A greater nation: NAB Chairman Ken Henry AC’s keynote speech

This is an edited version of Dr Henry’s keynote speech, ‘A greater nation: The role of business in the future of Australian infrastructure’, delivered at the Australian Infrastructure Dialogue in Sydney.

**Check against delivery**


Thank you, Gordon, for the introduction.  It’s good to be here.

There are three things that I want to talk about today: first, trust, and why it’s lacking; second, how it can be rebuilt and, in particular, the contribution of customer stewardship in infrastructure to that rebuilding; and third, why this is so important for the nation’s future prosperity.  I will also make some reflections upon the importance of rebuilding trust for business.


Across the globe, in both regional and city areas, community trust in government, business, the media and even NGOs is dwindling.  According to the Edelman Trust Barometer, none of these enjoys the trust of even 50 per cent of the Australian population; government and the media very much less than 50 per cent.

The ANU’s Australian Electoral Study, undertaken following each election since 1993, shows that trust in government has declined by 16 percentage points over that period to just 26 per cent. This loss of trust is particularly pronounced in regional Australia.

Trust in Australia’s business community isn’t as low, but it is too low; and international comparisons are confronting. The 2018 Edelman Trust Barometer shows that the level of trust in Australian business is well below the global average, and below countries such as Columbia, South Africa and China.

The leaders of large Australian businesses have never been under greater scrutiny.  All of us should have a good sense of the reasons for that.  In several important respects, we have fallen well short of community expectations; we have lost the trust of the communities in which we do business.

In banking and finance, there can be no doubt that, if customers had been better served, misconduct better addressed, and sooner, we would not be participating in a Royal Commission today.

Several areas of infrastructure provision are at risk of being referred to similar commissions of inquiry, and for the same reason.  Public trust in the capacity of government and business to deliver infrastructure that suits community needs is poor.

NAB this year surveyed more than 1,000 Australians across the country about their experience of infrastructure. They told us that the provision of infrastructure is failing to keep up with the pace of change, especially with the demands of a rapidly growing population. For example, people reported a significant deterioration, over the past five years, in the cost of utilities and the amount of traffic congestion.  And they see things getting much worse.

We shouldn’t be surprised.  For the most part, the delivery of infrastructure that is in the best interests of the community, long-term, has been displaced by the short-term political interests of governments of the day.  Projects that should never have made the cut have been accorded top priority; others, with large expected social benefit, have been shelved.

It is not just government that has room to improve when it comes to infrastructure.

Consider, for example, the infrastructure embedded in NAB’s branches across the country.

For years, Australia’s banks have been encouraging their customers to engage with them through digital means.  The transformation in customer behaviour has been extraordinary.  Just three years ago, 42 million NAB customer interactions were conducted over branch counters.  This year, that figure is expected to drop to around 30 million. Roughly four million transactions are shifting from branches to digital channels every year.

But as our customers have become increasingly ‘digital’ in their banking, we have been closing branches.   We tell our customers that we are closing their branches because they are no longer using them.  And then we wonder that our customers get upset with us.

We know we have a lot of work to do in this area, and the issues are not straightforward, but we have made a start. In Narooma, on the south coast of NSW, having announced an intention to close the branch, we have heard the community’s reaction.  In close consultation with the community, including the local Chamber of Commerce, we are investigating what it would take to keep the branch open.  Having consulted with our customers, in their community, we can now at least see the possibility of keeping the Narooma branch open sustainably.  The approach to customer engagement in that community might serve as a blueprint for many other NAB branches across rural and regional Australia.

Rebuilding trust

Government, business, the media and NGOs need to do much more to restore trust.

We in business can make a contribution by getting serious about our social purpose, ensuring we put the customer at the heart of everything we do, and taking a longer-term approach.

At NAB, we have a CEO who understands this. Andrew Thorburn is a career banker who very much shares my and the whole NAB Board’s perspective, on these matters.  He understands that banks are not only about making money – they are about people.  Of course, banks generate returns for shareholders.  That is important, but that is not why banks exist.  Generating returns for shareholders doesn’t tell you anything about their purpose, or the vision that unites their workers, or the values they share, or their behaviours.

