2017

ANNUALREVIEW

ANZ 2017 ANNUAL REVIEWWE WANT OUR CUSTOMERS TO VALUE US AND THE COMMUNITY
TO TRUST US. FOR THIS TO HAPPEN WE KNOW THAT THINGSNEED TO CHANGE AT ANZ.
This Annual Review tells the story of the changes we are making. Why we’re here, the benefits
we bring, the challenges we face and what the future holds.

Cover story — Latrobe Valley Bus Lines
Rhonda Renwick and her dedicated team at Latrobe Valley
Bus Lines are rolling out new buses that are at the leadingedge of transport technology in Australia.
Since 2015 Latrobe Valley Bus Lines has been investing in
low emission technologies which improve the efficiency andenvironmental impact of its buses.
The newest vehicles in the fleet have been designed todramatically reduce particulate emissions in the atmosphere.
Latrobe Valley Bus Lines has been trialling new hybrid technology
and will introduce eight new hybrid vehicles into the fleet overthe next three years.
As the company focuses on its mission of helping the community,and providing the highest quality and safest service for its
customers and employees, it has benefitted from its long-term
relationship with ANZ.

Rhonda Renwick, Managing Director

We are proud to be supporting a business like Latrobe Valley
Bus Lines — a Certified B Corporation — which shares ourcommitment to helping communities thrive. It supports
local manufacturing, is dedicated to fostering an inclusive
and safe workplace and promotes a number of grassrootscommunity organisations.

“ANZ’s proactive team has a genuine understanding of ourbusiness goals, providing flexibility along with competitivebanking options,” Rhonda explains.

CONTENTS2

Our 2017 Reporting Suite

3

Our External Environment

162017 Highlights

4

Our Strategy

18

Chairman’s Message

6

Governance

22

CEO’s Message

8

Remuneration Overview

28

About our Business10

Five-year Summary

32

What Matters Most				12

Shareholder Information

33

How we Create Value

14

OUR 2017 RERPORTING SUITEOUR 2017
REPORTINGSUITETHIS IS A REPORT ABOUT HOW WE CREATE VALUE —­ FOR
SHAREHOLDERS, CUSTOMERS, EMPLOYEES AND THE COMMUNITY.
About this report
We recognise that stakeholders want a more holistic
understanding of how we are creating value — beyond theshort or medium-term — and the opportunities and challenges
impacting our future. That is why this year’s Annual Review
marks the start of our progression towards integrated reporting.
A strong financial performance each year, while critical to thesuccess of the bank, is not of itself the whole story and does not
fully reflect who we are as an organisation and the role we playin society.
The aim of this Review is to communicate transparently andconcisely about how we manage our business, including the way
in which we incorporate social and environmental considerations
into our decision-making. We have drawn on aspects of theInternational Integrated Reporting Framework to describe how
our business model, strategy, governance and risk-management
processes are addressing our most material issues and deliveringvalue for our shareholders and other stakeholders.
This Review covers all ANZ operations worldwide overwhich, unless otherwise stated, we have operational control
for the financial year commencing on 1 October 2016 andending 30 September 2017. Monetary amounts in this document
are reported in Australian dollars, unless otherwise stated.

We produce a suite of reports to meet the evolving needs
and requirements of a wide range of stakeholders. Our 2017
Annual Report at anz.com/annualreport principally details
our financial information. Our 2017 Corporate GovernanceStatement discloses how we have complied with the ASX
Corporate Governance Council’s ‘Corporate GovernancePrinciples & Recommendations — 3rd edition’. We also provide
our Principal Risks and Uncertainties. Both are available atanz.com/corporategovernance.
In addition, we publish a Corporate Sustainability Review,
through which we inform stakeholders about our performanceagainst our material social, environmental and economic
opportunities and challenges. This report will be available
at anz.com/annualreport in December.
Throughout this Annual Review, KPMG has considered common
content* which will be disclosed in the 2017 ANZ Corporate
Sustainability Review. A copy of KPMG’s assurance statement
over the 2017 ANZ Corporate Sustainability Review is containedin that report.
We will continue to evolve and improve our reporting
suite over the coming years and welcome feedback on
this report. Please address any questions, comments
or suggestions to investor.relations@anz.com.

* Common content includes the following sections: sustainability related 2017 Highlights, What Matters Most, Our Corporate Sustainability Framework, Improving
Our Climate-Related Financial Disclosures and Non-Financial 5-year Summary

2.

There are three other reports available for stakeholders.

1.

1. 2017 Annual Report anz.com/annualreport
2. 2017 Corporate Governance Statement anz.com/corporategovernance
3. 2017 ANZ Corporate Sustainability Review anz.com/cs
Other financial disclosures are available on shareholder.anz.com
3.

3

ANZ 2017 ANNUAL REVIEW2017
HIGHLIGHTS$6.9$3,415M
taxes paid2

BN

11.9
%

cash return on equity1

cash profit1$131M
in community investment(includes foregone revenue)3

1.
2.
3.

4.
5.

4

20%

reduction inGreenhouse Gas
emissions4496,900+
people reached throughour financial education
program MoneyMinded5

Cash profit excludes non-core items included in statutory profit and is provided to assist readers in understanding the result of the ongoing business activities of the Group.
Total taxes borne by the Group, includes unrecovered GST/VAT, employee related taxes and other taxes.
Figure includes foregone revenue of $107 million, being the cost of providing low or fee-free accounts to a range of customers such as government benefit recipients,
not-for-profit organisations and students.
From premises energy against a 2013 baseline.
This is the estimated number of people who have benefited from ANZ’s MoneyMinded financial education program since 2003.

2017 HIGHLIGHTS“THE MARKETPLACE GAVEVISITORS A CHANCE
TO LEARN ABOUT THE
IMPORTANT JOB OUR
LOCAL FARMERS DO IN
PRODUCING OUR FOOD”— Christine Linden, General Manager,
Regional Business Banking, ANZ
During the year we held a Regional Marketplace at ourhead office in Docklands, where staff and visitors had
the opportunity to sample and purchase the produceof several of our Victorian and Tasmanian customers.

160

113,127hours volunteered

fully franked dividend for FY17

under-represented groups6

by employees

CENTS
NET PROFIT
AFTER TAX
$M

$6.9 BNfunded and facilitatedin low carbon andsustainable solutions
since 2015

5,709

2016

6,406

2017

12%
6.
7.

250
people employed fromNET PROFIT
AFTER TAX
(Cash1)$M

PROFIT
BEFOREPROVISIONSAND INCOME
TAX (Cash1)$M
11,041
10,155NET
LOANS ANDADVANCES7
$BN

2016

2016

575.9

CUSTOMERDEPOSITS7
$BN

580.3
449.6

467.6

6,938
5,889

2016

2017

18%

2017

9%

2017

1%

2016

2017

4%

Includes Aboriginal and Torres Strait Islander people, people with a disability and refugees.
Includes assets and liabilities held for sale.

5

ANZ 2017 ANNUAL REVIEWCHAIRMAN’SMESSAGEDAVID GONSKI, AC

I am pleased to introduce
our first Annual Review, whichbrings together reportingon our financial performanceas well as a broader story
about the benefits we bringto our stakeholders andthe wider community.
This reflects our first steps towards comprehensively
describing how our strategy creates value, and thechallenges and opportunities we face in the short,medium and longer term.
In 2017 ANZ produced good results for shareholders,our customers and the communities in which we operate.
Financial OutcomesOur statutory profit was $6.4 billion, up 12%. Cash profit (which
excludes non-core items from statutory profit) was $6.9 billion,
up 18%. The final dividend of 80 cents per share brought the
total dividend for the year to 160 cents per share fully franked,
unchanged compared to 2016. This reflects a dividend payout
ratio of 68% of cash profit with $4.6 billion in dividends paid
to shareholders, moving ANZ closer to our target fully franked
payout ratio of 60-65% of cash profit.

6

Rapid economic, technological and social changes are a hallmarkof the world we live in. As one of the region’s major banks, wehave a clear strategy, which is being supported by bold action,
to make sure ANZ is fit and ready for this future.
In 2017 we made good progress to becoming a better balanced,
better capitalised and more efficient bank. This has seen the
new shape of ANZ emerge. Our retail and commercial businesses
in Australia and New Zealand now account for 53% of our capital,
up from 44% at the end of 2015. Our Common Equity Tier One
capital ratio reached 10.6% at the end of the year and our cost basehas reduced in absolute terms with annual costs down for the firsttime since 1999.
Community Engagement
Banks are facing significant challenges to re-establish the trustof the community. We need to own up to our mistakes and swiftly
make things right. We have been slower than the community
expects to be more transparent, to listen and to treat our customers
fairly and responsibly.
What is particularly pleasing about 2017 is we have not only
delivered better outcomes for shareholders, we are also making
genuine progress in delivering better outcomes for customers
and in rebuilding community trust.
This has been supported by the establishment of the Responsible
Business Committee, led by the Chief Executive Shayne Elliott,and the revision of the charter for the Environment, Sustainability
and Governance Board Committee (ESG). The aim of both
Committees is to advance ANZ’s core purpose and increase focus
on ESG issues.

CHAIRMAN'S MESSAGE“IN 2017 WE MADE GOOD
PROGRESS TO BECOMINGA BETTER BALANCED, BETTERCAPITALISED AND MORE
EFFICIENT BANK. WE PAID
OUT $4.6 BILLION IN DIVIDENDS.”

We have committed to support the Australian Bankers’
Association Better Banking initiatives and to implementing the
21 recommendations from Stephen Sedgwick’s independent
review of product sales commissions and product-based payments
in Australian retail banking. The Board and the CEO are overseeing
the implementation of the recommendations, with management
providing regular program updates to the Board Human
Resources Committee.
All recommendations are expected to be met within intended
timeframes, with progress this year including; Branch andContact Centre staff incentive plans being changed tobalanced scorecard plans, creating a strong alignment between
performance management and incentive rewards. All rolesin the scope of the Sedgwick review are on track to have thefinancial objective weighting in scorecards at less than 33%
for FY18 and staff recognition programs that were focused onrecognising and rewarding sales outcomes have also beenchanged or closed. We are also working actively with the industry
as part of the Combined Industry Forum in relation to responding
to the Sedgwick recommendations for third parties and ASIC’s
proposals for mortgage broking.
We have also delivered a range of initiatives for customers
to make banking fairer and simpler. For example, in Australia
we have introduced a lower interest rate credit card andremoved ATM fees.
We still have much to do to rebuild community trust,
however we know we need to change and we are changing.

