Commonwealth Bank chair Catherine Livingston acknowledged the royal commission's criticism that customers had been hurt by the bank's focus on profitability.
Livingstone admitted at the lender’s AGM in Brisbane on Wednesday that this imbalance - where profitability reigns at the expense of customers - is not acceptable.
She told shareholders that the commission had raised questions about competency, complacency and priorities within CBA.
"When people or processes failed, there were neither the systems nor processes in place to identify and fix the problems, nor a sufficient sense of urgency to identify the root cause, and take steps to prevent similar issues arising again," she said.
"Our focus on improving overall customer satisfaction also obscured and distracted us from focusing on customer dissatisfaction, which would have alerted us to many of these issues sooner."
Shareholders heard that CBA will set up an external advisory panel advising executives on how to best engage with customers, employees and the community.
The panel will be headed up by Patricia Faulkner who served as deputy commissioner to the royal commission on family violence.
CBA shareholders also heard that chief executive Matt Comyn wrote to eight million customers in September customers to apologise for letting them down and to invite their feedback on how CBA could improve.
Evidently, more than 10,000 Commonwealth Bank customers replied to this request.
"I have received more than 10,000 responses: a mixture of complaints, compliments, and general suggestions from our customers on how we can become a better bank," Comyn said in a speech.
"My leadership team and I are personally engaging in long-standing disputes to review these with fresh eyes."
Accentuate the positive
During his address, Comyn was keen to emphasise the positives.
Importantly, he has elevated responsibility for complaints management to David Cohen, the deputy chief executive, in an effort to ensure the resolution of complaints continues to receive senior attention and oversight.
Comyn also pointed out that the lender had changed incentives for branch staff to reward service rather than sales; strengthened lending practices; is committed to systematically fixing processes to make banking easier for customers, has introduced fairer contracts for small business and established a dedicated team to help small businesses facing difficult times.
Moreover, he said CBA had partnered with AIA, to deliver new and innovative insurance solutions for our customers and is actively addressing past failures in the wealth business.