Reserve Bank board asked to investigate complaints about Governor Adrian Orr’s conduct
Tuesday, 22 October 2019
The Reserve Bank has received at least two requests to further investigate a pattern of alleged hectoring and bullying behaviour by governor Adrian Orr towards his critics.
Former Reserve Bank employee Geof Mortlock emailed board chairman Neil Quigley last week, asking the board to 'take note of and investigate' concerns raised recently about Orr's conduct.
Reserve Bank watcher and former employee, Michael Reddell, also submitted a formal letter to the board and posted it on his blog croakingcassandra. Reddell, who left the bank in 2015, asked the board to conduct, 'a serious review of the allegations'.
Both communications referred to recent Stuff reports that highlighted concerns of allegedly bullying behaviour by Orr toward the bank's critics in his fight to increase capital reserves for commercial banks.
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Last December, the Reserve Bank released its boosted capital reserves proposal and asked interested parties to make submissions. Orr characterised the process as open; however, some parties involved in the process believe openness was compromised by the governor's conduct.
In an emailed reply to Stuff's questions, Quigley said the board discussed the correspondence at its meeting last week, and '[we] have no further public comment to make'.
He also noted, 'the role of the board is to keep the performance of the bank and the governor under constant review. That is what we do at our meetings and in other contexts'.
'As a matter of personal privacy I cannot discuss the details of our assessments of the governor's performance with you.'
Reddell posted a note from Quigley on Twitter that confirmed non-executive members of the Reserve Bank board discussed his letter at last Friday's meeting.
The Reserve Bank appears to have pared back Orr's public engagements in recent weeks in light of the unfolding controversy.
In at least two instances, including Tuesday's Institute of Financial Professionals NZ conference, assistant governor Christian Hawkesby has been substituted where Orr was originally committed to speak.
Earlier in the month, the bank issued an unusual public statement after questions were put to Quigley about the governor's conduct.
'Sometimes we make difficult decisions that are unpalatable for a few, but we do that with the many in mind,' the bank said.
'We are not looking to win votes or accolades – we do what's right for the good of all New Zealanders for today, tomorrow and for generations to come.'
Mortlock said his email did not constitute a complaint. He said he wanted to draw the board's attention to an assortment of concerns, including what he described as Orr's pattern of behaviour as well as a range of Reserve Bank policy positions.
Mortlock worked closely with Orr more than a decade ago. At the time Mortlock was in the bank's financial stability department and Orr was deputy governor.
Mortlock, who subsequently worked for the Australian Prudential Regulation Authority said he was concerned that in the course of the capital review, Orr may not have genuinely engaged with people who have raised concerns.
Pressure to hold Orr to account is also mounting on Finance Minister Grant Robertson.
Responding to questions about Orr's behaviour, Robertson said, 'the matters you've raised are properly addressed to the chair of the Reserve Bank board'.
'In terms of my role, I retain confidence in the governor.'
Mortlock, however, believed Robertson appeared to be 'asleep at the wheel' and while the bank has operational independence from the government, the minister has plenty of scope to more actively assess the governor and the bank broadly, including policy formulation, its consultation processes and the way it engages with stakeholders.