ASIC strategic review results in restructure

23 October 2008 Topics: Compliance and corporate governance

Corporate watchdog ASIC is set to be restructured following a strategic review by an independent consulting group.

Completed in May this year, the ASIC Strategic Review drew on the opinions of 1250 stakeholders in a bid to streamline ASIC’s structure going forward. Input was sought from business, consumers and ASIC staff.

On releasing the findings, ASIC Chairman Mr Tony D’Aloisio commented,

“The review will result in us being closer to the market, we will be more accessible and flexible, and we will be able to take emerging trends into account more quickly.”

This perhaps echoes calls from business for ASIC to be more reflexive to changing markets. As ASIC’s recent prohibition on short-selling shows, being in touch with the marketplace is vital for ASIC in successfully putting its regulatory function into effect.

Business the beneficiary

ASIC suggests that business will be the main beneficiary of the Strategic Review. As a result of the review, ASIC says that it will be better placed to:

  • understand the markets which it regulates;
  • articulate the reasons for its involvement in the market;
  • be more forward-looking in assessing systemic market risk; and
  • develop a clear priority areas for regulation moving forward.

In furthering these ambitions, ASIC has indicated that greater attention will be paid to regulation of retail investors, insider trading, disclosure and artificial market manipulation.

Investment in people

To deliver its vision, ASIC will make a greater investment in people, training and development. Putting this into practice, it plans to build the skills of its existing staff and recruit laterally from the ‘big end of town’.

ASIC will also restructure its operations to provide greater transparency and accountability. Some initiatives include:

  • the appointment of an experienced External Advisory Panel drawn from various sectors of the economy;
  • the abolition of its current directorate system, replacing it with 17 discrete stakeholder teams dedicated to sector-specific regulation;
  • additional resources directed towards supervision of brokers and intermediaries; and
  • a reduction from 54 senior positions to 41 with increases in remuneration levels for new positions.

Bridging the gap

While the impact of these changes remains to be seen, the restructure sends a clear message to the marketplace that ASIC intends to be more accessible, proactive and responsive to the market’s changing needs.

With a streamlined structure and a market-focused awareness, this restructure may go some way to bridging the divide between the corporate watchdog and the businesses it regulates.

If you would like more information on these changes, please contact David Grace on 07 3231 2940.

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