No evidence to back up Livingstone’s claims

— 1 minute read

Commonwealth Bank chair Catherine Livingstone insisted she had challenged the bank’s regulatory report despite there being no evidence of her doing so.

Counsel-assisting Rowena Orr questioned Ms Livingstone during the morning session of day two of the final round of the commission and asked why there was no reference to any director challenging management on the contents of the regulatory report in an October 2016 board meeting.

Ms Livingstone insisted that she challenged the AUSTRAC notices and received assurances by management in response to the challenge despite there being no record of any such challenge in the CBA minutes. 


“Do you accept that they [the CBA board minutes] don’t record a very significant exchange that you say occurred at this meeting but which we have no record of?” said Ms Orr.

“I do accept that, but I am also aware that I am giving evidence under oath,” the CBA chair said. 

“Do you understand that a failure to comply with the requirements in relation to the keeping of minutes under section 251A of the Corps Act is an offence?” asked Ms Orr. 

 - “I am, but these are the minutes of the meeting. I assert again that I asked the question." (Livingstone)

 - “And you can offer no explanation for why that is not reported in these minutes?" (Orr)

 “The explanation is the minutes don’t usually record verbatim what is discussed at the board meeting,” Ms Livingstone said. 

Ms Orr moved onto remunerations at executive level, which Ms Livingstone as part of the remuneration committee was privy too. 

The CBA chair defended remunerations to reflect the work of executives but preempted Ms Orr by saying risk issues in remuneration reports were inadequate. 

Ms Livingstone agreed with counsel-assisting that CBA knew at the 2016 remuneration committee meeting about the ASIC and APRA investigation, fees for no service issue and anti-money laundering and counter-terrorism financing (AML/CTF) issues. 

Despite this knowledge, Ms Orr produced a letter from CBA's risk officer to the remuneration committee that read:

In summary, for the financial year ended 30 June 2016, I do not believe there to be any risk issues or risk behaviours that would suggest STI awards should be modified from that recommended based on other achievements or results.

Ms Livingstone conceded that this was inappropriate, as were a number of remunerations that had happened since;  however, she did defend CBA's remuneration model, in particular the weighting of total shareholder return on executive rewards. 

Ms Orr pointed out that an APRA information paper was released that expressed concern about using the total shareholder return to determine remuneration. 

“As a result of that paper did you reduce your reliance on total shareholder return?” said Ms Orr.

“No, we haven’t,” said Ms Livingston. 

Ms Orr then asked if the 2017 executive remunerations were appropriate given CBA knew about the fees for no service that had been made public, the enforceable undertaking in relation to foreign exchange trading and that ASICs investigation into life insurance had mostly concluded. 

“I think in hindsight, we could have done a greater risk adjustment on several executives, including to zero,” said Ms Livingstone.


No evidence to back up Livingstone’s claims
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Eliot Hastie

Eliot Hastie

Eliot Hastie is a journalist at Momentum Media, writing primarily for its wealth and financial services platforms. 

Eliot joined the team in 2018 having previously written on Real Estate Business with Momentum Media as well.

Eliot graduated from the University of Westminster, UK with a Bachelor of Arts (Journalism).

You can email him on: [email protected]

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