Australia’s corporate regulator has defended itself against criticism that it has not been tough enough in enforcing the law.
Australian Securities & Investments Commission (ASIC) Deputy Chair Sarah Court was responding to suggestions at the Australian Shareholders Association (ASA) annual conference.
ASA delegate Chris Maxworthy said ASA members were disappointed that ASIC had failed to prosecute Alan Joyce over share purchases while he was CEO of airline Qantas.
“That, to me, was unconscionable, that there was no consequence from the regulator,” Maxworthy said during a question and answer session with a panel of regulators.
“I believe that ASIC should have done something there, or at least come out publicly and made statements that ‘this is just not on’.
“I would like to see an enforcement and a return to common decency where power doesn’t necessarily equate to getting your own way.”
While not commenting on Qantas, Court said ASIC had fundamentally changed its approach to enforcement since the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, which published its last report in 2019.
“We are in court pretty much every day holding companies … to account,” Court said.
She cited litigation against Westpac, ANZ, IAG, Harvey Norman, Latitude Financial, AustralianSuper and Cbus and insider trading prosecutions.
“To suggest that, without really looking at the facts about what ASIC, as your financial conduct regulator is doing, I have to say I reject that,” she said.
“If you ask any director or executive across banking, insurance or superannuation, is ASIC an active regulator, I defy you to find any people in those companies who suggest we are a soft touch in any way,” Court said.
ASX Limited Chief Compliance Officer Daniel Moran said ASIC’s non-enforcement actions were an impactful, meaningful and underrated part of its tool kit, which had been overtaken by a focus on prosecutions.
“When ASIC engages with a company about how it’s behaving, even if short of commencing enforcement action, it’s a big deal,” Moran said.
“It does have an impact. It’s an impact that not everyone sees.”