Andrew understands that NAB exists to improve the lives of our customers. Our purpose is to back the bold who move Australia forward. Andrew shares the Board’s absolute determination to win back the trust of our customers and our communities.

He has moved quickly to reform the way we reward front line bankers.

Recently, Andrew took the view that we should not follow the other banks and instead NAB would continue to hold its Standard Variable Rate (SVR) for home loans at 5.24 per cent. By holding our NAB Standard Variable Rate longer, we can help our customers for longer.

Andrew has invested heavily in a substantial simplification of business lending contracts and accelerated the phasing out of grandfathered commissions in our wealth business.

He has also announced that farmers may have access to interest offsets in their Farm Management Deposit accounts, and he has removed penalty rates applying to late repayments in drought-affected areas.

Andrew and his senior leaders have visited six communities in rural and regional Australia over the past six weeks, with another seven planned, to hear first-hand what these communities want from the bank; what we have been doing well and where we need to do better.

Through these investments Andrew is trying to figure out how NAB must transform to ensure that it really does do the right thing for the customer, everywhere and every time.

Andrew’s journey in transforming NAB is still in an early phase, but it seems to me that, already, there are lessons for all of us.

As part of rebuilding customer and community trust, business should recognise the powerful role it can play in ensuring Australia has the right infrastructure, in the right places; infrastructure that is affordable, reliable and sustainable.

The role of business in infrastructure

One of the paradoxes of economic growth is that its principal driver, population growth, is generally not welcomed by the current population, but is welcomed by its business leaders.  It seems very likely to me that the incapacity of Australia’s business leaders to deal with this paradox in an authentic manner is one of the reasons for their having lost the trust of the broader community.

We business leaders must accept some responsibility for ensuring that strong population growth, and the investment opportunities accompanying it, lifts economic and social opportunity for all, and not only for our shareholders, without damaging the quality of the environment passed onto future generations.

That means that we have to take an interest in traffic congestion, housing affordability, urban amenity and environmental amenity, including climate change mitigation and adaptation.

If we in business want better access to skilled domestic workers, then we are going to have to offer those workers the prospect of better lives.

If we want modern and efficient infrastructure, then we are going to have to take an interest in the design of our cities; we are going to have to take an interest in regional development; and we are going to have to take an interest in the planning of new urban centres.

We play a powerful role in determining what infrastructure is needed where, because Australian businesses largely decide where people work, and that’s the most important determinant of where people live.

I can point to two recent examples of NAB having put a lot of thought into location decisions, based significantly on transport considerations. In Melbourne, we chose to position our new office at 700 Bourke St, right next to Southern Cross station, one of Melbourne’s biggest public transport hubs.  And at Parramatta Square, NAB will be the anchor tenant in a building accommodating up to 3,000 employees, providing good jobs for the large and growing population in Western Sydney.  Parramatta Square’s proximity to the Westmead medical precinct is also advantageous; both commercially and for our workforce.

Australian National Outlook

I’ve spoken a bit about NAB.  But we are not alone in recognising the role business and other non-government bodies can play in ensuring that Australia meets community needs for infrastructure, through advocacy, thought leadership, and the commercial decisions we make.

The Australian National Outlook is a collaborative venture, led by CSIRO and NAB, that includes more than 50 leaders from more than 20 business, community and other non‑government organisations, all committed to building a better future for Australia. The organisations represented in the ANO project include companies like Shell, LendLease, and Australia Post; three universities; leading charities including The Red Cross; and other thought leaders like The Wentworth Group of Concerned Scientists and The Grattan Institute.

The ANO project draws on CSIRO’s world-leading integrated modelling and assessment capabilities to model possible future outcomes for Australia to 2060.  The scenario work is designed to stimulate a national discussion about Australia’s future, and to encourage considered action from many, towards a more positive future.  We are working on a report now, exploring how Australia’s long-term future prosperity can better be secured, and what actions we, as individual organisations, or collectively, can take, without having to wait for government.  I look forward to sharing more details over coming months …

There are many levers we can pull to foster innovation, but infrastructure plays a big part.

