FAQ: How the Australian Financial Accountability Regime (FAR) will affect CIOs

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As part of its response to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, the government is planning to expand its executive accountability regime.

The transformation of the Banking Executive Accountability Regime (BEAR) into the Financial Accountability Regime (FAR) means that more chief information officers will be subject to rules governing their conduct and their variable remuneration.

What is the Banking Executive Accountability Regime (BEAR)?

The government in 2017 announced that it would introduce legislation to create the ‘Banking Executive Accountability Regime’ (BEAR). The government described the new rules as the biggest overhaul of the Australian Prudential Regulation Authority’s powers since APRA’s formation in 1998.

The rules currently apply to authorised deposit-taking institutions (ADIs); essentially those entities with an Australian banking licence. Major banks were covered by the BEAR from 1 July 2018. From 1 July 2019, small and medium ADI holders were covered.

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