Prudential regulatory risk governance of IT multi-sourcing strategies within the Australian banking sector

Strong, Brian and Cater-Steel, Aileen and Lane, Michael (2014) Prudential regulatory risk governance of IT multi-sourcing strategies within the Australian banking sector. In: 25th Australasian Conference on Information Systems (ACIS 2014): Integral IS: The Embedding of Information Systems in Business, Government and Society, 8-10 Dec 2014, Auckland, New Zealand.

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Abstract

Banks employ different IT sourcing strategies to reduce IT costs. Australian banks are highly regulated by the Australian Prudential Regulatory Authority (APRA). We selected the two largest Australian banks, Westpac Banking Corporation (WBC) and Commonwealth Bank of Australia (CBA) to investigate the complexity of their IT multi-sourcing models and associated risks. We analysed public documents to reveal the IT sourcing trends from 2009 to 2013, and compared the alignment of the banks' risk frameworks with the APRA risk framework. Finally we reviewed APRA's risk management at the finance industry level and identified that neither risk management nor governance is performed and/or reported by APRA to the Reserve Bank of Australia. Therefore to ensure the cumulative effect of the banks' IT sourcing strategies are measured and reported at the industry level, it is recommended that APRA develops and implements an industry-level risk framework mirroring standard APS 115.


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Item Type: Conference or Workshop Item (Commonwealth Reporting Category E) (Paper)
Refereed: Yes
Item Status: Live Archive
Additional Information: Open access. This publication is copyright. It may be reproduced in whole or in part for the purposes of study, research, or review, but is subject to the inclusion of an acknowledgment of the source.
Faculty / Department / School: Current - Faculty of Business, Education, Law and Arts - School of Management and Enterprise
Date Deposited: 19 Jan 2015 04:57
Last Modified: 09 Jun 2017 01:19
Uncontrolled Keywords: IT multi-sourcing; offshore-outsourcing; operational risk; Australian banks; Australian Prudential Regulatory Authority
Fields of Research : 15 Commerce, Management, Tourism and Services > 1502 Banking, Finance and Investment > 150203 Financial Institutions (incl. Banking)
15 Commerce, Management, Tourism and Services > 1502 Banking, Finance and Investment > 150205 Investment and Risk Management
08 Information and Computing Sciences > 0806 Information Systems > 080609 Information Systems Management
Socio-Economic Objective: E Expanding Knowledge > 97 Expanding Knowledge > 970108 Expanding Knowledge in the Information and Computing Sciences
B Economic Development > 89 Information and Communication Services > 8999 Other Information and Communication Services > 899999 Information and Communication Services not elsewhere classified
URI: http://eprints.usq.edu.au/id/eprint/26234

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