Earlier this year the Australian Government called for submissions on the impediments to business investment in Australia.  Australia’s two largest innovation-focussed advanced manufacturing companies, Cochlear and CSL, made a joint submission which, among other things, highlights the importance of clusters of research and clinical facilities for innovation in the medical research and related technology sectors.  Such innovation hubs, or clusters, help to encourage the exchange of ideas, attract researchers and research funding and can act as an incubator for start-ups.

Cochlear and CSL point out that in considering new investments, such as the building of a new hospital, government and business should be cognisant of existing or emerging clusters and take advantage of co-location opportunities.

Customer Stewardship

What, specifically, is the role of customer stewardship?

Customer stewardship is defined by the Better Infrastructure Initiative at the John Grill Centre, in their latest Policy Outlook Paper, in the following terms:  “the collective management principles and practices that focus on long-term customer outcomes”.  It guides project sponsors, owners and operators, helping them to deliver services that translate effectively and dynamically over time into what is needed and preferred by customers and their communities.

The paper notes that neither heavy-handed regulation nor government intervention can ensure the delivery of customer-led infrastructure.   Instead, what is required is ownership with a disciplined and transparent approach and a strong focus on customer interaction to inform investment.

The required intensity of focus on the customer would be assisted by the development of a robust and independent assessment process; an assessment that lets owners and operators know where they fit in the infrastructure customer stewardship maturity journey. This assessment need not be public, though I see strong reason for transparency, and especially in order to acknowledge those infrastructure owners and operators who deliver consistently strong customer stewardship outcomes.

Some recent excellent examples are worth calling out of the BII paper.   I was struck by the innovation demonstrated in the collaboration between SA Water and Adelaide Airport, to reduce extreme high temperatures through the irrigation of open space at the airport. Extreme heat can impact on airline productivity and their customers, something that was previously considered an ‘unfixable’ problem.  At Southern Cross station in Melbourne, PPP concession holder Civic Nexus has gone beyond their contractual obligation to ensure Melbourne, its citizens and investors in the station, achieve a better long-term outcome.  And Brisbane Airport is creating a gigabit precinct, where businesses can access ultra-fast internet connectivity, to help drive productivity improvements across the city and the state.


If we are to fulfil our potential as a nation we need better infrastructure.  Better infrastructure decisions demand better performance from both business and government.

The journey to better performance might start with an acceptance of the reasons for a pronounced loss of trust in the major public institutions, of commerce and governance, that underpin economic and social development.  Right now, there is a particular opportunity for business leadership.

Even those businesses that don’t have a direct link with infrastructure development can play a strong role in determining how and where it should be delivered, by advocating for the customers and the communities they serve.

Better decisions will be motivated by customer stewardship and will all be the beneficiaries of a renewed focus on the customer.   While infrastructure projects create jobs and investment returns, the true value of infrastructure is in what it delivers for customers and, through them, the long-term social benefit provided to communities.

This is true of all business activity.  Demonstrating that we understand this to be the case will be the key to all of us in positions of business leadership regaining the trust of our communities.




Related Articles

  • Customers

Budgeting with heart: Australians prioritise family and furry friends

When it comes to budgeting, Australians are sacrificing smaller, regular purchases to free up money to keep spending on what they love most – their kids and pets.

  • 16.07.2024
  • Time to read 3 min read
  • Indigenous Affairs

Kooya – success built on family and community

How 2024 West Australian of the Year and NAIDOC Award Winner Kim Collard made his mark in business and the community.

  • 09.07.2024
  • Time to read 1 min read
  • First home buyers

Colac teen moves from couch to home with a new teapot in tow

Nineteen-year-old Noah* had been couch surfing for years, saving diligently to purchase his first home. Although he had managed to save $20,000, he was told it wasn’t enough of a deposit alone. But that didn’t stop him from settling on his new place last month.

  • 08.07.2024
  • Time to read 3 min read

Quick links

National Australia Bank — NAB

Sometimes When The Unexpected Happens, We Realise What We Truly Value. Whether A Home, Farm, Business Or Your Passion, NAB Is Here To Support You.

Business Research and Insights

For more business news and analysis, visit NAB’s Business Research and Insights.