More robust governance recommended in RBA report

Governance Institute of Australia has welcomed recommendations for more robust governance at the Reserve Bank of Australia as part of a major independent review.

The review has made 51 recommendations which have been accepted by the Federal Government including:

• The creation of a Governance Board to increase oversight and accountability on corporate governance matters at the RBA
• A clear division of responsibilities between Governance, Monetary Policy and Payments SystemsExternal Governance Board members to be appointed through a transparent process, with a diverse set of skills and experience
• Greater transparency and better communications around key decisions
• Governance Institute CEO Megan Motto said governance structures can’t be ‘set and forget’ and need to be monitored and adapted to fit rapidly changing environments.

‘Good governance frameworks are essential to reducing risk, improving transparency and accountability to ensure trust is maintained in our major public institutions, especially those as important as the RBA,’ she said.

The report also calls more a more diverse set of skills and experience required on the three separate boards.

‘We know through our own Board Diversity Index that broader gender, cultural and experiential diversity leads to better decision-making processes for all, and better represents the community that an organisation serves,’ Ms Motto said.

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