The Australian Prudential Regulation Authority opened consultation on Tuesday on what it called the next phase of a push to strengthen and streamline governance across regulated financial institutions, including draft revisions to its foundational Prudential Standard CPS 510. The announcement, dated 16 June 2026, sets out the first major overhaul of APRA's governance standards in over a decade.
The consultation package covers banks, insurers and superannuation trustees, applying a single governance framework across the three sectors APRA supervises. That cross-sector reach reflects the authority's long-standing preference for consistent expectations on board effectiveness, regardless of the industry in which a regulated entity operates.
SCOPE OF THE DRAFT CPS 510
The draft revisions include new expectations on board composition, tenure, skills and accountability. Those four themes have been at the centre of governance debates in Australian financial services since the Royal Commission and subsequent supervisory reviews, and translating them into hard-edged prudential requirements marks a significant step for APRA.
Under the proposals, boards would be expected to demonstrate that their composition and skills mix are appropriate for the business model and risk profile of the institution. Tenure expectations are likely to have implications for succession planning, particularly at long-established boards where directors have served for extended periods.
Accountability expectations sit alongside the existing regime of individual accountability that has been embedded in Australian banking and, increasingly, in insurance and superannuation. By writing sharper accountability expectations into CPS 510, APRA is looking to reinforce the link between board decisions and prudential outcomes.
FIRST MAJOR OVERHAUL IN OVER A DECADE
APRA said the package represents the first major overhaul of its governance standards in more than a decade. The existing regime has been amended incrementally, but the June consultation opens a broader reset intended to reflect lessons learned from prudential incidents and enforcement action across the Australian financial system.
The authority has framed the reforms as being about both strengthening and streamlining governance, signalling an intent to consolidate overlapping requirements alongside the introduction of tighter expectations. That dual objective may prove attractive to boards and company secretaries who have long complained about the volume and complexity of prudential guidance in this area.
For directors of regulated institutions, the draft standard has the potential to reshape board evaluations, skills assessments and appointment processes. The changes could feed into how nomination committees identify and refresh directors, and how boards report on the effectiveness of their own governance to shareholders and members.
The proposals cover superannuation trustees alongside banks and insurers, extending the reset to a sector that has been the focus of intensified prudential and conduct scrutiny in recent years. Aligning trustee governance expectations with those applied to banks and insurers reinforces APRA's message that superannuation is held to the same standards as the rest of the regulated financial system.
APRA said it would consider all feedback received through the public consultation process before finalising the revised standard. The authority typically publishes response papers summarising the submissions and outlining any adjustments before issuing revised prudential standards, and industry associations are expected to engage closely with the draft in the months ahead.