The words are a little different, but the requirements are as good as unchanged. The new Australian Securities Exchange corporate governance principles adopted last week have shuffled more words than they have altered.
When the ASX first published its governance principles in 2003 it was a decade late to the global governance party and playing catch up after the A$5.3 billion collapse of HIH Insurance.
The 2019 reheat is straight out of the 1992 playbook.
While his “restoring trust” strategy worked, it was never a rigorous, evidence-driven exercise. It was instead a cobbling together of “best practice” ideas with the aim of warding off tougher legislation.
Some 25 years on, that self regulatory approach remains deeply flawed.
Australia’s 2003 code didn’t stop the company collapses during the global financial crisis or the systemic misconduct revealed in the royal commission.
The latest revisions have variously been reported as a “potent mix of new and increased recommendations for company directors” and worthy of applause, but the commentary glosses over some fairly obvious problems with self-regulation.
The changes are minor.
- ^ British 1992 Cadbury Report (www.ecgi.org)
- ^ a fourth time (www.asx.com.au)
- ^ City of London grandee Sir Adrian Cadbury (journals.sagepub.com)
- ^ “potent mix of new and increased recommendations for company directors” (www.theaustralian.com.au)
- ^ worthy of applause (www.afr.com)
- ^ social license to operate (theconversation.com)
- ^ politically correct nonsense (theconversation.com)
- ^ diversity and gender equality (www.smh.com.au)
- ^ Carillion (www.theguardian.com)
- ^ Gupta (theconversation.com)
- ^ KPMG (www.bbc.com)
- ^ McKinsey (www.nytimes.com)
- ^ Bell Pottinger (time.com)
- ^ Satyajit Das (asia.nikkei.com)
- ^ Stephen Long (www.abc.net.au)
- ^ Alan Kohler (www.theaustralian.com.au)
- ^ Adele Ferguson (www.smh.com.au)
- ^ Tim Colebatch (insidestory.org.au)
- ^ broaden directors duties (www.afr.com)
- ^ business bashing (www.afr.com)
- ^ ASX code should be abandoned (theconversation.com)
- ^ has happened in Germany (theconversation.com)
- ^ Solving deep problems with corporate governance requires more than rearranging deck chairs (theconversation.com)
Authors: Warren Staples, Senior Lecturer in Management, RMIT University