Brian Houston was leading the Assemblies of God in Australia group of churches (now the Australian Christian Churches) when he confronted his late father Frank Houston about the sexual abuse allegations against him in 1999.
Frank Houston confessed to abusing a boy in New Zealand during the 1970s, and Brian dismissed his father from his ministerial and preaching positions.
The royal commission found that Brian Houston never reported the allegations or confessions to the police, and that he had a conflict of interest as Frank Houston's son.
It also found the Assemblies of God in Australia leadership team didn't follow the established complaints procedure, didn't interview the victim about his abuse or give him a designated contact person, did not interview Frank Houston, and didn't record any of the steps it took to deal with the allegations.
It was later revealed Frank Houston abused up to nine boys in the 1970s and 1980s in Australia and New Zealand. Despite this, he never stood trial and died in 2004.
Speaking in the royal commission, the victim claimed that Frank Houston and another church member met him in a McDonald's restaurant and attempted to bribe him. He said Frank Houston offered him AUD$10,000 and urged him to sign a dirty napkin saying: "I don't want this on my head when I stand in front of God."
A statement on the Hillsong Church website said: "Hillsong Church welcomes this Royal Commission and fully supports its objectives.
"Hillsong was asked to appear not because of anything that happened here but because of the abuse suffered by children at the hands of my father around 40 years ago when he was based in New Zealand - many years before Hillsong Church existed and when I was a teenager myself.
"I have shared that when I first found out about this, I immediately confronted my father and ensured he never preached or served in any ministry capacity again. There was no delay in action - from the moment we knew and he confessed, his ministry stopped.
"There have been reports of money being paid to the victim. Again for clarification, this was between my father and the victim. It had nothing to do with me or Hillsong Church.
"Be assured that we did not tolerate sexual abuse when we heard of these allegation in 1999 – and we don't now. Hillsong Church has zero tolerance for abuse.
"Please keep praying for those affected by sexual abuse and for the victims in the cases involving my father."