Outlook
We expect the revenue growth environment for banking willcontinue to be constrained as a result of intense competition
and the effect of regulation, including the full impact of the
major bank levy in Australia.
This environment is not new to us and our strategy is ensuring
we focus only on those areas where we can deliver exceptionalcustomer outcomes, solve real customer needs and, in doing
so, make a decent return for our shareholders.
As a result, ANZ’s capital position has improved significantly
and we already meet APRA’s ‘unquestionably strong’ 2020 capitaltarget. In 2018, as we receive the proceeds from the alreadyannounced divestment of non-core businesses, we will havethe flexibility to consider capital management initiatives.
As we continue to deliver the benefits of our strategy, we are
well positioned to create value for our shareholders, customers,
employees and the community in 2018 and beyond.
The Board is pleased with what has been achieved in 2017
and takes this opportunity to thank all of the employeesof ANZ for their hard work and dedication.

David Gonski, AC
Chairman7

ANZ 2017 ANNUAL REVIEWCEO’SMESSAGESHAYNE ELLIOTT

Two years ago it was clear that weneeded to reshape ANZ’s future.
We had a strong and successful
business, however in recent times
the external environment waschanging faster than we were andour customers, the communityand our shareholders expectedmuch more from us.
Our Strategy
To ensure ANZ adapted more quickly, we simplified our strategy
to focus on being the best bank for people who want to buy andown a home, and for people who want to start, run and grow abusiness. In Institutional Banking, we want to be the best bankin the world for customers who move goods and money aroundthe Asia-Pacific region.
This allowed us to focus our resources on opportunities where
we have a competitive advantage and can win. However, wehave also made some difficult calls. Some say the essence ofstrategy is choosing what not to do. We have chosen to sellbusinesses or investments where we were not in a winning
position or developing our ANZ brand, or where they added
unnecessary complexity and risk.

8This has included the divestment of our pensions and investments
business in Australia, our retail and wealth businesses in six Asian
countries, UDC asset finance in New Zealand, and our minority
investments in China’s Shanghai Rural Commercial Bank andMetrobank Card Corporation in the Philippines.
These choices have also involved a significant reshaping of ourInstitutional Banking business as part of improving the capital
allocation and improving returns. This year it has involved a further$18 billion reduction in Credit Risk Weighted Assets, bringing thetotal reduction since September 2015 to $46 billion or 27%. We arealso focusing on a smaller number of customers who most value
our capabilities and our network, including our presence in Asia.
Today, we are at the mid-point of executing a multi-year
transformation of ANZ and I am pleased to report that 2017 has seen
better outcomes for shareholders and genuine progress in delivering
better outcomes for customers and in rebuilding community trust.
Customers and the Community
For customers our progress includes initiatives to make banking
fairer and simpler supported by an increased emphasis on
innovation. For example, we extended our mobile payments
leadership, established with Apple PayTM and Android PayTM,
with the launch of Samsung Pay and FitBitTM Pay. Mobile
payments are also important for small business and we
introduced BladePayTM to support this growing opportunity.
We also believe in the value of voice-activated transactions andlaunched MyVoice identity and security solutions in Australia and
New Zealand.

CEO'S MESSAGE“I WANT US TO BE KNOWN
AS A COMPANY THAT’SRESPECTED FOR BEING FAIRAND BALANCED IN THE WAY
WE THINK ABOUT ISSUES AND
FOR TAKING ACTION TO MEETTHE EXPECTATIONS OF OUR
CUSTOMERS, EMPLOYEESAND SOCIETY.”

We are also rebuilding trust through a focus on our core purpose:to help shape a world where people and communities thrive.
We invested more than $131 million in the communities inwhich we operate and I am particularly proud of the impact our
financial education and employment programs are having interms of creating opportunities for more people to participate
socially and economically.
We are focused on creating the right culture to support our
strategy. The way in which we treat our stakeholders is reinforcedby our values. Our values ­— the behaviours expected of ourpeople — are not just words on a page. They are embedded
in how we do things, like how we manage and reward ourpeople's performance. They are also used as a foundation forgood decision-making and are embedded in our operating
rhythm, for example, across our Australian Branch Network.
We took a positive and proactive stance at our appearances
before the Australian Parliament. We have made product, fee
and rate changes to benefit customers and the community andeveryone in the senior management team has spent more timein branches, call centres and regional and rural areas talking
to our customers and the community. Looking ahead, we are
seeking to deliver value to all our stakeholders through four factors:•• Increase digitisation. Focusing on mobile and voice
solutions for customers.
•• Culture. Building a stronger sense of core purpose, ethics
and fairness, and investing in people who can sense andnavigate the rapidly changing world.
ANZ today is leaner, stronger and fitter; better placed to manage
the changing environment while still investing in new capabilities
to deliver long-term sustainable earnings growth.
We could not have achieved so much in 2017 without the sustained
effort and dedication of our people, and I thank them all for
their contribution.

Shayne Elliott
CEO•• Simplicity and focus. Choosing a few things to do, doing
them extremely well and stopping everything else.
•• Speed to market. Listening to customers, testing, developing
and launching solutions quickly and repeating at pace.

9

ANZ 2017 ANNUAL REVIEW

ABOUT
OUR
BUSINESSOUR PURPOSE
Our purpose is to help shape a world in which people and communities thrive. That means striving to create a balanced, sustainable
society in which everyone can take part and build a better life.
One of our key strategic priorities is to drive a purpose and values-led transformation of the bank and our progress towards this isdiscussed thoughout this report.

OUR CULTURE
AND VALUESOUR CORPORATESUSTAINABILITY FRAMEWORKOur values are the foundation of how we work and how
we bank. We recognise that we must live our values every day
if we are to execute our strategy successfully and earn backthe community’s trust.

Our Corporate Sustainability Framework supports our businessstrategy and is aligned with the bank’s purpose. The Frameworkhas three key areas of focus:

To support our strategic priority to drive a purpose andvalues-led transformation of the bank, this year we refreshed ourvalues with input from more than 1,000 employees. Our values,
which include a strong focus on speaking up and respectfully
disagreeing, are supported by our Code of Conduct and Ethics.
It is a requirement that all employees comply with the Code,which contains eight guiding principles and sets the standards
for the way we do business at ANZ.

• Social and Economic Participation• Sustainable Growth• Fair and Responsible Banking
which are discussed further on page 20.

We care about:

INTEGRITYCOLLABORATIONACCOUNTABILITYRESPECTEXCELLENCE

10

SUSTAINABLE
GROWTHSHAPE AWORLD WHEREPEOPLE AND
COMMUNITIESTHRIVE

SOCIALAND ECONOMICPARTICIPATIONFAIR ANDRESPONSIBLE
BANKINGABOUT OUR BUSINESSFounded in 1835 and headquartered in Australia, we provide banking and financial
products and services to individual and business customers, operating across 34 markets.

~8
millionRetail, commercial andOUR DIVISIONS
Our business is structured across the following divisions:
Australia: comprises the Retail and the Corporate andCommercial Banking business units, providing a fullrange of banking services.

instituitional customers

Institutional: services global institutional and businesscustomers located in Australia, New Zealand, Asia,
Europe, America, Papua New Guinea and the Middle
East across three product sets: Transaction Banking,Loans & Specialised Finance and Markets.

44,896Full-time equivalent employees

New Zealand: comprises the Retail (including wealthmanagement services) and Commercial business units
providing a full range of banking services.

$86.9 billion

Wealth Australia: provides investment, superannuation,
insurance and financial advice services.

Market capitalisation

Asia Retail & Pacific: comprises the Asia Retail andPacific business units, connecting customers to specialists
for their banking needs.

520,000+
Shareholders. 58% of ANZ’s shares

Digital banking: leads the strategic development and delivery
of a superior digital experience for the bank’s customers
and staff.

1

are held by Institutional investors
and the remaining 42%1 by
Retail investors.

These divisions are supported by Group-wide functions
including Technology, Services & Operations andGroup Centre.

ANZ is listed on the Australian Securties
Exchange (ASX) with a secondary listingon the New Zealand Exchange (NZX).

For information on the performance of the above divisions
see page 21 of the 2017 Annual Report.

1.

EARNING COMPOSITION BY GEOGRAPHY

OUR
INTERNATIONAL PRESENCE
Australia

Based on beneficial ownership.

New Zealand$1,740 million



New ZealandAustralia$4,617 million

International
Asia
Cambodia, China, Hong Kong,
India, Indonesia, Japan, Laos,
Malaysia, Myanmar, the Philippines,
Singapore, South Korea, Taiwan,
Thailand, Vietnam

EuropeFrance, Germany, United Kingdom

International$581 million

Pacific
American Samoa, Cook Islands,
Fiji, Guam, Kiribati, New Caledonia,
Papua New Guinea, Samoa,
Solomon Islands, Timor-Leste,
Tonga, Vanuatu

Middle East U.A.E. (Dubai)
United States of America
11

ANZ 2017 ANNUAL REVIEWWHAT
MATTERSMOST
OUR MOST
MATERIAL ISSUES
Our annual materiality assessment is informed by engagementwith internal and external stakeholders. The assessment builds
a clear picture of those issues that have the most potential toimpact our value creation. These issues may change over time,reflecting developments in our business and external operating
environment and the changing expectations of stakeholders.
We use the results of the assessment to inform our strategy,reporting and sustainability targets.
This year, stakeholders ranked the following issues (risks oropportunities) as having the most potential to impact ourvalue creation in the short, medium and long-term:	Fairness and ethical conduct: remains the highest
ranked issue. This year our stakeholders told us towork harder to 'get it right every time’, strengthen our
processes, lend responsibly and prevent conduct issues.
	Fraud and data security: while continued digital
innovation was identified as a priority, associated withthis was the ongoing need to educate customers andthe wider community about online risks and what
they can do to improve their own data security
and cyber safety.

