Wider community no longer trusts corporates, former bank boss says

Former bank boss John Mulcahy has warned corporate Australia it needs to lift its behaviour to restore community trust.

Mirvac chairman John Mulcahy at his Sydney office.

Former banking boss John Mulcahy has warned corporate Australia it would need to lift its behaviour to restore community trust ahead of a potentially bruising final round of the banking royal commission, starting today.

Mr Mulcahy, a former chief executive of Suncorp — one of the financial institutions already battered by the royal commission — and a Future Fund director said a “trust deficit” had opened between business and the wider community.

“We have seen recently what can happen when communities lose faith in institutions that were previously pillars of trust,” Mr Mulcahy told investors in the property company he now chairs, Mirvac, on Friday.

“Poor behaviour lets us all down and all corporates have a responsibility to be better.”

He said big business not only had a responsibly to investors but also to the wider community and its staff, while property companies in particular had a responsibility to the environment they effected. “We have seen recently what can happen when communities lose faith in institutions that were previously pillars of trust,” he said.

“Poor behaviour lets us all down and all corporates have a responsibility to be better.

“But being a better corporate citizen cannot be a box-ticking exercise. It is not a policy to be invented in a boardroom and then implemented overnight,” said Mr Mulcahy, who became chairman of the $8.2 billion developer and fund manager in 2013.

His comments came ahead of the final fortnight of hearings to be held by royal commissioner Kenneth Hayne, which will hear from bank chief executives and chairmen. The hearings resume this morning in Sydney for a week of grilling executives from the Commonwealth Bank, Westpac and Macquarie Group.

It is understood CBA chief executive Matt Comyn will be the first witness in the stand, with chairman Catherine Livingstone tipped to appear as early as today or tomorrow. NAB chairman and former Treasury secretary Ken Henry is expected to give evidence when the commission travels to Melbourne next week.

It will be the first time Macquarie has appeared before the commission, with the so-called “Millionaire’s Factory” so far avoiding the inquiry’s hotseat ­despite a string of scandals including financial planning rip-offs and its alleged involvement in a German tax rort.