The chapter on governance weaknesses at ANZ in the Oliver Wyman review of ANZ’s Global Markets business on Thursday paints a far more devastating picture of the bank’s overall risk governance framework than is crystallised in findings and anodyne recommendations to the bank’s board.
ANZ’s Global Markets business has drawn media attention due to a trio of scandals related to conduct, workplace behaviour, and non-financial risk governance.
Oliver Wyman conducted the review from October 2024 to March 2025, characterising ANZ as a ‘reactive’ institution and leading APRA to impose a $250 capital add-on on ANZ, taking the capital add-on for accumulated risk management failures by the bank to $1 billion.
“Over time, the execution of Three Lines of Defence model within Markets has resulted in lack of role clarity across first and second lines” Oliver Wyman said.
“This has diminished front line non-financial risk management accountability and has limited the degree to which front line staff could improve their non-financial risk capabilities.
“Over time, the mandate of the Markets Desk Risk Management function has shifted from its original purpose, leading to decreased risk ownership and perceived accountability among Markets staff.
“Many Markets staff and aligned functions perceive the desk risk managers (DRMs) as having a mandate that overlaps with responsibilities designated for front office staff, as well as other independent enablement functions like the Risk function and Talent and Culture.
“We observed inconsistencies in the understanding of DRMs’ roles across Markets. Some interviewees, including senior Markets staff, perceive DRMs to be risk owners.
“Discussions with DRMs revealed similar ambiguity regarding their roles, with some articulating their responsibilities in line with the formal definition of the DRM position, while others indicated a broader scope that included ownership of non-financial risk management or functioning in a commercial enablement capacity.”
In a telling observation, Oliver Wyman said: “Many DRMs actively participate in daily risk management activities, leading some Markets staff to perceive them as risk owners.”
Management of the risk function is, or was, a mess.
“Multiple interviewees expressed concerns about their ability to perform the front office business activities asked of them, citing issues such as backfilling roles with less experienced staff or failing to backfill positions during leave or attrition” Oliver Wyman said.
“Markets staff across a few locations reported not knowing who their manager was.
“Some employees felt they were managing higher-risk or larger portfolios than their skills or capacity allowed, without the necessary additional oversight or support to handle these responsibilities effectively.”
No executives of ANZ have been fired as a result of these material breakdowns in management, with accountability obviously reaching all the way to the top.
Shayne Elliott, ANZ’s CEO will be leaving early in five weeks with his successor Nuno Matos taking over on 14 May.
For now Mark Whelan, Group Executive, Institutional at ANZ since 2016 remains in his post but it must be doubtful he will remain for long.
Instead, on Thursday, the bank said Whelan will oversee the implementation of the 19 recommendations and 53 sub recommendations of the Oliver Wyman review. He will be supported by a working group