	Responsible business lending: ranked in the top
three again this year, with stakeholders noting that
expectations have heightened. Stakeholders spokeof the importance of engaging with our businesscustomers to ensure the social and environmental
impacts (including those related to human rights
and climate change) of their operations are minimised.
Our business customers also reminded us that policychanges can restrict the availability of capital, in turnpotentially impacting their competitiveness and thestrength of the economy. NGOs emphasised theimportance of reducing the emissions intensity of ourbusiness lending portfolio.
	Customer experience: customers told us that if they
believe their success is important to ANZ and they
feel valued by ANZ, they will stay with us. Stakeholders
also highlighted fairness, transparency and simplicity
of products as central to building customer andcommunity trust.
	Digital innovation: remains core to ANZ’s value creation,with employees citing the challenges presented bylegacy systems and inherited processes. It is now more
important than ever that we move at a fast pace to keep
up with digital change and customer expectations or,
better still, lead the way.
The key steps in our 2017 materiality process, as well as thefull list of our material issues, is discussed in detail in our 2017
ANZ Corporate Sustainability Review available on anz.com/cs
in December. Stakeholder engagement (outside of themateriality assessment), including issues raised and how we
responded, is also discussed.

“IT IS INCREASINGLYIMPORTANT FOR BUSINESSESTO ENSURE FAIRNESS IS
PART OF THEIR CUSTOMEREXPERIENCE AMID AN
ENVIRONMENT OF WAVERINGCORPORATE TRUST.”— Colin Neave, Customer Fairness Advisor, ANZ

12

WHAT MATTERS MOST

Effective engagement with all our stakeholders is essential
if we are to understand and respond to their expectations.

MAKING THINGS FAIRER
FOR OUR CUSTOMERSServing our customers fairly and well is at the heartof our business and long-term returns for shareholders.
During 2017 we have undertaken many changes to better
serve our customers and make banking fairer.
In August the CEO wrote to all of our people about 'The ANZ Way',a guide to the way we work and our promises to customers. 'TheANZ Way' makes it clear that we will raise standards in everything
we do, going beyond complying with the law.
We have changed the structure of our branch and call centre
remuneration to a new scorecard that emphasises good
customer outcomes. We are looking to extend this structure toother parts of ANZ, reflecting the spirit of the banking industry’s
Retail Banking Remuneration (Sedgwick) Review.
We have strengthened governance in our mortgage broker
channel and are working with the industry and stakeholders
to improve the structure of broker remuneration.
We are working with other banks to include new consumer
protections in a shorter and simpler Banking Code of Practice,following the recommendations of the Independent Reviewof the Code of Banking Practice. We are re-writing our small
business contracts to make them easier to understand andinclude better protections. We appointed Colin Neave, the former
Australian Commonwealth Ombudsman, as ANZ’s Customer
Fairness Advisor. Mr Neave has developed customer remediation
principles to assure our customers that ANZ will acknowledge
and compensate any failures quickly.
We have strengthened our processes for assessing customers’applications for loans. ANZ will start sharing comprehensive
credit data in the second half of 2018 to help support better
lending practices across the industry.
New industry-wide recruitment and checking processes havebeen implemented to make it difficult for bankers or financial
advisors with proven poor conduct records to move from firm
to firm.
To deliver better quality financial advice, we are doing more
audits using inputs from data analytics and providing improved
training. If we don’t get our advice right, a dedicated ‘Advice
Review Team’ reviews the advice and compensates customers.
ANZ has supported Government reforms that will commencein 2018 such as the 'one stop' Australian Financial Complaints
Authority and the Banking Executive Accountability Regime.
To assist the Government’s Review into Open Banking, wehave suggested a simple and safe pathway for data sharing.
Open Banking will give customers better information on theirbanking services, and make it easier to compare products.

Nathalie Tram, ANZ Docklands

13

ANZ 2017 ANNUAL REVIEW

HOW WE
CREATE VALUEWE AIM TO CREATE VALUE IN EVERYTHING WE DO.
Our business activities create value for ANZ in the form of income, business growth, a positive culture aligned with our purpose
and values, an engaged workforce performing at its best and strong relationships with our stakeholders. The table below presents
the value created for our shareholders and other stakeholders for each of our main business activities.

STAKEHOLDERS
BUSINESSACTIVITIESCUSTOMERSWE HOLDDEPOSITS FOR OUR
CUSTOMERSWE LEND MONEYTO OUR RETAIL,
SMALL BUSINESSAND CORPORATECUSTOMERSWE PROVIDEINVESTMENTS,
SUPERANNUATION
AND INSURANCESERVICES, AND
FINANCIALPLANNING ADVICE•• Making it simple
and easy to for
our customers
to manage theirmoney.

•• Keeping ourcustomers’ money
safe and providing
competitive returns
on deposits.

•• Enabling customers
to buy homes
and businesses toexpand and grow.

•• Assisting businesses
to safely transact,
trade and invest
across the communityand borders.

•• Enabling people
and businesses tosave, manage theirresources and deal
with change.

•• Enabling customers
and their families
to save for the
future and achieve
personal andbusiness goals.

•• Allowing businessand institutionalcustomers tomanage risk
associated with
their businesses.

•• Assisting customers
to manage personaland business risks.

•• Preventing financial
crime and money
laundering.

•• Providing fundingfor housing,
personal lending
and businesses.

•• Promoting tradeand investment,
and the efficient
allocation offinancial resources.

OUR BUSINESSMODEL CONSISTS
OF THE FOLLOWINGACTIVITIES:VALUECREATION
WHICH CREATEVALUE FOR
ANZ, OURSHAREHOLDERSAND OTHERSTAKEHOLDERS:

MATERIAL
ISSUESAND ADDRESSOUR MOST
MATERIAL ISSUES(see page 12)14

WE PROVIDERISK MITIGATIONPRODUCTS TO
HELP CUSTOMERSMANAGE THEIREXPOSURE TO
MARKET VOLATILITYWE PROVIDETRANSACTIONALBANKING SERVICES•• Underpinning
employment,
investment andeconomic growthin the community.
•• Efficiently andresponsibly
allocating financial
resources tomeet customer
and market
demand, andsupport changing
community
expectations.

•• Assisting
communities tomanage social risks.

HOW WE CREATE VALUEEMPLOYEESCOMMUNITYSHAREHOLDERSWE INVEST
IN DIGITALTECHNOLOGY AND
OUR BRANCHESAND OFFICESWE INVEST IN
OUR PEOPLE TO
BUILD A DIVERSE
AND INCLUSIVEWORKFORCE

WE COLLABORATE
WITH PARTNERSTO BUILD CAPACITY
AND IMPROVEFINANCIALWELLBEINGWE INVEST IN
THE COMMUNITY•• Enabling customers
to interact withus how and when
it is most convenient
for them.

•• Enabling us
to provide
better services
and products
to customers,
and meeting
community
expectations.

•• Improving thewellbeing oflower income
and vulnerable
customers,
enabling them toparticipate more
fully in society.

•• Contributing to
the wellbeing of
the community
throughvolunteering andemployee giving.

•• Contributing to
the provision of
public services
such as health,social services
and education.

•• Providing consistent
returns toshareholders.
We are paying 68%
of 2017 cash profit
to shareholders.

•• Promoting diversity
and equality ofopportunity.

•• Contributing
to the ability of
not-for-profit
organisations toassist and support
the community.

•• Supporting
customers andthe community intimes of difficulty,
hardship or natural
disaster.

•• Building trust
through transparent
tax reporting.

•• Enabling shareholders
to save and invest to
meet their personaland business goals.

•• Providing new
digital services thatare valued
by customers.
•• Contributing to
the cyber safety
and security of
our customers.

•• Increasing the skills
and capabilities of
the communities inwhich we operate.

WE PAY TAXESIN THE COUNTRIESWITHIN WHICH
WE OPERATEWE PAYDIVIDENDSTO OURSHAREHOLDERS•• Providing funding
for lending andthe economy, andefficiently allocating
financial resources.

15

ANZ 2017 ANNUAL REVIEWOUREXTERNAL
ENVIRONMENTTHE EXTERNAL ENVIRONMENT IN WHICH WE OPERATE INFORMSOUR STRATEGY AND IMPACTS OUR ABILITY TO CREATE VALUE.

GLOBAL TRENDS
ARE SHAPING
SOCIETY

THESE GLOBAL TRENDSPRESENT US WITH RISKSAND OPPORTUNITIESTechnological change: creating new services and products,
disrupting established industries and reducing barriers tocommunication and trade. Cyber security risks are increasing.
New competitors to traditional banks are emerging.

Innovation and new technologies: present us with
opportunities to innovate and meet the needs of our customers
for digital banking solutions. Competition from existing andnew competitors is increasing and we must be able to respondquickly and improve our digital capabilities. We will need toserve customers in new ways, and continue to strengthen
our cyber security capabilities.

Globalisation: enabled by new technologies, and the freemovement of capital, goods and people — is increasing growthin new economies and restructuring industries in old economies.
Demographic changes: urbanisation, strong population
growth in Australia and New Zealand, and an ageing population
are changing customer demand and reshaping communities.
Strengthening but still uncertain economic conditions:
low wage growth and high levels of debt are contributing
to low rates of economic growth and social unease.
Environment and climate: communities are placing greater
value on protecting the environment and supporting thetransition to a low carbon economy.
Scrutiny of financial institutions: scrutiny of banks andthe financial sector is continuing to increase following
well publicised examples of poor conduct. Concerns
about debt levels in the economy are being raised.

Revenue growth: is expected to be lower than in the past.
With increasing competition and regulatory requirements,
new approaches are needed to generate returns toshareholders and deliver products and services.
Housing: demand for home lending is strong in Australia and
New Zealand as a result of population growth. Community
concerns about housing affordability are high and regulators
are focused on housing lending standards.
Globalisation and the rise of Asia: creates opportunities for ourcustomers to increase their cross border trade and investment.
Increased trade and investment leads to higher incomes andemployment for the communities in which ANZ operates.
Community concerns about aspects of trade and investment
can nevertheless limit opportunities.
Society’s expectations are high: we need to acknowledge
previous poor practice and raise standards across all our activities.
We are expected to strengthen standards on issues such as
human rights and environmental sustainability. We need to focus
on ways we can contribute positively to the wellbeing of thecommunities in which we operate.

