ASIC roundtable to tackle CHESS concerns

Yasmine Raso

Senior Journalist, Financial Newswire

17 July 2023

Off the back of several announcements regarding the Australian Securities Exchange (ASX) CHESS Replacement Project, the Australian Securities and Investments Commission (ASIC) said it will be hosting an industry roundtable to discuss “the proposed solution” to support the project.

Chaired by ASIC Chair, Joe Longo, the roundtable will also be attended by ASIC Commissioner, Danielle Press; newly appointed Governor of the Reserve Bank of Australia (RBA), Michele Bullock; and more than 12 select industry leaders from different sectors and professions.

The solution the corporate regulator is proposing involves a “high-level industry advisory group” established by the ASX to support its CHESS replacement project, with an independent chair to “advise on significant strategic clearing and settlement issues relating to cash equities trading in Australian markets”.

The announcement comes after numerous concerns raised by industry stakeholders over the competence of ASX’s engagement and governance strategies, as well as its management of intragroup conflict of interests.

“ASX’s effective engagement with industry is an urgent issue that must be resolved in order for the overall project to get back on track,” Long said.

“The establishment of an appropriate stakeholder advisory group for cash equity clearing and settlement matters is critical to the restoration of confidence in ASX’s decision-making and culture.

“It is vital that ASX gets its stakeholder engagement on the CHESS replacement right. Ultimately all parties, including ASX, will need to be committed to genuine collaboration and consultation and to the success of an advisory body.

“The industry now has the opportunity to be part of that solution, and it is in the national interest to do so.”