'What we've got here is failure to communicate.' — Cool Hand Luke, 1967
I spent Tuesday evening in my local pub with a retired professor of social work, and coming a miserable second in a disputable round of trivia, won by a table of barristers, or more probably baristas.
It was a wretched end to a lively conversation between myself and the said retired professor who had asked for my opinion and then explained to me it was incorrect; that my optimism and delight in Hayne's refusal to smile, shake hands, pass over his printed volumes of his final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry to, or even look at Deputy PM Josh Frydenberg during their exquisitely awkward and politely disdainful 'press event', aired on the news 1 February, was, in other words, mistooken.
My friendly academic, in whom I am generally very well-pleased, explained to me and to his neighbour, the sympathetic professional artist who painted my portrait (on commission) for the Archibald in 1997 when my opinions were sometimes respected, made a diligent and well-argued case that Hayne had failed in his task which, the retired professor thought, was to 'tackle bank structure'.
With the greatest of respect, notwithstanding the surge in the stock exchange that followed the report's publication, and despite the criticisms from even those such as John Warhurst and so many others on Twitter and other social media, this was not the job his former honour had to do. To imagine otherwise is to misunderstand both the law, and what it is 'meant' to do in the hands of those who are judicially trained.
The Hon. Kenneth Hayne AC was appointed to the Victorian Supreme Court in 1992, then to the High Court in 2007 (by John Howard), stepping into Sir Daryl Dawson's patrician shoes and setting an admirable record of decision-making, before retiring in 2015. The Hon. Kenneth (if I may so familiarly call him) came from a classic Melbourne background (though mistakenly born in Gympie, Queensland): Scotch College, Melbourne University, Exeter College, Oxford-educated and a former Rhodes Scholar (smarter and harder-working than the Hon. Tony Abbott, former PM).
What are 'mistooken' are the expectations of a royal commission, which change nothing because they are not meant to do so: think the royal commission into Aboriginal deaths in custody, now more than 31 years ago, and its 'influence' on the massive improvement in the rate of imprisonment and premature deaths of Indigenous children, women and men throughout this proud nation; and the long-lasting effects of the Fitzgerald Inquiry in Queensland. And think again, and remember the spit-hooded boy who graduated from Donvale in the NT, still containing a 100 per cent population of Indigenous boys.
A 'royal commission' is just an investigation which makes recommendations that can't be acted on unless either its creator, the government of the day, the parliament of the day, or a judge in a court, after established constitutional practices and conventions (though these have been mangled of late), so decide.
"This obvious approach may be, perhaps, the only way to ensure there is no reasonable likelihood of co-opting that office holder, and that there is, as there must be, an external monitoring role."
A royal commission is described in a 1902 act as having 'powers', but these are only to cause summons to be issued to make people appear and give evidence or product documents; swear oaths, and go to jail if they refuse either. But they only conduct executive inquiries into and seek to establish facts because governments cannot or will not do so in the ordinary course of business. And they can ignore them.
This particular royal commission was, we now know, provoked by a Four Corners expose of a sales culture in the Commonwealth Bank and its failure to protect the interests of its customers, its ethics, governance rules and even the law. Its terms of reference, once the banks themselves wrote them, were designed to be limited and the commissioner had only a year to do what could be done with them and his little band of barristers.
And they did it brilliantly, in my humble opinion — because the honorable commissioner was a judge in the best tradition of independence of the courts and the judiciary, and an understanding of the law's purpose — to create order out of the morass of human greed, selfishness, risk-taking and influence-peddling that comes with mixing with the moneyed and those who worship it.
The rule of law is about imposing order and the public trust that institutions consist of human beings who care about other human beings and the common good. What a challenge, given the dirt and the sense of entitlement even the banks could not resist exposing during the hearings process.
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My closest legal colleague of these days of my twilit legal career and I had a chat as I was writing this piece. She proposed the following fix for the whole system. I offer it for the public to demand, in the lead-up to the nastiest election I have apprehended for some years.
My very senior and downright conservative employment lawyer friend says that every bank (and similar) should be obliged to fund an 'ethics and compliance' position, which is also an internal whistleblower position, reporting to ASIC and APRA and to the ATO, with a dotted line report to its board (as an ex officio member), who must present a report every quarter, and who is entitled to conduct adequately funded and resourced investigations under the aegis of the relevant authority, if and when something concerning arises, and the hosting body fails or refuses to act appropriately.
Effectively the conscience of the community, nay the 'soul' of this 'legal person' with its tellingly-named 'human resources' approach to its staff, and its profit-oriented KPIs, this modestly remunerated officer would sit within her or his bank for a fixed term, terminable only by an address of both houses of Parliament — rather as a judge can be only removed for an inconvenient decision or alleged misconduct.
This obvious and, we joyously agreed, simple approach may be, perhaps, the only way to ensure there is no reasonable likelihood of co-opting that office holder, and that there is, as there must be, an external monitoring role. As they may sit in on the board, ex officio, they could make recommendations based on the conduct of executives, for example, on whether or not bonuses should be awarded having regard to their upholding standards of ethical behaviour and not with regard to upholding the value of shareholders.
She says, am I a genius? and I say, the Honourable Haynes would never suggest any such simple, smart, cost-effective remedy, but might watch, and wait, for the response to such a proposal. When we embraced 'corporations law', we abandoned not only humanity, but also the idea of the true value of the human person, as employee or client or investor or insured. It is one way to reinvest authority not in a 'legal person' with no soul, no concept of values other than shareholder entitlements, and no bottom to kick if 'the culture' it creates goes rotten.
Banks would die in a ditch to stop this. And neither party will support it. But one of them should. What we have here, is a failure to communicate a universal truth.
Moira Rayner is a barrister and writer. She is not a member of any political party. She is a barrister and solicitor of 47 years standing who was once accused — and acquitted — of attempting to pervert the course of justice. She believes only way to prevent vast, interlinked power relationships from being misused is to make their exercise transparent, publicly accountable, supported by legislation.
Main image: Robert Cianflone/Getty Images