Market structures and market integrity - ASIC Update on Australian markets
A speech by Cathie Armour, Commissioner
Australian Securities and Investments Commission, CFA Societies Australia 2017 Conference (Melbourne, Australia), 1 November 2017
Good morning ladies and gentlemen.
Let me also begin by acknowledging the Traditional Owners ongoing connection to and custodianship of the lands on which we meet today, and to pay my respects to elders both past and present
I am delighted to be speaking at the CFA Australia Investment Conference this year.
On many levels, the objectives of the CFA and ASIC are aligned – in seeking to achieve better outcomes for investors:
- the CFA – through promoting the highest educational standards and high standards of ethical behaviour; and
- ASIC – through demanding fair and efficient markets and building investor trust and confidence.
While we regulate you, when we are regulating our markets we are regulating for you.
Today I will be talking about Australia’s markets.
First, I will touch on the current state of our dynamic markets.
Then, I will outline ASIC’s perspective on innovation and how it relates to financial markets.
Lastly, I will peer over the horizon at what is in store for our markets.
When we speak of ‘markets’ what exactly do we mean?
Of course we mean the securities and futures exchange markets that are readily accessible to all investors.
But these are not the only critical financial markets in our economy.
Those exchange markets only account for 34% of gross Australian turnover.
The remaining 66% of turnover is done in our wholesale OTC markets – that is OTC derivatives, foreign exchange and other non-exchange traded products. And, when I am using the term ‘markets’ I am encompassing all of these critical Australian markets.
My message today is that innovation and technological advancement has the potential to deliver exceptional benefits in all of these markets – after all innovation driven by technological change is nothing new in these markets; though the pace of change is accelerating. We all know ASIC and the industry must embrace the changes innovation poses to realise these benefits for our economy.
But ASIC will not lose sight of the fundamental purpose of markets – for the traditional and most important users – those looking to raise capital to support their businesses in the real economy and those looking to invest and manage risk.