16

CASE STUDYOUR STRATEGYSTAUGHTONGROUPWith our help, the Staughton Group has grown impressively overthe past five years, and now employs more than 200 people.
Its growth is supported by a commitment to constant innovation,
increasing efficiency, and a desire to reduce waste. It has spentcountless hours perfecting methods for packing and storing
pet-food in bulk, resulting in the reduction of thousands of kilogramsof packaging that would otherwise be an additional cost andwould end up in landfill.

Edward and Simon Staughton— Staughton Group, a high-quality food manufacturer,
primarily in the pet food market.

OUR STRATEGY AIMS TO RESPONDPOSITIVELY TO THIS ENVIRONMENT
AND MEET SOCIETAL EXPECTATIONSCreate a simpler, better capitalised, better balanced andmore agile bank: we are aiming to reduce operating costs
and risks by removing complexity and exiting low-returnand non-core businesses.
Focus our efforts on areas where we can carve out awinning position: we are making buying and owning a homeor starting, running and growing a small business in Australia
and New Zealand easy. We want to be the best bank in theworld for customers driven by the movement of goods andcapital in our region.
Drive a purpose and values-led transformation of the bank:
we are creating a stronger sense of core purpose, ethics
and fairness, investing in leaders who can help sense andnavigate a rapidly changing environment. We are also looking
to do more to address community concerns about housing,environmental sustainability and financial wellbeing.
Build a superior experience for our customers and our people
to compete in the digital age: we are building more convenient,
engaging banking solutions to simplify the lives of customers
and our people.

As the company has increased in size, our Business Growthprogram has been there to help manage its transition. The results
speak for themselves — not only was the Staughton GroupRegional Exporter of the Year, but Edward Staughton was also
New South Wales Young Entrepreneur of the Year.

“THE CHALLENGING LOCALAND GLOBAL ENVIRONMENTS
MEAN MANY AUSTRALIAN
BUSINESSES ARE LOOKING
TO DIVERSIFY AND THEY'RE
FOCUSED ON WHERE THE
WORLD'S LONG-TERM
GROWTH IS — ASIA. MOREOF OUR CUSTOMERS ARECOMING TO US TO SEEKADVICE ON REGIONAL
DEMAND FOR THEIRPRODUCTS OR SERVICES
AND TO HELP TO
IDENTIFY NEW REVENUEOPPORTUNITIES.”— Mark Hand, Managing Director,
Corporate & Commercial Banking, ANZ

17

ANZ 2017 ANNUAL REVIEWOURSTRATEGYOUR STRATEGY IS FOCUSED ON BECOMING SIMPLER,
BETTER BALANCED AND MORE SERVICE-ORIENTED TO HELPPEOPLE AND BUSINESSES RESPOND TO A CHANGING WORLD.
Successful execution of our strategy will deliver consistently strong results for our shareholders, achieving a balance
between growth and return, short and long-term results, and financial and social impact.

CREATE A SIMPLER,
BETTER CAPITALISED,BETTER BALANCED
AND MORE AGILE BANKFOCUS OUR EFFORTS

FY17 PROGRESSFY17 PROGRESS

Simpler bank:•• Continued to reshape and simplify the organisation, reducing full-time
equivalent staff by 4%, including 6% reduction in senior management.
•• Reduced total costs in absolute terms, down year on year for the firsttime since 1999.
Better capitalised:•• Increased Common Equity Tier 1 capital by 96 basis points to 10.6%.
•• Generated 229 basis points of organic capital, primarily drivenby earnings growth and reduction in the Group’s Risk Weighted
Assets (RWA).

ON AREAS WHEREWE CAN CARVEOUT A WINNING POSITION•• Established banking relationships with ~250,000 net new retailcustomers in Australia and New Zealand.
•• In Australia, we strengthened our number 3 home loan market shareposition, introduced First Home Buyer coaches, and for the first timehome loan accounts exceeded 1 million.
•• In New Zealand, we maintained our number 1 market share position
in home loans, held a leading position in overall brand consideration1(at 51%) and increased our Retail Net Promotor Score2.
•• Grew small business deposits by 9% in Australia and commercial
deposits by 6% in New Zealand.

Better balanced:•• Further rebalanced the portfolio, with capital allocated to Retail andCommercial in Australia and New Zealand increasing by 9% to 53%
since 2015.
•• Improved risk adjusted returns in Institutional, through a combinationof $18 billion reduction in credit RWA and improvement in earnings
composition of markets, transaction banking and lending.
•• Progressed the sale of non-core businesses and minority investments,
expected to deliver an estimated 80 basis points of capitalonce complete.

FY18 PRIORITIES•• Complete transactions in train and further progress the sale ofnon-core businesses and minority investments.
•• Continue repositioning the Institutional business, targeting further
RWA reductions and improved returns.
•• Deliver a step-change in our cost structure.
•• Run the bank prudently, balancing growth, return and risk.

FY18 PRIORITIES•• Maintain momentum in our home loan and small businessfranchises to deliver consistent, above-system growth in a
cautious and responsible way.
•• Build Home Owner and Small Business Ecosystems to engage
customers and improve the customer proposition and drive newrevenue streams.
•• Build our Institutional’s regional trade, cash management andmarkets platforms.
•• Build a platform that makes payments easier, cheaper and more
integrated for individuals and organisations.

1.
2.

18

Source: McCulley Research Brand Tracking (online survey, first choice or seriously considered); six month rolling average.
Retail Market Monitor, Camorra Research, Sep'16 & Sep'17 (monthly).

OUR STRATEGY“WITH ANZ, WE’VE
FOUND A MOREPERSONALISEDAPPROACH. THEY’RE
INTERESTED IN US
BOTH AS PEOPLE,
AND AS A GROWING
BUSINESS.”— Kathy Grant

Kathy Grant and Justin Davenport,
Lux Design Group — clothing designers,
wholesalers, importers and manufacturers.

DRIVE A PURPOSE
AND VALUES-LED
TRANSFORMATION
OF THE BANKBUILD A SUPERIOR EVERYDAY
EXPERIENCE FOR CUSTOMERSAND OUR PEOPLE TO
COMPETE IN THE DIGITAL AGE

FY17 PROGRESSFY17 PROGRESS•• Established CEO-led Responsible Business Committee and revised
Charter of Environment, Sustainability and Governance Board
Committee to advance ANZ’s purpose and increase focus on
ESG issues.

•• The only Australian major bank to offer payment options acrossApple PayTM, Apple Watch Pay, Android PayTM, Samsung Pay
and FitBitTM Pay — backed by the ability to make high-valuetransactions easier with the introduction of voice biometrics.

•• Contributed $131 million in community investment supported
by 113,127 community volunteering hours by employees.

•• Expanded accessibility features for ANZ Visa Debit cards including
features to assist customers with visual impairment andreading difficulties.

•• Engaged our people and continued to build positive advocacy
for ANZ and the industry through ‘The ANZ Way’, focusing on
ANZ’s purpose, strategy, refreshed values and Code of Conduct.
•• Introduced a new ‘balanced scorecard’ incentive plan in ourbranches and retail banking contact centres, increasing theweighting to good customer outcomes, and established a newrole of Customer Fairness Advisor.

•• Acquired online property site RealAs to bolster our digital offeringin Australia’s property market.
•• Added to small business product offerings through our
Employment Hero partnership while adding payments capability
with BladePayTM and FastPay® Next Generation.

•• Implemented key priorities of our revised Human Rights
Standards, including strengthened customer due diligenceand employee training.

FY18 PRIORITIESFY18 PRIORITIES•• Act boldly and aligned with our purpose to re-engage with thecommunity, regain trust and differentiate ANZ.

•• Simplify and standardise our technology landscape in support ofour ambitions.

•• Embed our values and 'New Ways of Leading' with all leadersacross the bank.

•• Introduce 'New Ways of Working', to more rapidly deliver valuable
new features and services to our customers, engage our people
and attract new talent.

•• Continue to change the way we communicate internally tocreate a more transparent, open culture.

•• Build the skills required to develop compelling customer propositions,unlock the value of data and optimise our core processes.
•• Better utilise data to strengthen relationships, grow revenue andimprove risk management.

19

ANZ 2017 ANNUAL REVIEWCASE STUDY

BUILDING A
CULTURE OF RESPECT
Simon Giddings, pictured, a Customer Service Consultant
in our Melbourne Contact Centre, is completely blind. He
performs his role with the assistance of screen reading
software and a braille display. As a customer is talking to
him in one ear, a synthetic voice simultaneously reads him
the content off his computer screen, enabling him to deal
successfully with a wide range of customer enquiries.

“Before I was employed by ANZ,
I was not at all confident that I would
be able to provide a secure future
for my family. Not only am I now
confident that I can do so, but I
would say ANZ and its staff haveshown me the utmost respect
and total support. That is why
I try hard to do the same for our
staff and our customers.”

OUR CORPORATESUSTAINABILITYFRAMEWORK
Our Corporate Sustainability Framework supports ourbusiness strategy, reflects our most material issues andis aligned with the bank’s purpose. The Framework has
three key areas of focus:•• Sustainable growth: create opportunities for all of ourcustomers and enable sustainable growth for individuals,
businesses and industry.
•• Social and economic participation: build strong
customer relationships and connect with our communities,
supporting a diverse and inclusive society in which
everyone can participate.
•• Fair and responsible banking: earn trust by keeping
pace with the changing expectations of our stakeholders,maintaining high standards of conduct and understanding
the social and environmental impacts of our lending decisions.
ANZ is committed to the United Nations’ Sustainable
Development Goals (SDGs) and our Framework, together withpublic targets that we set annually, supports the achievementof the SDGs.

20

This year we achieved or made good progress against 83%
of our targets. We fell short of achieving our targets in relation
to women in management, employee engagement, employee
volunteering and the roll-out of our ANZ goMoney mobile phonebanking app in the Pacific.
Financial wellbeing — creating opportunities
for social and economic participation
One of the most significant ways in which we contribute to
the communities in which we operate is through our long-term
investment in financial education programs, assisting people
on lower-incomes and with low levels of financial literacy tobuild their money management skills and savings.
Lifting levels of financial literacy and inclusion has been shown
to result in greater economic participation and social benefits
for individuals and the community. It has also brought a range ofsignificant benefits to our business. Customers with higher levelsof financial literacy and capability are generally more financially
included, tend to hold more financial products and make more
informed financial decisions. Our employees can also benefit
from increased financial capability, leading to greater individual
wellbeing and, importantly, a greater ability to respond to thediverse financial needs of our customers.

