ASIC's scorecard

  • Date:01 Oct 2013
  • Type:Company Director Magazine
John Price outlines how ASIC will respond to the findings of a recent survey that measured perceptions of its performance.

The Australian Securities and Investments Commission (ASIC) recently released the findings of an independent survey that measured perceptions of the environment in which ASIC operates and ASIC’s performance. Company directors were one of the key groups that participated in the survey.

The survey found that, overall, stakeholders were positive about ASIC’s performance, with most believing we are performing better, or the same as, two years ago. Particular strengths were:

  • ASIC’s market supervision.
  • ASIC’s work keeping markets free from insider trading and ensuring companies provide reliable and timely information to the market.
  • ASIC’s work in holding to account auditors, market operators and organisations providing financial products and services.
  • That ASIC acts professionally, promotes confidence in Australia’s financial system and understands the industries and markets it regulates.
  • That ASIC is easy to deal with.
  • That its enforcement actions are transparent.
  • ASIC’s effective monitoring of compliance in industry.
  • Its guidance to industry to help organisations to comply with the law.
  • That its registration and licensing are easy, efficient, timely and cost-effective, and the information is easy to understand.

We acknowledge the efforts of company directors in contributing to many of these strong results – for instance, in taking steps to help ensure our markets are seen as fair and efficient.

The survey also identified four areas where stakeholders perceived limitations. These were:

1. Acting quickly to investigate breaches of the law
While stakeholders viewed ASIC’s work in holding gatekeepers to account as a strength, some saw the speed of our investigations as a limitation. In response, we plan to:

  • Communicate more about the process involved in investigations, the complexity of some matters and the time investigations take.
  • Continue to narrow the focus of our cases early in any investigation.
  • Continue to raise with government law reforms concerning our investigation powers and need for more flexible enforcement tools.
  • Analyse recently completed matters to assess if our investigations took too
    long, and why.

2. Communicating what ASIC is doing
A significant challenge for a regulator like ASIC, with a range of stakeholders and responsibilities, is communicating effectively about what we are doing.

We use a number of tools, such as media releases (over 300 a year), broadcast interviews (over 100 a year), Twitter (nearly 10,000 followers), YouTube videos (200+), our website (over 1.5 million visitors a month) and our MoneySmart website (over 400,000 visitors a month) to get our messages out. We also respond to close to 4,000 media queries each year. The survey indicates we are performing well in our financial literacy work, but could do more to communicate what we do, and why we do it. In response we will:

  • Undertake a structured program of communication with external stakeholders about ASIC’s financial literacy work.
  • Continue to promote the MoneySmart website to investors and consumers and key industry and consumer groups.
  • Build our social media presence and use new communication channels.
  • Review the ASIC website to further improve its accessibility.

3. Reducing red tape
We are aware of the regulatory burden on business and have introduced measures to make things easier where we can. Recent initiatives include:

  • ASIC’s national Business Names Register, which started in May 2012 and has saved businesses $34 million in fees in the first year.
  • A booklet to help small businesses comply with their legal obligations, which was released in August.
  • Using our discretion to grant relief from legal requirements where appropriate.

We are committed to cutting red tape and there are more improvements in the pipeline. For example, we will:

  • Consider whether certain legal rules that sunset in the next four years under the Legislative Instruments Act 2003 are still necessary.
  • Harmonise the market integrity rule books for different financial markets.
  • Continue to engage industry around the use of technology.
  • Continue to help business by easing compliance with regulatory requirements or advising government to remove regulations with no clear purpose.

As always, ASIC welcomes any suggestions from the Australian Institute of Company Directors on practical measures it could consider and implement (without changing the law) to reduce red tape.

4. Being resourced to do our job
Our funding is a matter for the government, but we will continue to be transparent about how we use resources wherever possible.