‘ASIC’s Forward Agenda’ – The Australian Corporate Regulator’s Approach to Timely Disclosure by Listed Companies

Abstract

The initial phrase of the title for this paper was borrowed from a speech delivered by Tony D’Aloisio, Chairman, Australian Securities and Investments Commission (ASIC), in September 2010. The Chairman stated The first point I will make about ASIC’s forward agenda for the next couple of years is that, for the most part, we will continue to do what we have been doing because it has been working well. ASIC is a regulatory oversight body and not a guarantor against risk and corporate failure. The regulator’s objective is to exercise its powers to improve the performance of the financial system and the entities within the system in the interests of commercial certainty and development of the economy. An important role is to efficiently process the information it receives under its powers and to promote informed participation by investors in the financial system. On 15 July 2011, Australia will mark the tenth anniversary of the Corporations Act 2001 (Cth) and the formation of ASIC under companion legislation. Reflecting the theme of the conference, this paper will review the regulator’s ‘past experience’ in enforcing timely (or continuous) corporate disclosure and, more particularly, the contribution of this experience to the regulator’s ‘forward agenda’? The Chairman acknowledges that ASIC has given ‘much thought to how the Australian market might evolve’. In the past year that evolution has witnessed the transfer of supervisory responsibilities for licensed equity and derivatives markets from the Australian Securities Exchange (ASX) to ASIC; the introduction of ‘market integrity’ rules directed at insider trading and market manipulation; potential Government support for competitive market trading of listed shares in Australia, and even the merger of ASX with another stock exchange. All of these issues can affect corporate disclosure. ASIC is also a party to continuous disclosure issues that are currently before the courts with the ongoing James Hardie and Fortescue cases. Consistent with the theme of the conference, the paper will endeavour to deduce the regulator’s present position on continuous disclosure and ASIC’s future agenda for enforcing the timely disclosure of material information by listed companies.