OUR STRATEGYCASE STUDY

JAMIE’S
STORYThis year, more than 4,000 people in Australia have benefited
from Saver Plus, our financial education and matched savings
program for lower-income earners.
Jamie, pictured, with her three children, completed theprogram in January. She heard about Saver Plus throughthe school newsletter and decided to join because it provided
the opportunity to receive up to $500 in matched savings
towards her children’s education costs.
“Before Saver Plus, I’d transfer money from one store card
to another and nothing would be reducing,” Jamie said. “Saver
Plus helped me get in control of my debts and taught me how
to actively save for future expenses. I now have a budget on
a spreadsheet, I know when my credit card cycle is and canbetter manage my money.”
Participants make regular deposits towards a savings goalover a 10-month period and attend workshops to build theirfinancial management skills.
To learn more visit anz.com/saverplus.

“Saver Plus is an amazing program that hasrelieved a lot of pressure”.
21

In 2016 we joined a group of 12 ‘trailblazer’ organisations as
the first to release a Financial Inclusion Action Plan (FIAP).
The program, managed by Good Shepherd Microfinance andsupported by the Australian Government, stems from Australia’scommitment to the G20 goal of alleviating poverty throughfinancial inclusion.
Modelling estimates that over the next 10 years, the FIAP
program will play a role in enabling large numbers of Australians
to progress away from financial crisis and hardship.1 This
collective action (there are now 30 organisations committed
to a FIAP) has the potential to contribute to a GDP uplift of$2.9 billion, government savings of $583 million and increased
household wealth of $11.8 billion per annum.

Our sustainability performance has been recognised on anumber of sustainability indices, including the Dow Jones
Sustainability Index, FTSE4Good and CDP (formerly the Carbon
Disclosure Project).
Further detail on ANZ’s approach to sustainability andperformance against 2017 targets, is contained in our 2017
ANZ Corporate Sustainability Review (independently assured
by KPMG), available at anz.com/cs in December 2017.

We are also committed to providing employment opportunities
for disadvantaged and under-represented groups to supportsocial inclusion and financial wellbeing. This year we employed
250 people from under-represented groups, including people witha disability, Aboriginal and Torres Strait Islanders and refugees.

1.

SPP (2016). Economic Modelling for FIAP Program Implementation Team, November 201621

ANZ 2017 ANNUAL REVIEWGOVERNANCE
ANZ’s strong governance framework provides a solid
structure for effective and responsible decision making
within the organisation. The Board has oversight of
the risks and opportunities arising from our activities
and is responsible for setting the direction, strategies
and financial objectives for the bank and for monitoring
the implementation by management of those strategies
and objectives.
There are five principal Board Committees — the Audit
Committee, the Environment, Sustainability and Governance(ESG) Committee, the Risk Committee, the Human Resources
Committee and the Digital Business and Technology Committee.
Each Committee has its own Charter setting out its roles
and responsibilities.

At management level, the Group Executive Committee(ExCo) comprises ANZ’s most senior executives. There isa delegations of authority framework that clearly outlines
those matters delegated to the CEO and other membersof senior management. In addition, there are a numberof formally established management committees thatdeal with particular sets of ongoing issues.
For further detail on ANZ’s governance frameworksee our 2017 Corporate Governance Statement available
on anz.com/corporategovernance.

BOARD OF DIRECTORS
From left to right: David Gonski, AC – Chairman, Independent Non-Executive Director, Graeme Liebelt – Independent Non-Executive Director,
John Macfarlane – Independent Non-Executive Director, Paula Dwyer – Independent Non-Executive Director, Ilana Atlas – Independent
Non-Executive Director, Shayne Elliott – Chief Executive Officer, Executive Director, Jane Halton – Independent Non-Executive Director,
Lee Hsien Yang – Independent Non-Executive Director
Full biography details can be found on our website at anz.com/directors.

22

GOVERNANCE AND RISK MANAGEMENTDIRECTORS' MEETINGS
The number of Board meetings and meetings of Committees during the year the Director was eligible to attend, and the numberof meetings attended by each Director were:
Environment,

Board

Risk
Committee

Audit
Committee

A

A

B

A

B

A

B

5

5

4

4

4

4

A

B

Ilana Atlas

12

11

Paula Dwyer

12

12

Shayne Elliott

1212David Gonski, AC

12

12Jane Halton, AO, PSM 11

11

Lee Hsien Yang

12

12

6

6

Graeme Liebelt

12

12

6

6

4

4

Ian Macfarlane

4

4

2

2

1

1

John Macfarlane

12

12

6

6

5

5

2

Sustainability
DigitalandBusiness andGovernance Technology
SpecialCommittee
SharesCommittee Committee Committee of the Board1 Committee1

Human
Resources
Committee

B

6

6

5

5

4

4

6

6

5

5

4

4

4

4

3

3

3

3

4

4

1

1

4

4

1

1

A

B

A

B

A

B

2

2

A

B

3

3

1

1

3

3

5

5

1

1

3

3

1

1

3

3

2

2

3

3

Columns marked A indicate the number of meetings the Director was eligible to attend.
Columns marked B indicate the number of meetings attended. The Chairman is an ex-officio member of the Audit, Environment, Sustainability and Governance, Human Resources,
Risk and Digital Business and Technology Committees.
Any Director is entitled to attend any Committee meetings. Directors sometimes attend meetings of Committees of which they are not a member.
1.

The meetings of the Committee of the Board and Shares Committee as referred to in the table above include those conducted by written resolution.

2.

Ian Macfarlane retired as a Director on 16 December 2016.

EXECUTIVE COMMITTEE
From left to right: Shayne Elliott – Chief Executive Officer, Maile Carnegie – Group Executive Digital Banking, Graham Hodges – Deputy
Chief Executive Officer, Farhan Faruqui – Group Executive International, Alexis George – Group Executive Wealth, Nigel Williams – Chief Risk
Officer, Michelle Jablko – Chief Financial Officer, Fred Ohlsson – Group Executive Australia, Mark Whelan – Group Executive Institutional,
Kathryn van der Merwe – Group Executive Talent and Culture, Gerard Florian – Group Executive Technology, David Hisco – CEO
New Zealand and Group Executive Asia Wealth, Pacific and International Retail.
Full biography details can be found on our website at anz.com/exco.

23

ANZ 2017 ANNUAL REVIEWOUR APPROACH TO ENVIRONMENTAL,
SOCIAL AND GOVERNANCE (ESG)
RISK MANAGEMENTThe ESG Committee (formerly, the Governance Committee),
led by ANZ’s Chairman, has a specific focus on sustainability,
approving the bank’s sustainability targets and reviewing
progress in achieving them. It also advises management
on ESG issues and reviews minutes from management
committees regarding sustainability issues.
The Board is responsible for establishing and overseeing
the bank’s risk management framework, with the Board
Risk Committee responsible for developing and monitoring
compliance with ANZ’s risk management policies. Management
reports concerning the implications of new and emerging risks
are reviewed by the Risk Committee. This may include risks
that arise from the social and environmental impacts of ourlending decisions.

“THE RESPONSIBLE BUSINESSCOMMITTEE IS CHARGED
WITH MAKING SURE THATWE EMBED OUR PURPOSE
IN EVERYTHING WE DO —THAT WE ARE THOUGHTFULIN THE WAY WE ENGAGE
ACROSS THE BANK AND WITH
THE COMMUNITY, SO THATPEOPLE WILL NOTICE AND
SAY ‘ANZ IS REALLY MAKING
A DIFFERENCE’.”This year we established the Responsible Business Committee(RBC), chaired by the CEO and comprised of senior executives
from business divisions and Group functions, including Risk,
Corporate Affairs and Human Resources. The Committee replaces
the Reputational Risk, and Corporate Sustainability and Diversity
Committees, and is a leadership and decision making body thatexists to advance ANZ’s purpose. Among other responsibilities,
the RBC agrees and sets ANZ’s risk appetite for industry sectors
to align with the bank’s purpose and values. It also oversees
and monitors current and emerging ESG risks and opportunities,
debating and agreeing relevant material matters including
breach of Sensitive Sector Policies and exemptions requestedby the business.
One of the key ways we identify and manage the risks associatedwith our business lending is through the application of ourSensitive Sector Policies — consolidated this year into a new
Social and Environmental Risk Policy. This new policy consolidates
the principles and standards previously embedded within our six
Sensitive Sector Policies into one ‘umbrella’ policy.
This holistic policy incorporates social and environmental
considerations into lending decisions for all customer sectors.
Relationship managers are required to respond to a broad rangeof social and environmental questions before the bank enters
into a relationship with any customer. Our credit policy requires
customer relationships to be reviewed regularly, which includes
considering any social and environmental issues.
The Social and Environmental Risk Policy incorporates relevant
content of ANZ’s revised human rights standards including
ANZ’s ‘zero tolerance’ for improper land acquisition andinvoluntary resettlement.

— Shayne Elliott, CEORESPECTING HUMAN RIGHTS
Failing to respect human rights and adequately manage
human rights-related risks can have negative consequences
for our business, eroding trust and damaging relationships
with key stakeholders.
Last year we upgraded our human rights standards,
Respecting People and Communities: ANZ’s approachto Human Rights, consulting with customers, NGOs,
Government, industry bodies, academics and subject
matter experts within ANZ.

We established a three-year program of work to guide
implementation of our revised standards and have met
our implementation priorities for 2017 by:•• updating the social and environmental screening tool
used by our bankers to include our ‘zero tolerance forland grabs’ commitment;•• piloting a strengthened customer due diligenceprocess in a selected country in Asia; and•• reviewing and updating employee training programs
to reflect our revised standards.
Our standards are embedded in our everyday business activities,
including through our human resources policies and in customer
and supplier screening tools.

24

GOVERNANCE AND RISK MANAGEMENT

MATERIAL ISSUESAND RISK MANAGEMENT
One of the ways in which we identify our material social and environmental risks is through our annual materiality assessment(see page 12). Our most material issues are captured and managed within our existing Material Risk categories (as the table below
shows). There is also a clear link between our Material Risks and the challenges arising from the external environment in which
we operate.
A full list of ANZ’s Material Risks is available on page 34 of the Annual Report.
Material
Risk Type
Compliance
Risk

Description
The probability and impact of an event that
results in a breach of any of the followingthat apply to the Group’s businesses: laws,
regulations, industry standards, codes,
internal policies, internal procedures, or
principles of good governance.

