Commonwealth Bank chair warns US tech threatens Australian way of life
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The news: The chair of the Commonwealth Bank, Paul O’Malley, has warned US big tech companies are threatening Australia’s tax base, economic security and ultimately its quality of life, naming it as one of the thorniest issues facing the country.
What they said: Speaking at the Australian Governance Summit in Sydney, O’Malley said one of the biggest challenges he saw was global hyperscalers extracting value from Australia “without having built the infrastructure and the institutions that support that value”.
“If the tax pool in Australia diminishes because economic rents are extracted out of Australia to global institutions, then our ability to fund everything that is essential and unique about Australia’s great quality of life is at risk,” O’Malley said.
“So from a big picture perspective, to answer your question, we need to understand about how Australia maintains its competitive advantage, protects the institutional capacity to earn income that supports jobs in Australia. But the essential services and the quality of life that Australians — I think that is at risk.”
He argued that Australia had to date managed to compete globally on the back of its key strengths in its people, education, and governance, but needed to have a national conversation so it could face down the current threat.
“We have to be really clear about when we’re going to defend the economic rent staying in Australia to support Australian way of life, not being extracted without us getting the fair share of it,” he said.
“We have to make sure we’re competitive as a company and we feel CBA is large by Australian standards, [but] incredibly small by global standards. We’re leaning into AI and tech so that we can understand where the competition is going to be and do our best for the company and Australia.”
The session moderator then asked O’Malley, “are you actually sort of warning directors that we could be at risk of being done over?” to which he replied, “yes”.
The context: It extends on comments made by CBA chief executive Matt Comyn who warned Australia risks creating an uneven playing field between the large domestic companies which are significant employers and taxpayers, and big foreign tech companies, which generate significant profits without making a comparable contribution.
The bank has also become increasingly vocal on the deployment of AI as both an opportunity for Australia and a risk. It published an industry paper on its approach, and the governance controls it is implementing on the technology, a week before it cut 300 jobs and launched a retraining program for impacted staff.
The source: AICD Conference
