Check against delivery

Good morning.

Today is my last appearance before this Committee after five years as ASIC’s Chair.

I’m joined by Deputy Chair and incoming Chair, Sarah Court; Commissioners Alan Kirkland, Kate O’Rourke and Simone Constant; CEO Scott Gregson; and Executive Director for Enforcement and Compliance, Chris Savundra.

Today, I want to offer some observations about the organisation I’ve led since 2021 – and the opportunities and challenges I see on the horizon.

Before I begin, I would like to acknowledge the essential role the members of this Committee perform within the Parliamentary system.

ASIC is the only financial regulator in the country with its own statutory oversight committee, in recognition of the deep complexity of the legislation that we administer, and its importance to the economy.^[1]

This Committee has been sitting since January 1991 when the ASC, now ASIC, was created.

And since 2002 alone, this Committee has undertaken an extraordinary 98 inquiries and reports – approximately four a year – examining a range of important issues to Australians.

ASIC – a modern, confident, and ambitious regulator

Appearing before you today concludes my term almost where it began, although I think we can agree much has changed since then.

In my first remarks to this Committee, I said I believed that “ASIC's strength and effectiveness as an institution can and will be enhanced”.^[2]

Indeed, it has, and today ASIC is a modern, confident and ambitious regulator.

Modern, because we prioritise data and technology to keep pace with a fast‑changing financial system.

Confident, because we are prepared to act decisively, publicly, and proactively to address misconduct and emerging risks.

And ambitious, because we are willing to raise the bar – for ourselves, and for the financial system that Australians rely on – by testing the law and driving systemic change through every available channel.

You can see evidence of that ambition in the breadth and depth of the matters we pursue, whether that is:

• securing $250 million in combined civil penalties from ANZ for widespread misconduct and systemic risk failures
• pursuing AustralianSuper and Cbus for devastating member service failures
• obtaining a $26 million fine against Westpac for hardship failures
• or, holding the ASX to account for serious governance and operational failures.

Ambition is why ASIC is in court nearly every day of the week – from the Magistrates’ Courts all the way to the High Court.

During the past five years, we’ve more than doubled the number of formal investigations each year and we’ve quadrupled the value of penalties obtained^[3].

This financial year, we’ve already secured approximately $484 million in penalties, not including those still subject to court approval.^[4]

So, ASIC today is undoubtedly stronger and more effective than it was five years ago.

I want to acknowledge here the important role of the Financial Regulator Assessment Authority (FRAA), in assessing and reporting on the effectiveness and capability of ASIC. In FRAA’s first review of ASIC in 2022, FRAA found ASIC was a “generally effective and capable” regulator.

Challenges ahead – trust in institutions

Turning now to the challenges, and opportunities, ahead for ASIC.

First, we need to maintain trust in our institutions, such as ASIC. We can’t have open, robust, and competitive markets without confidence and trust in the integrity and resilience of our financial system. ASIC plays a critical role in delivering this outcome.

Confidence and trust depends on people seeing ASIC boldly enforce the rules and follow through on our commitments.

One of the significant decisions that Sarah Court and I took early on in our terms was to institute a yearly practice of announcing ASIC’s enforcement priorities. These make clear the choices we make in prioritising cases and deploying our limited resources, and holds us accountable for doing what we said we would do.

Challenges ahead – enforcement envelope

Being an effective regulator means making difficult choices, and that includes choices about what we investigate and what we litigate.

ASIC does not have unlimited resources, and litigation is costly – particularly when taking on the big end of town, seeking to hold multiple officeholders to account, or addressing industrial-scale misconduct, as ASIC has done over the past few years.

This brings me to a second challenge: the sustainability of the Enforcement Special Account, or ESA.

ASIC’s strong enforcement outcomes, increasing complexity of matters, and government savings measures have significantly eroded the cash balance of this special account, designed to provide capacity for significant matters. By 30 June this year, the ESA is forecast to fall to the minimum level needed to manage the risk of adverse court orders.

Absent replenishment, this will impede ASIC’s ability to maintain its current enforcement program. We are engaging with Treasury and Government about this.

Of course, ASIC doesn’t operate in a vacuum. Effective enforcement relies on the broader system around us.

We strongly support the Federal Court’s expanded criminal jurisdiction, which allows ASIC to bring civil and criminal matters before a single, specialist court.

But capability must be matched with capacity. Frankly, we cannot expect ASIC to run more, and more timely, criminal cases if the Director of Public Prosecution’s (DPP) resource envelope to assess and determine ASIC’s referrals of briefs of evidence remains static. This is particularly so, as the demands on the DPP grow from other law enforcement agencies around the Commonwealth.

Challenges ahead – balancing enforcement and regulation

The third challenge ahead is continuing to get the balance right between active enforcement and regulation.

With a remit spanning millions of entities and individuals, ASIC faces a stark reality: we cannot litigate our way out of every problem. Litigation by its very nature is a rearview mirror. It cannot deal with many of the forward-looking challenges we face as a nation.

Challenges such as improving our national productivity, encouraging innovation, increasing financial literacy and maximising the opportunities presented by technologies, such as AI and supercomputing.

This requires ASIC’s regulatory strategy to be informed by imagination, ambition, and collaboration among all stakeholders.

This approach is reflected in ASIC’s implementation of several major reforms since 2021, including climate disclosure, digital assets and crypto in particular, the banking code, developing a roadmap for our public and private markets, and improvements in how we deal with scams.

It’s why ASIC is internationally active and engaged. Not just with other regulators, but with the global players who are doing business in Australia and contributing to Australia’s reputation for being an attractive place to invest.

It’s also why we are encouraging financial innovation, from being a key part of the Reserve Bank’s Project Acacia to exploring ways we can better support start-ups with pathways from regulatory sandbox to licensing.