Managementof Material Risks

Most MaterialIssuesKey features of our Compliance Risk framework
include centralised management of key
obligations, and emphasis on identifying changes
in regulations and the business environment,so as to enable us to:•• proactively assess emerging compliancerisks; and•• implement robust reporting and certification
processes.

CreditRisk

The risk of financial loss resulting from:•• a counterparty failing to fulfil its
obligations; or•• a decrease in credit quality of acounterparty resulting in a financial loss.
Credit Risk incorporates the risks associatedwith us lending to customers who could be
impacted by climate change or by changes
to laws, regulations, or other policies adopted
by governments or regulatory authorities,
including carbon pricing and climate change
adaptation or mitigation policies.

Operational
Risk

The risk of loss resulting from inadequate or
failed internal processes, people and systems,
or from external events. Operational Risk:•• includes technology risk, cyber risk, legalrisk and conduct risk, and damage arisingfrom inadequate or failed internal
processes, people and systems; but•• excludes Strategic Risk.

Reputation
Risk

Our Credit Risk framework is top down,being defined by credit principles and policies.
Credit policies, requirements and procedures
cover all aspects of the credit life cycle —for example: transaction structuring, risk
grading, initial approval, ongoing management
and problem debt management, as well as
specialist policy topics.

The Group operates a three-lines-of-defence
model to manage Operational Risk, witheach line of defence having defined roles,
responsibilities and escalation paths tosupport effective two-way communicationand effective management of our operationalrisk. Also, we have ongoing review mechanisms
to ensure our Operational Risk framework
continues to meet organisational needs andregulatory requirements.

The risk of loss that directly or indirectly
impacts earnings, capital adequacy orvalue, that is caused by:

We manage Reputation Risk by maintaining
a positive and dynamic culture that:•• adverse perceptions of the Group heldby any of customers, the community,
shareholders, investors, regulators, or
rating agencies;•• enables us to build strong and trusted
relationships with customers and clients,
with colleagues, and with the broader society.

•• conduct risk associated with the Group’s
employees or contractors (or both); or•• the social or environmental (or both)
impacts of our lending decisions.

•• ensures we act with integrity; andWe have well established decision-making
frameworks and policies to ensure our businessdecisions are guided by sound social andenvironmental standards that take into account
Reputation Risk.

25

ANZ 2017 ANNUAL REVIEW“COMPANIES MUST IMPROVE REPORTING ON THEIRMANAGEMENT OF CARBON RISKS AND OPPORTUNITIES FOR
THEIR SHAREHOLDERS AND BANKS TO MAKE MORE INFORMEDDECISIONS. WE ARE DOING OUR PART BY BEING AN EARLYADOPTER OF THE FSB TASKFORCE RECOMMENDATIONS AND
THUS SIGNALLING WE WILL BE SEEKING GREATER DISCLOSURE
FROM OUR CUSTOMERS ABOUT THEIR CLIMATE-RELATED RISKSAND OPPORTUNITIES.”— Shayne Elliott, CEO

IMPROVING OUR CLIMATE-RELATEDFINANCIAL DISCLOSURESWe are improving disclosure of our carbon strategy, management, metrics and targets. Our reporting reflects the Financial
Stability Board’s (FSB) Task Force on Climate-Related Disclosures (TCFD) recommendations.
Using the FSB TCFD’s disclosure framework, we have begun discussions with some of our customers in emissions-intensive industries.
Their public disclosures under the framework will enable us to better understand how they are managing their climate-related risks
and opportunities.

1. GOVERNANCE

3. RISK MANAGEMENT

Within ANZ, our Board has the highest level of oversightand responsibility for climate change. The ESG Committee is
responsible for reviewing and approving our climate changerelated objectives, including goals and targets. The Board Risk
Committee has formal responsibility for the overview of ANZ’smanagement of new and emerging risks, including climatechange-related risks.

Our Climate Change Statement sets out the actions we are taking
to support the transition to a low carbon economy. Our mostmaterial climate change risks and opportunities result from ourlending to business and retail customers. We want to support
businesses that are resilient and have the capacity to successfully
manage the transition to a low carbon future. Information on
how we engage with our customers is discussed in our 2017
ANZ Corporate Sustainability Review.

The RBC provides strategic leadership on ANZ’s corporate
sustainability risks and opportunities, monitoring progress against
our targets, including those related to climate change. Minutesof the RBC are reviewed by the Board ESG Committee.
The RBC is also responsible for understanding and assessing
the impacts of specific industries as they relate to current
and emerging risks, including climate change. Where appropriate,
these issues are also referred to the ESG Committee for discussion.

2. STRATEGY
Identification and management of our material sustainability
risks and opportunities, including those presented by climatechange, supports ANZ’s business strategy and aligns with theapproach outlined in our Climate Change Statement. We achieve
this through: setting targets; establishing low carbon financial
products and services; policies to guide our decision making;staff training; and managing direct operational impacts.
Our strategy needs to be resilient under a range of climaterelated scenarios. This year we have undertaken climate-related
scenario testing of a select group of customers in the thermal
coal supply chain. This included customers with operations inthermal coal extraction, coal rail transport, coal-associatedports and coal-fired power generation.
We assessed these customers using two of the International
Energy Agency’s scenarios; the ‘New Policies Scenario’ and the‘450 Scenario’. This provided us with a better understanding of
the preparedness and resilience of these customers to climatechange. We will engage with them over the next 12 months togain further insights into their risk and opportunity assessments.
26

There are some climate change risks and opportunities thathave the potential to generate substantive change in ourbusiness operations, revenue or expenditure. These include:
Energy policy/regulation: the introduction of energy policy
and regulations, supporting lower emissions and improved
reliability, provide a more stable environment for investment,
and subsequently revenue opportunities, with existing customers
and in new markets.
Changes in precipitation extremes and droughts: ANZ has
a large presence throughout rural and regional Australia and
New Zealand. Many of these regions have been impacted inrecent years by severe climatic events such as drought and hightemperatures, adversely affecting our customers’ productionlevels. Reduced revenue for these customers may impact theirability to repay credit extended to them.
Changing consumer behaviours: businesses’ response to climatechange, including the adoption of new technologies, presents
a number of opportunities, including the provision of funding
and advisory services to customers involved in renewable energy
generation, construction and retrofit of green buildings and lessemissions intensive manufacturing and transport. We are wellplaced to maximise these opportunities and have funded andfacilitated $6.9 billion in low carbon and sustainable solutions
since 2015. This includes projects using renewable or more efficientmaterials, renewable or more efficient energy generation or
technologies that reduce greenhouse gas emissions and waste.

GOVERNANCE AND RISK MANAGEMENTCASE STUDYFINANCING THE TRANSITION
TO A LOW CARBON ECONOMY
We worked with Investa Office Fund (Investa) this year to issue a seven-year, AUD$150 million dollar green bond — the first corporate
green bond ever issued in Australia ­— the proceeds of which were used to refinance a portfolio of low-carbon buildings.
By combining Investa’s desire for financial innovation with ANZ’s market knowledge and execution capability, we were able
to deliver a successful green bond issuance. The bond was over-subscribed and attracted a strong proportion of 'dark green'
investors and also gave the company a chance to further promote its ESG credentials to the market. Investa is one of Australia’s
largest owners and managers of Institutional-grade office real estate, controlling assets worth more than $11 billion.

From left to right: Anna Galbraith – Associate Director, Capital Markets, ANZ, Peter Menegazzo – Chief Investment Officer, Investa, Nina James –GM Corporate Sustainability, Investa, Paul White – Co-Head of Capital Markets, ANZ, Katharine Tapley – Head of Sustainable Finance, ANZ

4. METRICS AND TARGETS
We use a range of metrics to assess the impact of climaterelated risks on our business activities. In recent years, we haveincreased transparency regarding our business lending exposure
to key industry sectors in Australia and New Zealand, enabling
stakeholders to better understand our customers’ contribution
to the national emissions profiles of our home markets. We also track
the average emissions intensity of the electricity generation assets
we provide project finance for, together with the breakdown
of funding provided to coal, gas and renewable assets.
We have established Group-wide emissions reduction targets
that cover the emissions arising from the energy we use acrossour building portfolio of commercial offices, branches and data
centres. In 2017 we have reduced the emissions from premises
energy use by 20% compared to 2013, exceeding our targetof a 1-3% reduction by 30 June this year.
Further detail on these disclosures, including the scenario
testing, are discussed in our 2017 ANZ Corporate Sustainability
Review, available on anz.com/cs in December.

“ANZ DELIVERED A SOLUTIONTHAT TOOK US ABOVE
AND BEYOND THE BASIC
NECESSITY OF OBTAINING
LONG-TERM, COMPETITIVELYPRICED FINANCING AND
ALIGNED WITH OUR TRACK
RECORD OF BEING AN ESGLEADER IN THE AUSTRALIAN
BUSINESS COMMUNITY.”— Peter Menegazzo,
Chief Investment Officer, Investa.

27

ANZ 2017 ANNUAL REVIEWREMUNERATIONOVERVIEW
The following pages provide a summary of the remuneration for the Non-Executive Directors (NEDs), Chief Executive Officer (CEO)and Disclosed Executives ­— Key Management Personnel (KMP). The detailed Remuneration Report is contained in the Annual Reportfrom page 36 onwards. The report can be accessed via the ANZ website at anz.com/annualreport.
Non-Executive Director (NED) Remuneration
There was no increase to NED fees for the 2017 year. Year-on-year differences in total remuneration relate to changes in
Committee memberships.

FinancialYear

Short-Term NED
Benefits
Post-Employment
Fees1 Super contributions1

Total remuneration2

$

$

$

2017

805,276

19,724

825,000

2016

805,615

19,385825,0002017

317,776

19,724

337,500

2016

297,115

19,385316,500

2017

345,276

19,724

365,000

2016

345,615

19,385365,000

J Halton3

2017

241,063

18,894259,957

H Lee

2017

315,276

19,724

335,000

2016

315,615

19,385335,000

2017

343,151

19,724362,875

2016

338,615

19,385358,0002017

298,776

19,724

318,500

2016

299,115

19,385318,500

2017

68,225

4,904

73,1292016

330,115

19,385349,500

2017

2,734,819

142,1422,876,961

2016

2,731,805

135,695

2,867,500

Current Non-Executive Directors
D GonskiI AtlasP Dwyer

G Liebelt

J Macfarlane

Former Non-Executive Director
I Macfarlane4

Total of all Non-Executive Directors

1.
2.

