pc
nid 93268
Jun 16, 2026
kgurnani@vixio.com
Australia
Australian Prudential Regulatory Authority
financial services
110% of draft length
draft in Generated
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2185 charsAustralian Prudential Regulatory Authority Commences Final Phase of Governance Requirements Review
On June 16, 2026, the Australian Prudential Regulatory Authority (APRA) commenced the final phase of its governance review by publishing updated requirements designed to strengthen governance across banking, superannuation, and insurance. APRA began consulting on proposals to modernise its governance requirements in March 2025 and refined some proposals in October 2025. The authority has now published a response to industry feedback alongside an updated draft of Prudential Standard CPS 510 Governance for further consultation.
The new CPS 510 reflects contemporary best practice and addresses existing areas of poor practice through several key changes. APRA will strengthen requirements for board governance, conflicts management, and the fitness and propriety of directors and executives. The authority will remove duplicative fit and proper reporting now that Financial Accountability Regime reporting is in place, eliminating forms previously required for approximately 6,000 individuals. APRA will improve flexibility by enabling boards to delegate APRA's board requirements in other prudential standards and by aligning governance requirements with other codes and regimes where appropriate. The standard will harmonise requirements by combining five existing prudential standards into one and setting consistent governance minimums for all APRA-regulated entities. APRA Chair John Lonsdale said the new requirements will raise expectations for boards and senior leaders while freeing them to focus on matters most essential to financial and operational resilience. The changes aim to ensure regulated entities have leaders capable of responding decisively to financial stress and operational disruptions during periods of rising economic and geopolitical uncertainty.
APRA will consult on the draft CPS 510, the proposed removal of routine fit and proper reporting, and related definitional changes in Prudential Standard CPS 001 Defined terms until August 31, 2026. Feedback from consultation and stakeholder meetings will inform the final standard and related guidance, planned for release in late 2026. APRA expects the new requirements to take effect from early 2028.
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2403 charsAustralian Prudential Regulatory Authority Commences Final Phase of Governance Requirements Review
On June 16, 2026, the Australian Prudential Regulatory Authority (APRA) commenced the final phase of its governance review by publishing updated requirements designed to strengthen governance across banking, superannuation, and insurance.
APRA began consulting on proposals to modernise its governance requirements in March 2025 and refined some proposals in October 2025. The authority has now published a response to industry feedback alongside an updated draft of Prudential Standard CPS 510 Governance for further consultation.
They key proposed changes include:
Stronger board governance requirements: APRA proposes more explicit expectations for boards to:
Demonstrate effective oversight of the institution's strategy, risk profile and long-term resilience.
Maintain appropriate skills, experience and diversity across directors.
Regularly assess board performance and effectiveness.
Ensure directors have sufficient capacity to discharge their responsibilities.
Enhanced board skills and succession planning: Boards would be required to:
Maintain documented succession and renewal plans.
Identify and address skills gaps.
Regularly evaluate whether board composition remains appropriate for the institution's risk profile and strategic direction.
Increased focus on organisational culture: A significant feature of the draft is a greater emphasis on:
Risk culture.
Conduct and behavioural expectations.
Board oversight of culture-related risks.
Ensuring remuneration and incentives support prudent risk-taking.
Strengthened conflict-of-interest management: The draft introduces more detailed expectations regarding:
Director independence.
Management of actual, perceived and potential conflicts.
Governance arrangements for complex group structures.
Clearer accountability for senior executives: Boards would need stronger oversight of:
Senior executive appointments.
Performance assessment.
Succession planning.
Accountability mechanisms for key executives.
Greater emphasis on group governance: For entities operating within broader corporate groups, APRA proposes clearer requirements around:
Group-wide governance frameworks.
Responsibilities of the parent board.
Oversight of material risks arising from non-regulated subsidiaries and affiliates.
Companies can send feedback by August 28. 2026. APRA expects the new requirements to take effect from early 2028.