LEIGH SALES, PRESENTER: Tomorrow top business, union and social services leaders will attend a national economic reform summit, aimed at compelling Australia's political leaders to work together to make some tough decisions.

Some of the big topics for discussion are tax reform, superannuation and workplace participation.

The gathering is unapologetically aimed at putting pressure on the major political parties to tackle some of the big economic challenges that have been on the backburner for a variety of reasons - including failure to cooperate, a lack of will and fear of electoral backlash.

One of the high-profile business leaders attending the summit will be the Commonwealth Bank CEO, Ian Narev.

We sat down together in Sydney earlier today.

Ian Narev, let me start with a really broad question: how do you view the health of the Australian economy generally at the moment?

IAN NAREV, CEO, COMMONWEALTH BANK: Well, Leigh, we announced our financial results a couple of weeks ago and what we said is that through those results you can see there are some really good foundations in the economy. There was a bit of credit growth. Businesses are doing OK, credit quality was OK, savings rates were high.

But we pointed out then, not really foreseeing what was necessarily going to happen over the next couple of weeks, that global uncertainty still weighs on the economy. We're an open economy and when you see things happen, whether it's in the US or China or Europe, that can affect confidence. And above all else, the key for the Australian economy is in many ways for people just to understand it's actually quite good and to have the confidence to invest and the confidence to create jobs.

LEIGH SALES: How concerning is the big picture globally at the moment? We've seen some real volatility in China in the past few weeks and worrying signs over the longer term than that and then that volatility spilling into other markets. Is it something need to be worried about?

IAN NAREV: The themes that markets are reacting to now - a slight slowing in China, US monetary policy, Europe - these are themes we've known about for quite a long time. They're not actually new themes.

But we've been in a really unique period in the world's financial history, coming out of the Financial Crisis. And to some extent there's always been a question of: well, how is all this going to play out?

As the US raises interest rates, as China's growth inevitably slows as it was always going to. And because markets are jittery, whenever there's the first sign of slightly bad news they tend to react very swiftly. Then there's algorithmic trading, which sort of doubles down on market trends and you get a lot more volatility.

So we've got to get used to the fact that over the next few years there is just going to be more volatility. And we've got to keep our eyes really clearly on the long term.

LEIGH SALES: You're attending a big economic summit tomorrow, looking at ideas for reform. What do you think are the key priorities for reform that would allow us to ride some of those waves of volatility better?

IAN NAREV: I think the number one point of common understanding needs to be: the economy has done well, but the circumstances that led it to do well over the last decade are not going to be the circumstances over the next decade.

And I think if there's one thing that we all want to align on, no matter which part of the economy we're coming from - whether it's from trade unions or ACOSS or from the business side - is actually all to embrace the fact that change is required.

We all need to understand that now is the time where we've got to have the building blocks of what's going to make the economy successful into the future, because it will not be the same things that have made the economy successful in the last 15 years.

LEIGH SALES: And what are the changes that you would be pushing for?

IAN NAREV: Well, the number one area where we're really going to be focusing on is tax. And we've said that the tax reform, with all options on the table, must be a critical policy priority. We've said that we think from the BCA's point of view - the Business Council - that raising the GST needs to be part of that.

But we've also said that we need to understand that if you're changing policies like the GST, you must understand where that change puts more of a burden on people, particularly people who don't have the means to necessarily be able to afford the extra GST.

LEIGH SALES: What did you think of the idea that the Treasurer floated this week of personal income tax cuts?

IAN NAREV: I think there's no doubt that, in the area of both personal income burden and corporate income burden, what we would like to create is an environment where you can lessen the burden so people have more freedom over what they're going to spend and want to invest more.

In many cases, cuts to personal tax - and I think the discussion on bracket creep is very valid; I think the Treasurer made some very valid points there - or company tax cuts: they've got to be talked about as part of a broad dialogue.

And it's that broad dialogue, prosecuted with urgency, that we really want to see as an outcome of what we're talking about tomorrow.

LEIGH SALES: Do you see, though, any evidence that there is the political will or leadership there, on either side of politics, to actually make that happen?

IAN NAREV: Part of the idea of the summit we're going to have tomorrow is: we're actually listening to politicians who have said to us from both sides of politics, some of the political realities are difficult.

So what we've said is: look, it's very easy to sit back here and criticise the Government or criticise the Opposition or lament about Canberra. Actually, we've got to get on with what we can get on with.

We're not relieving them of the burden to step up, the responsibility to step up. We're just saying: in addition to that, rather than just sit there and criticise, which is the easy thing to do, let's focus on trying to get done what we can get done at the same time.

LEIGH SALES: Let me ask about housing because housing affordability has been a keen discussion for quite a while. Do you think that we're in a housing bubble in some parts of Australia?

IAN NAREV: Well, first of all, housing affordability should be part of the promise of the Australian community. That's part of what makes Australia an attractive place: the idea that people can own their own house and live there. And I think that's a really important value of the community in Australia.

In terms of the housing market, when we look at it from the bank's point of view we see 1,000 different housing markets in Australia. Some of them have actually been quite depressed over recent times and others of them, particularly inner-city Sydney, inner-city Melbourne, have grown quickly.

We wouldn't describe that as a bubble. What we would say is: whenever you get sustained periods of growth in parts of a housing market, you just need to watch it carefully. And the regulators, bank CEOs and others have all aid said, "Yes, we're prepared to watch it carefully. We won't get carried away by exuberant markets."

LEIGH SALES: You've mentioned the centrality of the idea of owning your own home to Australian values. Is that going to be realistic, though, for people going into the future, even when we look at the relationship between prices and wages right now?

IAN NAREV: Well, part of it's going to be the understanding on the part of the individual, as I had when I first bought my home and you probably did as well. You can't necessarily, when you first buy a home, buy where you most want to live. And that's the response of the individual to understand it might be a step up into, really, where you want to live.

But an equal part of this is to say: while the population's growing in Australia, while there's immigration, there is going to be naturally increasing demand. And to date supply has not met the increasing demand. That puts upward pressure on prices.

So a big part of this is going to be to make sure that, at state and federal levels, commitments that are being made to improve infrastructure, to open up new possibilities of places to live: that in turn brings prices down because there's more supply and that will really help affordability.

LEIGH SALES: You spoke at a function today about gender equality in the workplace and I want to ask you a little bit about what the Commonwealth Bank does in regards to that.

One of the biggest barriers to women's participation at senior levels is that they often hit those levels at the same time as they have young children and it's hard to juggle work with home responsibilities. What is the CBA doing to encourage men out of the workplace, to take more of the slack on the home front to help women then participate more fully at work?

IAN NAREV: I think it's a really importantly phrased question because the typical reflex has been: "What are you doing to help those women?", which is an important part of it.

But a big part of what we're now thinking about is to actually also say to men: if you want to make the choice to spend part or all of your time raising the children, that's a choice that we should not only embrace but congratulate you for and make happen.

And our goals - and we're nowhere near there yet, I want to add - are to create an environment where, whether you're a man or a woman, you are able to make the choices where you can achieve the balance that works for you between having a successful career and looking after your family and not see them as mutually exclusive.

LEIGH SALES: Ian Narev, thank you very much for joining us today.

IAN NAREV: Thank you, Leigh.