The Australian Institute of Company Directors (AICD) applauds Treasurer Josh Frydenberg’s move to ease continuous disclosure rules, due to the uncertain environment caused by COVID-19.
Treasurer Frydenberg announced today that the government will temporarily amend the Corporations Act, “so that companies and officers’ will only be liable if there has been knowledge, recklessness or negligence with respect to updates on price sensitive information to the market.” The changes take effect for six months from tomorrow.
AICD CEO and Managing Director, Angus Armour, said, “This is a critical step in acknowledging the challenges facing the business community to rebuild in the wake of COVID-19.
“While we are strongly supportive of a robust continuous disclosure regime to maintain market integrity, practically the current environment does not allow the same confidence in making forward statements or providing guidance.
“This measure allows directors to provide greater disclosure in this uncertain environment at the same time as it maintains measures to discipline irresponsible companies to protect the community.”
The AICD acknowledges the crucial steps the Federal Government has taken to ease the burden on Australian companies during this unprecedented time, including last week’s move to regulate litigation funders.
“The upcoming Parliamentary Inquiry into litigation funding and class actions remains an opportunity to look closely at how the system is working and examine whether permanent reform is necessary,” Mr Armour said.
Media Contact: Maegen Sykes 0439 167 567
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