AUSTRALIA’S CORPORATE and financial regulators must revamp their recruitment and retention processes if they are to ease the red tape burden on business, senior figures have warned.
AUSTRALIA’S CORPORATE and financial regulators must revamp their recruitment and retention processes if they are to ease the red tape burden on business, senior figures have warned.
The Federal Government has convened a task force charged with investigating ways of reducing the regulatory burden on business, and the culture, recruitment and retention policies of regulators has been cited as a key issue. The post Enron and HIH Insurance era has seen huge changes in the way companies are regulated in Australia. Risk management, compliance and governance are now key management issues, and both regulators and corporates are fighting for the best talent in those areas.
However, regulators, unable to compete on salary, frequently hire inexperienced staff with a strong legal, rather than business, background, senior figures said.
The Australian Prudential Regulation Authority (APRA), which regulates the banking, insurance and financial services industries, has admitted it can have trouble recruiting and retaining skilled staff. APRA chairman Dr John Laker said last year that while the regulator is keen to attract experienced people from industry it cannot always compete on salary alone. “What doesn’t make it any easier ... is that our people are themselves being headhunted for roles in industry,”Laker said.
“I sat on the HIH Royal Commission, and one of the significant issues there was that the recruitment and retention of experienced and expert personnel is very difficult,” said Chris Cass, a partner at Deloitte. “The private sector looks to the regulator to feed the dragon and regulators will also be looking to recruit personnel with commercial experience.”
According to AMP chief executive Andrew Mohl, for regulators to truly achieve their goals, an overhaul of remuneration, recruitment, culture and retention is needed. “Improving the culture and industry expertise within the regulators may come about if the overriding mandate of the regulators included a requirement to interpret and enforce the laws with consideration being given to the economic costs and the commercial implications to industry,” Mohl said.
“The diversity and skill set required by the regulators would change to include other professions including economists, accountants and actuaries and, most importantly, those with industry experience and commercial backgrounds,” he said. “Allowing regulators to operate outside of the Public Service Act would also help attract staff with industry experience.”