3.
4.

28

Year-on-year differences in fees relate to changes in Committee memberships and changes to the superannuation maximum contribution base.
Long-term benefits and share-based payments do not apply for the Non-Executive Directors. There were no non monetary benefits or termination benefits for the Non-Executive
Directors in either 2016 or 2017.
J Halton commenced as a Non-Executive Director on 21 October 2016, so 2017 remuneration reflects a partial service year.
I Macfarlane retired as a NED on 16 December 2016. Statutory remuneration table reflects his expense up to his date of retirement.

REMUNERATION OVERVIEWREMUNERATION AT A GLANCEANZ’S PURPOSE AND STRATEGY 1
UNDERPINNED BY:
OUR REMUNERATIONPOLICY/PRINCIPLES:

Attract, motivate
and retain talent

Focus on both short andlonger term performance/
value creation

Reward for performanceand behaviours alignedwith ANZ’s Values

Support the best interestsof our customers andsound risk management

DELIVERED TO OUR CEO AND DISCLOSED EXECUTIVES THROUGH:

Fixed remuneration

Variable remuneration delivered as

OUR CORE REMUNERATIONCOMPONENTS2:

Cash

Deferred shares

Performance rights

At risk
REINFORCED BY:

ALIGNINGREMUNERATION
AND RISK:

Assessing behaviours
based on ANZ’s Values
and risk/compliancestandards

Risk is a key input in
determining variable
remuneration

Applying Board
discretion on
performance andremuneration
outcomes

Being able todownward
adjust deferredremuneration(including to zero)

Prohibiting
the hedging ofunvested equity

WHILE SUPPORTING THE ALIGNMENT OF EXECUTIVES AND SHAREHOLDERS THROUGH:SHAREHOLDERALIGNMENT:

Substantial shareholding
requirements

Use of relative and absolute
Total Shareholder Return(TSR) hurdles

Significant incentive deferral(up to four years)
in ANZ equity

Use of Economic Profit asa key input in determining
the incentive pool

DRIVING PERFORMANCE THROUGH OBJECTIVES WITHIN THE GROUP PERFORMANCE FRAMEWORK TO DETERMINE THE INCENTIVE POOL:GROUPPERFORMANCECATEGORIES:ANZ’S 2017
PERFORMANCEOVERALL:(refer to section 5.1of theRemuneration Report)

Risk

Financial and Discipline(50% weighting)(overall adjustment)

Customer(30% weighting)People and Reputation(20% weighting)(combined weighting 100%)

The 2017 result is a good outcome which demonstrates further progress in becoming
a better balanced, better capitalised, more efficient bank.
ANZ’s overall performance assessment was slightly below target and this is reflectedin the variable remuneration outcomes.

No change to the CEO’s and Disclosed Executives’ fixed remuneration for 2017.
2017 FIXEDREMUNERATIONCHANGES:

Fixed remuneration for new appointments has been set lower than prior incumbent.
Fixed remuneration has remained unchanged since 2014 for a number of Disclosed Executives.
No change to NED fees for 2017.

INDIVIDUAL PERFORMANCE OUTCOMES REFLECT THE PERFORMANCE OF THE GROUP, DIVISION AND INDIVIDUAL:
2017 VARIABLE
REMUNERATIONOUTCOMES3:(refer to sections 5.2
and 5.3 of theRemuneration Report)

1.
2.
3.

4.

CEO
Annual Variable Remuneration:
95% of target (63% of max)Long Term Variable Remuneration:$2.1m/$4.2m (face value)4 at
threshold/full vesting subject
to shareholder approval

Disclosed Executives
Variable Remuneration outcomes:% of target % of max
Average:
Range:

96%

64%

76% - 136% 51% - 91%

Nov 2013
performance rights
fully lapsed.
Executives received
no value from this award.

Refer to the 'About our Business' and 'Our Strategy' sections of the Annual Report.
The structure of our remuneration framework is aligned with our remuneration principles and has been designed to support ANZ’s purpose and strategy.
Variable remuneration outcomes appropriately reflect the Group’s performance against the indicators in the Group performance framework, and also the individual’s performance against theirown targets, which are appropriately stretching.
Face value at threshold/full vesting (50%/100% vesting).

29

ANZ 2017 ANNUAL REVIEWCEO AND DISCLOSED EXECUTIVES' REMUNERATION
2017 Variable Remuneration awardedThis table shows the VR awarded to the CEO and Disclosed Executives for the year ending 30 September 2017 and what this represents as a % of theirtarget opportunity and maximum opportunity.
The average variable remuneration awarded to the CEO and Disclosed Executives is 96% of target (64% of maximum) which is well aligned with theGroup performance assessment outcome.
Only the cash component will be received now, the deferred shares will vest over four years and the performance rights may or may not vest whentested against the hurdles after three years.

==$1,000,000++$561,000$561,000= $301,290 +++$726,181+=$732,600+$732,600=$739,200+$739,200$534,600

=
=

+

+

$1,080,750$627,000Deferred shares or deferred share rights++$726,181$534,600$627,000$578,000$310,420

=

=

Cash

$301,290$1,000,000$748,187+$754,800++$761,600$550,800$1,080,750++$1,113,500$646,000

Performance rights face value at threshold vesting3

 emuneration disclosed from commencement in Disclosed Executive role.
R
As CRO, receives deferred share rights instead of performance rights.
Multiply by two to convert to face value at full vesting.

1.
2.
3.

2017 Actual Remuneration received
This table shows the remuneration actually received by the CEO and current Disclosed Executives in relation to the 2017 performance year as cash,
or in the case of prior equity awards, the value which vested in 2017. The final column also shows the value of prior equity awards which lapsed
in 2017 (these awards reflect the 2013 performance rights which failed to meet the performance hurdles when tested in November 2016).
Only the cash component of the 2017 VR award appears in this table, as the other components are deferred and may/may not vest in future years.

Fixed
remuneration$

Cashvariable
remuneration$

Deferred variable Other deferredremuneration
remuneration
which vested
Total
which vested
cash during the year1 during the year1$$$

Deferred variable
remuneration
Actualwhich lapsed/
remuneration forfeited during
received
the year1$$

CEO and Current Disclosed Executives
S Elliott

2,100,000

1,000,000

3,100,000

1,161,588-

4,261,588(1,929,199)

M Carnegie

1,000,000
664,000

561,000
301,290

1,561,000
965,290-

2,783,169
250,000

4,344,169
1,215,290-

1,195,013

726,181

1,921,194

1,102,772-

3,023,966(1,348,887)

G Hodges

1,050,000

732,600

1,782,600

677,607-2,460,207(964,586)

M Jablko

1,000,000

739,200

1,739,200-

1,004,553

2,743,753-

F Ohlsson

1,000,000

534,600

1,534,600

694,592-

2,229,192(254,839)

M Whelan

1,200,000

1,080,750

2,280,750

1,154,038-

3,434,788(385,812)

N Williams

1,350,000

627,000

1,977,000

1,621,508-

3,598,508-

A George2
D Hisco3

1.

2.
3.

The point in time value of previously deferred remuneration granted as shares/share rights and/or performance rights is based on the one day VWAP of the Company’s shares traded on the ASX on thedate of vesting or lapsing/forfeiture multiplied by the number of shares/share rights and/or performance rights. The amount paid as deferred cash is the value included.
Remuneration disclosed from commencement in Disclosed Executive role (1 December 2016).
Paid in NZD and converted to AUD.

This table supplements, and is different to, the Statutory Remuneration table in the Remuneration Report which presents the accounting expense forboth vested and unvested awards in accordance with the Australian Accounting Standards.
30

REMUNERATION OVERVIEWANZ Centre foyer

31

ANZ 2017 ANNUAL REVIEW

5-YEARSUMMARY
Financial performance1

2017

2016

2015

2014

2013

Net interest income ($m)

14,872

15,095

14,616

13,797

12,772Other operating income ($m)

5,617

5,482

5,921

5,781

5,619

Operating expenses ($m)(9,448)(10,422)(9,378)(8,760)(8,257)

Profit before provisions and income tax ($m)

11,041

10,155

11,15910,818

10,134Credit impairment charge ($m)

(1,199)(1,956)(1,205)(989)(1,197)

Income tax expense and non-controlling interest ($m)(2,904)(2,310)(2,738)(2,712)(2,445)

Cash/Underlying profit ($m)

6,938

5,889

7,216

7,117

6,492

Adjustments to arrive at statutory profit ($m)

(532)

(180)

277

154

(182)

Profit attributable to shareholders of the Company ($m)

6,406

5,709

7,493

7,271

6,310

Assets ($m)

897,326

914,869

889,900

772,092

702,995

Net Assets ($m)

59,07557,92757,35349,28445,603

10.6

9.6

9.6

8.8

8.5

Common Equity Tier 1 – Internationally Harmonised Basel lll (%)

15.8

14.5

13.2

12.5

12.7

Return on average ordinary equity

11.0

10.0

14.5

15.8

15.0

Return on average assets (%)

0.7

0.6

0.9

1.0

0.9

Cost to income ratio (%)

46.1

50.6

45.7

44.7

44.9

13.1

9.2

(7.5)

5.9

31.5

86,94880,88678,606

85,23584,450

Dividend (cps)

160

160

181

178

164

Share price — 30 September closing price ($)

29.60

27.63

27.08

30.92

30.78

522,425545,256

546,558

498,309468,343

1

1

Financial position

1

Common Equity Tier 1 (%)
2

3, 4

(%)

4

1

Shareholder value — ordinary shares
Total return to shareholders (%)
Market capitalisation ($m)

Other information
Number of shareholders5
1.

2.

3.
4.
5.

