We explore the sensitivity of Southern Ocean surface and deep ocean temperature and salinity biases in the FOCI coupled climate model to atmosphere-ocean coupling time step and to lateral diffusion in the ocean with the goal to reduce biases common to climate models. The reference simulation suffers from a warm bias at the sea surface which also extends down to the seafloor in the Southern Ocean and is accompanied by a too fresh surface, in particular along the Antarctic coast. Reducing the atmosphere-ocean coupling time step from 3 hours to 1 hour results in increased sea-ice production on the shelf and enhanced melting to the north which reduces the fresh bias of the shelf water while also strengthening the meridional density gradient favouring a stronger Antarctic Circumpolar Current (ACC). With the shorter coupling step we also find a stronger meridional overturning circulation with more upwelling and downwelling south and north of the ACC respectively, as well as a reduced warm bias at almost all depths. Tuning the lateral ocean mixing has only a small effect on the model biases, which contradicts previous studies using a similar model configuration. We note that the latitude of the surface westerly wind maximum has a northward bias in the reference simulation and that this bias is unchanged as the surface temperature and sea-ice biases are reduced in the coupled simulations. Hence, the surface wind biases over the Southern Hemisphere midlatitudes appear to be unrelated to biases in sea-surface conditions.