Two years into its remedial action plan to improve the management of its non-financial risk, Commonwealth Bank is making “strong progress in executing the plan”, according to an independent review of the process. However, its greatest hurdles lie ahead.

Promontory Australia said CBA has passed around two-thirds of the milestones in the plan, which is based on Australian Prudential Regulation Authority recommendations that form part of an enforceable undertaking the bank gave in 2018.

APRA started an inquiry in 2017, to examine whether governance, culture and accountability practices at the bank had contributed to a “series of incidents” that had resulted in regulatory scrutiny.

The regulator’s remedial action plan covers board governance, management governance, the operating model, risk appetite, accountability and controls, customer outcomes and culture.

In its latest review, Promontory said: “We have perceived a material change in the attitudes and culture within CBA over the two years since the start of the program.

“There is now a clear and committed leadership from the top in managing non-financial risk. Accountabilities have been sharpened. The ‘voices’ of risk and compliance have been elevated and are being heard,” Promontory said.

“There is a much clearer and stronger focus on ensuring good customer outcomes.” This includes the development of a “customer connection experience”.

But Promontory cautioned that “the greatest hurdles lie ahead”, with some of the remaining milestones the most difficult. In part, this is because many of the milestones are moving from design to execution.

Another concern is that banks staff are starting to suffer from “change fatigue”, especially with COVID-19 changes coming on top of the remedial action plan.

The bank has taken steps to fix “resourcing constraints” and “consistency issues” in some parts of the group but lack of consistency remains a concern, with several instances of variations in the implementation of the program across business units.

In one case, Aussie Home Loans was slow to implement certain aspects of the program.