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October 2019 HRM magazine 19
But just like the trial in France, there are
doubts about the commission. It took years of
parliamentary back-and-forth to get the go-
ahead, and its main outcomes were that public
shaming and a series of recommendations. Such
limited accountability, that requires such a bitter
political fight, is not sustainable.
In his final report, commissioner Kenneth
Hayne made clear he was grappling with how
he could possibly prevent future misconduct.
“Much more often than not, the conduct now
condemned was contrary to law. Passing some
new law to say, again, ‘Do not do that’, would
add an extra layer of legal complexity to an
already complex regulatory regime.”
He concludes that something more grand than
punishing instances of misbehaviour is required.
“Culture, governance and remuneration.
Each of those words can provoke a torrent of
clichés. Each can provoke serious debate about
definition. But there is no other vocabulary
available to discuss issues that lie at the centre
of what has happened in Australia’s financial
The government has promised to implement
all his recommendations by the end of 2020,
but there are real questions about whether that
will be enough. As senior lecturers at RMIT,
Andrew Linden and Warren Staples, wrote
for The Conversation, for the past 30 years
Australia’s financial sector has had a 10-15 year
cycle. It involves “public inquiries followed by
reports, then (sometimes) trials, then books,
then almost everyone forgetting (except for
those personally scarred), only for problems to
They believe that Hayne didn’t address
systemic issues and they argue that the report’s
“impact will be generational rather than
permanent” and its recommendations are a “a
patchwork of measures that if implemented will
over time be eaten away – and at some point will
be dismantled – because the rationale for their
adoption will be forgotten”.
The lecturers argue for improved oversight
via two -tiered boards (one management, one
supervisory) and employee directors (staff-
elected board members, which are often a
feature of a supervisory board).
“If all the information that the board is seeing
is coming from one or two points of contact
– the CEO, COO or CFO – then they are getting
a very filtered view,” says Pigrum.
But she is also hopeful that things like royal
commissions will accelerate a movement she
already sees happening, where organisations get
better at holding themselves accountable.
A less dramatic method to create sustainable
cultural accountability would be to bring
it down to the level of the profession. If
accountants can face a disciplinary process for
complaints against their bookkeeping, why can’t
a similar thing happen for culture?
Though it's commonly said that the
responsibility for culture lies with leadership,
a typical role for HR is to help the C-suite
understand and shape it. Despite this,
during the Hayne royal commission no HR
professional was made responsible. Ensuring
there is a professional and ethical standard
HR practitioners have to attain and maintain
would give them more credibility (and therefore
responsibility) to be a culture partner. Also,
raising the profile of the culture partner would
have the benefit of raising the profile of culture
But for such a thing to happen, there needs to
be a desire for it outside of the profession itself.
Empowering HR with certification is a goal of
AHRI, which publishes this magazine. But there
is evidence that there is a wider appetite for it.
Recent research from InSync and AHRI
su rveyed over 90 0 Australian professionals,
from frontline workers to CEOs. It found 78
per cent of non-H R professionals either agreed
or strongly agreed that HR practitioners should
be held accountable against a standard. And
69 per cent agreed or strongly agreed that the
professional body for H R practitioners should
hold members accountable to that standard.
Of course, H R certification is not a total
solution. The certification of accountants has
hardly eliminated malpractice. Also, for all the
reasons stated above, a dodgy culture is far
harder to assess than dodgy books. The risk
of this for practitioners is that they would be
19/9/19 3:06 pm
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