Reading Wednesday’s Senate inquiry report on our corporate regulator, the Australian Securities and Investments Commission, its flaws, indolence, ineffectiveness and state of cultural disease suggest it’s a dog rather than a watchdog.
“For the matters where ASIC proceeds to take enforcement action, the civil penalties imposed are often at odds with the scale of the offending, and few criminal sanctions are achieved. Further, ASIC’s investigation and enforcement decisions are opaque and difficult to scrutinise.”For decades, ASIC has been the subject of criticism, so an inquiry into its structure and performance provides fertile ground for any politician looking for a headline.
It was accused of having an unhealthily cosy relationship with the companies it was required to regulate, to the point it was widely labelled a captive regulator. Ongoing criticism of ASIC has arguably spawned the siege mentality it often displays – one that may be accountable for what the Senate report describes as a lack of transparency and cultural issues.To be fair, the degree of success of any regulator is often the product of its funding relative to the size of its remit. And while ASIC has received some additional finance over recent years, it has an enormous job with arguably insufficient resources.
This includes Australia’s $4.75 billion of pooled management funds and $3.9 billion of retirement savings.Other than the Senate committee’s push to split ASIC into two agencies, its other suggestions are both thoughtful and reasonable.
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