Sydney: Westpac Banking Corp. remains under pressure over a money-laundering scandal even after the resignation of its chief executive officer, with powerful shareholder advisers calling for more changes to the board.

Institutional Shareholder Services Inc, which has about 2,000 institutional clients globally, is recommending a vote against the re-election of directors Nerida Caesar and Peter Marriott and against the bank’s pay report at Westpac’s annual general meeting on Dec. 12. A second proxy advisory firm, CGI Glass Lewis, is also recommending Marriott’s departure but stopped short of calling for a vote against the remuneration report and Caesar’s re-election.

“All directors share in the collective accountability for governance and risk failure,” ISS said in its report. It stopped short of backing a motion that could result in the entire board being voted out, but said “ongoing scrutiny” of progress in tackling governance issues is needed.

Australia’s second-largest lender has been engulfed by the scandal since the financial crimes agency last week alleged it breached money-laundering laws 23 million times and failed to detect the funnelling of money to child pornographers in the Philippines. Under mounting pressure from institutional investors and government ministers, CEO Brian Hartzer resigned on Tuesday, Chairman Lindsay Maxsted brought forward his retirement and director Ewen Crouch, who heads the risk committee, said he wouldn’t seek re-election to the board.

While the resignations have eased pressure on the bank, the criticism of the governance failing has not abated. The lawsuit has shone a spotlight yet again on structural problems in an industry that was lambasted earlier this year for a runaway culture of greed and poor behaviour.

Westpac’s shares closed 0.2 per cent lower in Sydney Wednesday, taking the total decline in market capitalisation since the lawsuit was announced on Nov. 20 to A$6.2 billion ($4.2 billion).

“We demand very high standards from our financial institutions, and it’s right we demand high standards, and it’s right we expect those standards to be met,” Reserve Bank of Australia Governor Philip Lowe said after a speech Tuesday night. “And when they’re not met there needs to be accountability.”

In a potential sign of the reputational hit the bank has taken, the Australian newspaper reported Wednesday that Westpac won’t be chosen to take part in the government’s new program to support lending to first-home buyers. The National Housing Finance and Investment Corp., which is overseeing the initiative, declined to comment on the report.

The Australian Council of Superannuation Investors, a body that represents 39 funds overseeing a combined A$2.2 trillion on Tuesday said it will push for more board renewal next year.

Kim Farrant, a portfolio manager for responsible investments at pension fund VicSuper, said the volume of under-reporting exposed by the lawsuit showed “a material lack of due diligence of both correspondent banks and customers and point to a direct failure by Westpac’s senior management and board.”

“We must remember that these are not just financial transactions, that they impact real people,” she said, adding VicSuper planned to “strongly voice our concerns” at the AGM “via the director re-election resolutions and, if necessary, remuneration report voting.”

Shareholders typically vent their frustration at AGMs by voting against the remuneration report, and the bank suffered a large vote against executive pay last year after a government-appointed inquiry exposed widespread misconduct across the banking industry. Should more than 25 per cent of shareholders vote against the pay report on Dec. 12, that would constitute a so-called second strike — and trigger a motion which if passed would force all directors to seek re-election.

ISS is recommending a vote against the pay report, citing a lack of alignment between executive pay and shareholder outcomes. But it isn’t in favour of a motion to oust the board at this stage.

Given Maxsted is retiring and Crouch isn’t seeking re-election, “shareholders may consider that reasonable steps have started for board renewal,” ISS said. “Ongoing scrutiny will be required by shareholders to monitor progress by the board and management, in addressing ongoing governance concerns.”