During 2019–20 Suncorp sharpened its focus on managing conduct risk and developing a risk culture that embeds risk awareness, transparency and accountability at every level, and exemplifies responsible and ethical behaviour. Doing the right thing by our people, our customers, our shareholders and the community is our priority, and core to sustaining long-term financial performance.
In 2019-20 Suncorp undertook an independent Group-wide culture assessment to better understand our current culture and identify opportunities to shift the culture to more effectively deliver on our strategy. The survey highlighted the willingness of our people to do the right thing by our customers and build trust, and the care they have for each other. More than 89 per cent of people noted that compliance requirements were a priority, while the survey also identified areas for improvement such as delivering greater clarity and connection to our strategy, and driving a deeper understanding of how our risk practices support growth and innovation.
Robust management of conduct risk is central to driving the right behaviours at both an individual and organisational level, ensuring we act in the interests of customers and the community and confidence in our organisation is maintained. In 2019-20 we continued to improve our governance, systems, processes, reporting and people practices as key enablers to identifying and managing conduct risk.
We also embedded our online tool, which enables employees to raise issues by lodging risk incidents. Risk culture principles, which outline attributes and behaviours of the risk culture we expect from everyone at Suncorp, have been incorporated into key policies and governance, including Suncorp's Code of Conduct. Suncorp New Zealand’s Conduct Uplift Program continued to improve conduct capability across the business, with more than 70 measures implemented resulting in enhanced product and system training, improved readability of our policies and customer communications, and a deeper understanding of customer outcomes and experiences.
#Code of Conduct
Our Code of Conduct sets out the standards of behaviour we expect from our people, and guides how we work together, make decisions and meet our customers’ needs. It is guided by our cultural principles of doing the right thing, being courageous, and caring for others.
In 2019-20 Suncorp refreshed its Code of Conduct to be easier to understand and more reflective of the current regulatory environment. Our refreshed Code of Conduct helps bring our purpose to life and is guided by our cultural principles. It is aligned to our Risk Culture Principles, the General Insurance Code of Practice and the Banking Code of Practice, with strengthened focus on supporting customers experiencing financial difficulty or vulnerability, transparent customer communications, and taking ownership of good customer and community outcomes. Changes to elevate the importance and weighting of the risk category in the Group Scorecard structure were approved by the Board. Throughout the year, all executive and non-executive employees’ performance assessments included confirmation of their adherence to the behavioural standards outlined in Suncorp’s Code of Conduct.
In 2019–2020, Suncorp’s Consequence Management Framework was introduced to strengthen the link between conduct and individual performance and reward outcomes. During the year, there were 239 Code of Conduct breaches identified that resulted in formal consequences, including 66 employees leaving Suncorp, 28 employees receiving nil variable rewards; and the remaining 145 employees receiving a minimum 20 per cent reduction in variable rewards.
During 2020 Suncorp partnered with the Ethics Centre to create an Ethical Decision-Making Masterclass for all leaders. The program complements Suncorp’s Code of Conduct, and helps participants develop and apply ethical knowledge and skills to all decision making. It positions leadership as an ethical practice, enhances awareness of ethical blind spots and biases, and provides tools for navigating daily decisions. Using a scenario-based approach, leaders apply an ethical lens to navigate complex decisions and are encouraged to consider the impacts on a range of stakeholders.
Suncorp is committed to a fair, transparent and responsible remuneration framework. The Board ensures Suncorp’s remuneration arrangements are strategically aligned and reinforce executive accountability, responsible business practices, effective risk management, as well as drive a company culture.
In late 2019, Suncorp initiated an internal review of pay and leave entitlements, with early analysis of historical data indicating inconsistencies in relation to the Group’s rostering and pay systems. This may have led to errors in payments of overtime, shift penalties and public holiday loadings. The analysis to date identifies potential instances of underpayments and overpayments. The review is ongoing.
The Board Risk Committee is overseeing the review and is convening regular meetings to closely monitor progress; ensure remediation processes are timely and accurate and are communicated with employees and shareholders upon completion; and ensure new processes are sufficiently robust so that this does not reoccur.
Increasing the transparency of Suncorp’s business activity and non-financial performance is key to meeting customer and community expectations. In recent years we have improved disclosure of our corporate responsibility objectives, performance highlights and future activity. We now publish key non-financial performance targets and performance against these targets annually. These targets span customer, people, community, environment and value chain metrics, and are an important part of our ongoing communication with stakeholders.