32

Since 1 October 2012, the Group has used cash profit as a measure of the result of the ongoing business activities of the Group enabling shareholders to assess Group anddivisional performance against prior periods and against peer institutions. For 2013-2017 statutory profit has been adjusted for non-core items to arrive at cash profit. Cash profit is not
audited; however, the external auditor has informed the Audit Committee that the adjustments have been determined on a consistent basis across each period presented.
Internationally Comparable methodology applied for 2015 to 2017 aligns with APRA’s information paper entitled International Capital Comparison Study, (13 July 2015). Basel Internationally
Comparable ratios do not include an estimate of the Basel l capital floor requirement.
Average ordinary equity excludes non-controlling interests and preference shares.
Return on average ordinary equity and average assets have been calculated on a statutory basis, consistent with the last five years.
Excludes employees whose only ANZ shares are held in trust under ANZ employee share schemes.

5-YEAR SUMMARY

Sustainability performance

2017

2016

2015

2014

2013

4

2

4

4

3

Australia Corporate & Commercial

4

4

4

3

3

Australia Institutional3

2

1

-

-

-

4

4

5

5

5

New Zealand Corporate & Commercial

4

4

4

4

4

New Zealand Institutional6

3

1

-

-

-

61

60

58

55

-

65

62

59

-

-

CUSTOMERSNet Promoter Score Ranking (relative to peers)
Australia Retail1
2

New Zealand Retail

4
5

Digitally active customers
Australia (%)7
New Zealand (%)

8

PEOPLE
44,89646,55450,15250,32849,866

Employee Engagement (%)10

72

74

76

73

72

Total Women in Management (%)

41.5

41.5

40.4

39.2

38.7

Investment in learning & development ($M)11

45.9

50.8

58.7

46.3

46

131.1

89.8

74.8

75.6

65.1

FTE9

COMMUNITY
Total community investment ($million)12
Volunteer hours

113,127

113,071

108,142

101,801

89,289

MoneyMinded — estimated number of people reached>76,000>60,900>67,000>54,000>40,000

4,074

4,649

2,826

5,461

>5,000126,881

136,751

147,499

154,922

163,206

6,992

7,910

9,189

10,008

11,955

Saver Plus — number of people reached
ENVIRONMENT
Scope 1 & 2 emissions
Australia (tCO2-e)
New Zealand (tCO2-e)
APEA (tCO2-e)47,12048,90852,84347,34744,984

Total (tCO2-e)

180,993

193,569

209,531212,277

220,145

Total scope 1,2 & 3 GHG emissions (tCO2-e)273,216

299,224

335,085

322,820

329,146

Renewables (%)

70

63

60

44

39

Coal (%)

16

19

18

33

34

Project finance portfolio13

Gas (%)
Project finance commitment to renewable energy ($M)
1.

2.

3.
4.
5.
6.

7.

8.
9.
10.

11.
12.
13.

13

18

22

23

27

1,141

875

881

835

-

Roy Morgan Research Single Source, Australian population aged 14+, Main Financial Institution, six month rolling average to Sep’13, Sep’14, Sep’15, Sep’16 & Sep’17. Ranking based on the four
major Australian banks. Definition: On a 10pt advocacy scale (where 1 is Very Unlikely and 10 Very Likely), bank’s Main Financial Institution (MFI) customers rate their likelihood to recommend
their MFI to a friend or colleague. Net Promoter Score = % Promoters (score 9-10) - % Detractors (score 1-6). Net Promoter® and NPS® are registered trademarks and Net Promoter Score and
Net Promoter System are trademarks of Bain & Company, Satmetrix Systems and Fred Reichheld.
DBM Business Financial Services Monitor. Base: Corporate & Commercial Banking (<$500m annual turnover) customers. Data based on 6 month average to Sep’13, Sep’14, Sep’15, Sep’16 &Sep’17. Ranking based on the four major Australian banks. Definition: On an 11pt advocacy scale (where 0 is Extremely Unlikely and 10 Extremely Likely), bank’s Main Financial Institution (MFI)
customers rate their likelihood to recommend their MFI to others for business banking. Net Promoter Score = % Promoters (score 9-10) - % Detractors (score 0-6). Net Promoter Score® is atrademark of Bain & Co Inc., Satmetrix Systems, Inc., and Mr Frederick Reichheld.
Peter Lee Associates Large Corporate and Institutional Relationship Banking surveys, Australia 2016-17, ranked against the Top 4 competitors.
Retail Market Monitor, Camorra Research, Sep’13, Sep’14, Sep’15, Sep’16 & Sep’17 (monthly).
Business Finance Monitor, TNS Kantar Research, Q3’13, Q3’14, Q3’15, Q3’16 & Q3’17 (quarterly).
Peter Lee Associates Large Corporate and Institutional Relationship Banking surveys, New Zealand 2016-17, ranked against the Top 4 competitors (in 2016 rank based on question ‘whichbank would you be most likely to recommend’).
Roy Morgan Research Single Source, proportion of ANZ customers aged 14+ conducted Internet banking using ANZ App or Website in last 4 weeks, 12 months rolling average to Sep13,
Sep'14, Sep'15, Sep'16 & Sep'17.
Proportion of ANZ customers who have used ANZ Internet Banking or ANZ goMoney at least once in the last 90 days. 12 months to Sep ‘15, Sep’16 and Sep’17. 2016 value has been restated.
Full-time equivalent employees, as disclosed in the 2017 Annual Report.
The 2017 engagement survey was run as a pulse survey sent to 10% of the bank’s employees with a 57% response rate. Previously, we have measured employee engagement by sending asurvey to all employees.
From 2015 this includes learning and development cost base (ie. salary and on-costs of employees within learning and development cost centre).
Includes foregone revenue, being the cost of providing low or fee free accounts to a range of customers such as government benefit recipients, not for profit organisations and students.
Breakdown for 2017 does not total to 100% due to rounding.

33

ANZ 2017 ANNUAL REVIEWIMPORTANT DATESFOR SHAREHOLDERS1
May 2018
1st MayInterim Results Announcement

14th MayInterim Dividend Ex-Date

15th MayInterim Dividend Record Date

16th May

DRP/BOP/Foreign Currency Record Date

July 2018
2nd JulyInterim Dividend Payment Date

October 2018
31st October

Annual Results Announcement

November 2018
12th November

Final Dividend Ex-Date

13th November

Final Dividend Record Date

14th November

DRP/BOP/Foreign Currency Record Date

December 201818th December

Final Dividend Payment Date

19th December

Annual General Meeting (Perth)1.

If there are any changes to these dates, the Australian Securities Exchange will be notified accordingly.

ANZ employees — Back row from left: Samantha Roberson, Melinda McCormack, Matthew Hastings, David Irvine, Natasha Capogreco. Front row from left: Lesley Clark, Andrea White,
An Nguyen, Danielle Gaggino.

CASE STUDYANZ
IN THE COMMUNITY
Employees from our Australia Division volunteered more than 400 hours to different community causes and raised more than
$23,000 this year. During the national Daffodil Day fundraising campaign,the team took cashless purchases and donations via
BladePay™ devices and our Shout app, raising more than $6,000 for the Cancer Council.
Every ANZ employee receives a paid day of volunteer leave annually to contribute time to a charity of their choice. This is oneof the ways in which our employees are bringing our purpose ­— to shape a world in which people and communities thrive — to life.

34

CONTACTS

REGISTERED OFFICE:ANZ Centre Melbourne
Level 9, 833 Collins Street
Docklands VIC 3008 Australia
Telephone: +61 3 9273 5555
Facsimile: +61 3 8542 5252
Company Secretary: Simon Pordage
INVESTOR RELATIONS:
Level 10, 833 Collins Street
Docklands VIC 3008 Australia
Telephone: +61 3 8654 7682
Facsimile: +61 3 8654 8886
Email: investor.relations@anz.com
shareholder.anz.com
Group General Manager
Investor Relations: Jill Campbell
CORPORATE AFFAIRS:
Level 10, 833 Collins Street
Docklands VIC 3008 Australia

SHARE REGISTRAR:
AUSTRALIA
Computershare Investor Services Pty Ltd
GPO Box 2975
Melbourne VIC 3001
Telephone within Australia: 1800 11 33 99
International Callers: +61 3 9415 4010
Facsimile: +61 3 9473 2500
Email: anzshareregistry@computershare.com.au
Austraclear Services Limited
20 Bridge Street
Sydney NSW 2000
Telephone: +61 8298 8476
LUXEMBOURG
Deutsche Bank Luxembourg S.A.
2, Boulevard Konrad Adenauer
L-1115 Luxembourg
Luxembourg
Telephone: +352 4 21 22 1

Telephone: +61 3 8654 3276
Email: gerard.brown@anz.com

NEW ZEALAND
Computershare Investor Services Limited
Private Bag 92119
Auckland 1142

Group General Manager
Corporate Affairs: Gerard Brown

Telephone: 0800 174 007
Facsimile: +64 9 488 8787

MORE INFORMATION
General Information on ANZ can be obtained from our website: anz.com. Shareholders can visit our
Shareholder Centre at shareholder.anz.com. ANZ Corporate Governance: For information about ANZ’s approachto Corporate Governance and to obtain copies of ANZ’s Constitution, Board/Board Committee Charters,
Codes of Conduct and Ethics and summaries of other ANZ policies of interest to shareholders and stakeholders,
visit anz.com/governance. Australia and New Zealand Banking Group Limited ABN 11 005 357 522.
This Annual Review (Review) has been prepared for Australia and New Zealand Banking Group Limited (“theCompany”) together with its subsidiaries which are variously described as: “ANZ”, “Group”, “ANZ Group”, “theBank”, “us”, “we” or “our”.

FTSE4Good

UNITED KINGDOM
Computershare Investor Services PLC
The Pavilions Bridgwater Road
Bristol BS99 6ZZ
Telephone: +44 870 702 0000
Facsimile: +44 870 703 6101
UNITED STATESCitibank Shareholder Services
P.O. Box 43077 Providence
Rhode Island 02940-3077
Callers outside USA: +1-781-575-4555
Callers within USA (toll free):+1-877-248-4237 (+1-877-CITI-ADR)
Email: citibank@shareholders-online.com
citi.com/adr
The Bank of New York Mellon
101 Barclay Street, Floor 7E
New York, NY 10286
Telephone: +1 212 815 5811
Deutsche Bank Trust Company Americas
60 Wall Street, Mailstop NYC 60-1630
New York, NY 10005
Telephone: +1 212 250 2500

shareholder.anz.com
Australia and New Zealand Banking Group
Limited (ANZ) ABN 11 005 357 522.
ANZ’s colour blue is a trade mark of ANZ.