A Quick Look at CPS 230 APRA: What Australia’s Standard Means for Financial Institutions

The CPS 230 APRA standard represents one of the most significant shifts in how Australian financial institutions manage operational risk. Introduced by the Australian Prudential Regulation Authority (APRA), CPS 230 is designed to strengthen resilience by improving oversight, risk visibility, and accountability across critical operations.

This standard moves beyond reactive risk management. It encourages a culture of preparedness and clarity. And it ensures organizations are compliant and capable of withstanding disruptions that come with increasing complexity, outsourcing, and digital transformation.

Here are 10 things to know about CPS 230 APRA:

1. It applies to all APRA-regulated entities, including banks, insurers, superannuation funds, and private health insurers

2. CPS 230 replaces and consolidates multiple previous standards, creating one unified framework

3. The focus is on protecting “critical operations”—services that, if disrupted, could impact customers or financial stability

4. Organizations must maintain a living register of material service providers, updated and submitted to APRA annually

5. Formal contracts with vendors are required, with clear SLAs, audit rights, and termination protocols

6. Due diligence isn’t a one-time task—ongoing vendor risk assessments are expected

7. Business continuity plans must be in place and tested regularly, with APRA notified within 24 hours of activation

8. Boards and senior leaders are held directly accountable for operational resilience and vendor oversight

9. Real-time risk monitoring and reporting are essential, supported by effective information systems

10. Noncompliance can lead to remediation programs, APRA interventions, and reputational damage

Final Thoughts

As CPS 230 APRA takes effect, financial institutions should focus on refining their operational risk frameworks, building stronger third-party oversight, and making resilience a board-level priority.

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