)–(c), p 10.

See ibid., sections 31–33, pp 10–12.

See ibid., sections 34–37, pp 12–13.

Ibid, section 29, p 10.

Ibid, section 38, p 13.

Ibid, section 39, p 13.

Ibid, section 40, p 14.

Ibid, section 41, p 14.

Ibid, section 42, p 14.

Ibid, section 43, p 14.

Ibid, section 44, p 14.

Ibid, section 45, p 14.

Ibid, section 46, p 15.

Ibid, section 47, p 15.

Ibid, section 48, p 15.

Ibid, section 49, p 15.

Ibid, section 50, p 15.

100

Ibid, section 51, p 15.

101

Ibid, section 52, p 16.

102

Ibid, section 53, p 16.

103

Ibid.

104

Ibid, section 54, p 16.

105

Ibid, section 54, p 16.

106

Ibid, section 55, p 16.

107

Ibid, section 56, p 16.

108

Ibid, section 57, pp 16–17.

109

Ibid.

110

Ibid, section 58, p 17.

111

Ibid, section 59, p 17.

112

Ibid.

113

Ibid, section 60, p 17.

Titel: Skills, Independence, Competence and ‘Fit and Proper Person’ Tests
verfasst von: Francesco de Zwart
Verlag: Springer Nature Singapore
Buch: The Key Code and Advanced Handbook for the Governance and Supervision of Banks in Australia
Print ISBN: 978-981-16-1709-6

Electronic ISBN: 978-981-16-1710-2

Copyright-Jahr: 2022
DOI: https://doi.org/10.1007/978-981-16-1710-2_26

Springer Professional

Abstract

Bitte loggen Sie sich ein, um Zugang zu Ihrer Lizenz zu erhalten.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Springer Professional "Wirtschaft"