Former ANZ Group CEO Shayne Elliott has launched legal action against the Australian banking giant, claiming the lender breached his departure contract by withholding bonuses worth A$13.5 million ($9 million). The case, filed in the New South Wales Supreme Court, revolves around Elliott’s remuneration for the 2025 financial year and highlights ongoing tensions over executive pay following regulatory penalties for the bank.

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Background: Bonus Cuts Amid Regulatory Penalties

The ANZ board cut Elliott’s bonuses, along with other executives’ pay, after the bank agreed to a A$240 million civil penalty over multiple systemic failures. These included:

• Acting “unconscionably” in a government bond transaction
• Charging deceased customers for banking services

Elliott, who served as CEO for nearly a decade until May 2025, maintained that the bank had a “clear, unambiguous agreement” regarding his departure terms. In an emailed statement, he said:

“As you would expect, having entered into a contract, my expectation is that those terms would be honoured.”

He also noted that he had voluntarily waived his 2024 bonus and incentive payments in good faith.

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Legal Action and Court Proceedings

Elliott is seeking a court declaration that ANZ breached his contract and has requested the earliest possible hearing of his claim. The legal action comes alongside broader cuts in executive pay, with ANZ reporting approximately A$32 million in total bonus eliminations for other current and former executives in 2025.

ANZ Chairman Paul O’Sullivan emphasized the board’s position:

“The Board has been considered and very deliberate in its assessment of remuneration outcomes. We are confident in our position and we will defend this matter vigorously.”

The board had justified the zero bonus for Elliott as appropriate for 2025, taking into account overall Group performance and his accountability for non-financial risk matters.

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Long-Term Incentives and Executive Pay

Despite the bonus cuts, Elliott retained around A$7.9 million in long-term incentive pay, according to a recent proxy advisory report. This reflects the broader structure of executive compensation at ANZ, which combines short-term bonuses with long-term incentive schemes tied to performance metrics and risk accountability.

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Implications for Corporate Governance

The dispute between Elliott and ANZ underscores ongoing scrutiny of executive remuneration in Australia, particularly in the aftermath of regulatory penalties. The case highlights:

• Corporate accountability for non-financial risks
• Board discretion over bonus and incentive payouts
• Legal recourse available to executives in cases of disputed contractual terms

The outcome of the case could have broader implications for executive pay policies across the Australian banking sector, especially when banks face regulatory action.