And it’s why we’ve initiated a national discussion about regulatory complexity and acted to address it through our ASIC Simplification Consultative Group.

We’ve long struggled as a system to deliver timely and meaningful law reform in corporate law and financial services. At ASIC, I am continually hearing that regulatory burden and compliance costs are too high and climbing. It’s high time we did something about it.

As part of the national conversation about productivity, we need to consider how the public and private sector can better work together more effectively to reduce the compliance burden.

ASIC’s public and private markets work is a good case study on how difficult and complex problems can be addressed through structured and transparent collaboration between the public and private sectors.

Since the Corporations and Markets Advisory Committee, or CAMAC, was defunded in 2014 and subsequently abolished, a public-private mechanism to consider and recommend legislative reform has not existed in relation to corporations and financial services law.^[5] And I think it’s fair to say that the market and the general business community misses it.

In my view, a modern, updated version of CAMAC would be most welcome – and perhaps a broader, more ambitious version of ASIC’s Simplification Consultative Group, which includes representatives from business, consumer groups, Treasury and academia, could form a template for such an initiative.

Challenges ahead – the continued importance of technology, AI and data

The fourth challenge – and perhaps the most urgent – is the need to stay ahead of technological change.

Notably, FRAA highlighted in its 2022 review the urgent need for further investment in technology and data for ASIC to remain “effective, credible, and relevant” into the future.^[6] This is a call I have certainly heeded as Chair, because the pace of change is accelerating. The period between discovery and disruption is compressing.

If we do not remain institutionally engaged and curious about emerging technologies and innovation, it will be an existential risk to ASIC’s effectiveness and credibility as a regulator.

We already know that technologies such as AI will directly challenge our regulatory capability. We must rise to meet that challenge.

That means we need three things:

• Information when it matters.
• The powers to audit and test where it matters.
• And the ability to give the market clear signals about our posture and why it matters.

We must also embrace these technologies and use them for our own purposes. In other words, the forces reshaping our markets must become part of how we regulate them in future.

We are fast approaching a future where fit-for-purpose regulation is data-led, responds in real time, and anticipates problems before they escalate – backed of course by strategic and timely litigation. If we miss the boat here, we risk becoming irrelevant.

ASIC is celebrating 35 years of operation this year. However, we cannot regulate the future with tools of the past.

That’s why we are piloting access to advanced supercomputing infrastructure, in partnership with the University of Technology of Sydney’s Human Technology Institute and the Pawsey Supercomputing Research Centre in Perth, to test how predictive, probabilistic methods can support earlier detection of conduct harms and more targeted supervision.^[7]

I welcome the Government’s recent investments in ASIC, to strengthen some of our digital capabilities.

This includes a $97.3 million investment to complete RegistryConnect Tranche 2, delivering new services, linking Director IDs, and modernising and securing registry systems.^[8]

Challenges ahead – empowering consumers and investors to make good decisions

The fifth and final challenge is supporting consumers and investors to make confident and informed financial choices.

We welcome the Government’s $10.3 million investment to strengthen oversight of the managed investments schemes sector, enhancing ASIC’s digital capability and access to non-ASIC government data^[9], as well as the investment of an additional $6.2 million over four years, with $1.4 million ongoing, to improve governance arrangements and further strengthen supervision of the sector.

This will better position ASIC to respond to existing and emerging risks, including those highlighted by the Shield and First Guardian matters. However, I want to be frank that this is not a silver bullet. Investors and consumers will continue to sustain losses from time to time. The possibility of losses lies at the heart of investment risk taking - and our system of regulation encourages risk taking. ASIC cannot, nor is it our role, to always be in a position to pick up the pieces. Prevention is always better than cure.

We must continue to invest in initiatives that will empower consumers and investors to make good decisions in their own interests. Investing in financial literacy and in ASIC Moneysmart is fundamental to this.

Conclusion

I will end with a thank you to all of ASIC’s talented and dedicated people who are working very hard, every day, to ensure Australians benefit from a fair, strong, and effective financial system.

We welcome the Committee’s questions and engagement today.

[1] Joint Select Committee on Corporations Legislation, Report of the Joint Select Committee on Corporations Legislation (Parliament of the Commonwealth of Australia, April 1989), pg. 69. <https://takeovers.gov.au/sites/takeovers.gov.au/files/2021-04/JSC_corp_leg_8904.pdf>

[2] Parliamentary Joint Committee on Corporations and Financial Services, Oversight of the Australian Securities and Investments Commission, the Takeovers Panel and the Corporations Legislation No. 1 of the 46th Parliament (Committee Hansard, 18 June 2021) 33 <https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id:%22committees/commjnt/1a409708-99b5-4311-bca8-c3784e95be18/0003%22>.

[3] Formal investigations have more doubled from 110 in 2020-21 to 252 in 2024-25. The total dollar value of penalties has increased from $24.9 million in 2019-20 to $104.1million in 2024-25.

[4] As of 27 May.

[5] Ian Ramsay, A History of the Corporations and Markets Advisory Committee and its Predecessors (Melbourne Law School Legal Studies Research Paper No 818, 17 October 2018), pg. 15 <https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3267685>.

CAMAC was defunded in the 2014-15 Budget, however it was not legally abolished until 2018 through the Statute Update (Smaller Government) Act 2018 (Cth).

[6] Financial Regulator Assessment Authority, Effectiveness and Capability Review of the Australian Securities and Investments Commission (Report, July 2022) <https://fraa.gov.au/sites/fraa.gov.au/files/2022-08/asic-assessment-report.pdf>.

[7] This is a small illustration of how we are building capability to keep pace with increasingly complex harms and regulate in a more intelligence-led, future-fit way.

[8] In 2027-28.

[9] In 2026-27.