The AICD is calling for ASIC to be governed by a board of directors as part of a wide-ranging review of the corporate regulator’s capability and culture.
The Australian Institute of Company Directors (AICD) is calling for ASIC to be governed by a board of directors as part of a wide-ranging review of the corporate regulator's capability and culture.
Having a board comprised of a majority of non-executive directors would provide greater oversight of ASIC and set the cultural tone for the organisation "from the top", argues AICD in a submission to the ASIC capability review.
The AICD recommends that the board is led by the ASIC chair, with a model similar to the RBA and boards for corporate regulators in the UK and New Zealand.
"The risk with regulators is they can become very narrow and out of touch with real business issues," said AICD managing director and chief executive officer John Brogden, discussing the proposal in Australian Financial Review.
"The fact that ASIC is likely to be funded by industry is an even stronger argument for independent engagement and oversight through a formal board structure."
In the submission, the AICD recommends that good governance principles be applied to an ASIC board, including use of a skills matrix, ensuring a diversity of background and experience (including gender diversity), performance evaluation and clear processes for managing conflicts of interest.
The expert panel conducting the ASIC capability review, chaired by Karen Chester, Mark Gray and David Galbally AM QC, will report to government by the end of 2015.
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