This is a service specifically targeted at the needs of busy non-executive directors (NEDs).  We aim to give you a ‘heads up’ on the things that matter for NEDs in the week ahead – all in two minutes or less.

In this edition, we discuss the announcement of proposed reforms to strengthen and modernise the Reserve Bank of Australia (RBA) and the 2024 enforcement priorities announced by the Australian Securities and Investments Commission (ASIC).  We also examine the public consultation by the Commonwealth Treasury on merger rules reform and the application received by the Takeovers Panel from Mighty Kingdom Limited (ASX: MKL) (Mighty Kingdom) in relation to its affairs.

In Over the Horizon, we discuss the Federal Government’s release of the 2023-2030 Australian Cyber Security Strategy and what that means for Australia’s cyber profile in the coming years.

REGULATION

Federal Government announced proposed reforms to strengthen and modernise the RBA.  On 27 November 2023, Treasurer Dr Jim Chalmers announced that the Federal Government will introduce legislation to the Parliament of Australia this week to reform, strengthen and modernise the RBA.  The bill will implement the recommendation of the RBA review, which was released in April 2023, including to: (1) mandate that the RBA’s overarching objective is to “promote the economic prosperity and welfare of the people of Australia, both now and into the future”; (2) confirm that monetary policy should have the dual objectives of price stability and contributing to full employment; (3) reinforce the RBA’s independence, including by repealing the Treasurer’s power to overrule its monetary policy decisions; (4) establish a Monetary Policy Board and a separate Governance Board; and (5) clarify the RBA’s responsibility to contribute to financial system stability.  See Treasurer's media release.

ASIC announces 2024 enforcement priorities.  On 21 November 2023, ASIC announced its enforcement priorities for 2024, “indicating its enforcement focus for the coming year and communicating its intent to industry and stakeholders”. ASIC noted it has added a number of new priorities including: (1) a focus on “member services failures and misconduct relating to the erosion of superannuation balances”, as well as “insurance claims handling, compliance with financial hardship obligations and the reportable situation regime”.  ASIC Deputy Chair Ms Sarah Court announced ASIC’s continued focus on strong enforcement outcomes at the ASIC Annual Forum in Melbourne, noting that ASIC is adopting a more aggressive stance to enforcement and penalties.  ASIC also notes that it has retained its priorities concerning greenwashing, enforcing design and distribution obligations, and governance and directors’ duties failures.  Directors should note ASIC’s goal is “to create a culture of compliance across Australia’s financial system and the corporate sector more generally through decisive and high-profile enforcement action”. See ASIC media release and 2024 enforcement priorities.

Treasury announces public consultation on merger rules reform.  On 20 November 2023, the Commonwealth Treasury released a consultation paper on potential merger reform as part of its review of Australia’s competition policy settings announced in August (see previous edition of Boardroom Brief).  The consultation paper seeks input on whether Australia’s current merger control regime is effective (i.e. whether it readily enables beneficial mergers to proceed while ensuring that mergers which may pose substantial competition risks are blocked) and, to the extent Australia’s merger control regime could be improved, the options available for reform and their benefits and risks.  The consultation paper also indirectly seeks feedback on merger reform proposals put forward by the Australian Competition and Consumer Commission (see G+T Knowledge article).  Submissions on the consultation paper close on 19 January 2023.  See Treasury media release.

LEGAL

OVER THE HORIZON

Federal Government reveals roadmap to improved national cybersecurity.  On 22 November 2023, the Federal Government released its ‘game-changing’ 2023-2030 Australian Cyber Security Strategy. The Strategy is “the roadmap that will help realise the [Federal] Government’s vision of becoming a world leader in cyber security by 2030”. The Strategy is complemented by the supplementary 2023-2030 Australian Cyber Security Action Plan, which details the key initiatives that will commence over the next two years. The Strategy sets out six ‘cyber shields’, to be implemented by the Federal Government and industry. Those shields are: (1) strong businesses and citizens, (2) safe technology, (3) world-class threat sharing and blocking, (4) protected critical infrastructure, (5) sovereign capabilities, and (6) resilient region and global citizenship. The Federal Government considers the Strategy shifts cyber security from a technical topic to a whole-of-nation endeavour, “enabled by stronger public private partnerships”. The Federal Government has also invited public consultation into the Strategy and Action Plan, which will run until March 2024. See Department of Home Affairs website and 2023-2030 Australian Cyber Security Strategy.