In this edition, we discuss trends in shareholder activism regarding environmental, social and governance (ESG) matters observed by the Australian Institute of Company Directors (AICD) and the penalty imposed on FIIG Securities Limited (FIIG) in relation to failures to take adequate cybersecurity measures. We also examine the Takeover Panel’s declaration of unacceptable circumstances in relation to the affairs of Identitii Limited (ASX: ID8) (Identitii).
In Over the Horizon, we consider key data released in the Commonwealth Treasury’s report on foreign investment for the quarter ending 30 June 2025, which confirms continued strong momentum for foreign investment in Australia’s Metals and Mining sector.
Regulatory
Environmental, social and governance initiatives continue to be an area of interest for shareholders.
13 February 2026, the AICD released an article detailing the trends observed across annual general meetings held by listed companies in 2025. The recurrence of questions relating to companies’ climate, nature and diversity initiatives demonstrates that shareholders continue to be interested in how companies respond to non-financial risk matters. The article notes that, in the energy infrastructure sector, there were requisitions seeking company reports on the alignment of new projects with climate commitments and due diligence regarding development partners’ compliance with health, safety, environmental and heritage standards. Companies also faced questions regarding directors’ understanding of (and attitudes towards) the company’s use of artificial intelligence (AI), data privacy and scope for productivity gains driven by AI. Directors should note that AI represents a potential new battlefield for activist investors and ensure clear oversight and communication on ESG strategy and technology matters.
Legal
FIIG Securities Limited to pay $2.5 million penalty over cybersecurity failures
On 9 February 2026, the Australian Securities and Investments Commission (ASIC) announced that FIIG had been ordered by the Federal Court of Australia to pay a $2.5 million penalty for cybersecurity failures between 13 March 2019 and 8 June 2023 (during that period, FIIG controlled approximately $3 billion in client assets. The Court also ordered FIIG to pay $500,000 towards ASIC’s costs incidental to the proceeding. ASIC brought the action following a cyberattack which targeted FIIG on 19 May 2023 and led to approximately 385 gigabytes of client data (including driver’s licences, passport information, bank account details and tax file numbers) being published on the dark web. The Federal Court of Australia found that FIIG failed to allocate adequate technological, human and financial resources to comply with its legal obligations as a financial services licensee, in contravention of section 912A(5A) of the Corporations Act 2001 (Cth). These proceedings are ASIC’s second cybersecurity enforcement action. Derrington J noted that “It would be all but impossible to prevent every cyber attack… Rather, ASIC is concerned that entities which are subject to obligations… have adequate cyber protection systems in place.” As cyber risks continually evolve, Boards should periodically monitor the effectiveness of risk management systems to ensure they are fit for purpose.
Takeovers Panel makes a declaration of unacceptable circumstances in relation to the affairs of Identitii Limited.
On 10 February 2026, the Panel made a declaration of unacceptable circumstances in relation to the affairs of Identitii, having regard to (among other things) the effect on the control, or potential control, of Identitii. On 4 December 2025, Identitii announced a 1 for 2 non-renounceable pro-rata rights issue to raise up to $2.88 million via the issue of up to 411,506,773 new shares (representing 50% of Identitii’s issued share capital) at $0.007 per share (the Offer). The Offer was partially underwritten by Identitii’s largest shareholder, Beauvais Capital Pty Ltd as trustee for the Reginald Hector Trust (Underwriter). The Underwriter would accept its full entitlement under the Offer, underwrite $1.4 million of the shortfall and be granted options in Identitii as an underwriting fee. Identitii disclosed that, as a result of the Offer, the Underwriter’s voting power in Identitii could increase from 29.92% to 49.91%. Throughout the Offer period between 15 December 2025 and 19 January 2026, Identitii’s share price did not exceed $0.007 and at times was $0.005. The Panel considered that the Offer was not structured to mitigate the effect on control. In particular, the Offer price, the Offer period and the shortfall allocation policy (including ambiguity regarding whether shortfall shares would be issued to applicants in priority to the Underwriter), did not encourage shareholder participation. The Panel ordered that Identitii must issue supplementary disclosure within seven days, following which it must re-open the Offer for at least seven days. The Panel also ordered that Identitii must offer all shareholders who participated in the Offer a withdrawal right and must not issue any securities to the Underwriter without prior shareholder approval (with the Underwriter and its associates abstaining from voting).
Over the Horizon
Foreign investment remains strong in Australian mining
On 6 February 2026, the Commonwealth Treasury released its quarterly report on foreign investment from 1 April to 30 June 2025, setting out key performance data regarding Australia’s foreign investment regulatory framework during that period. Out of 326 commercial foreign investment proposals approved across all industry sectors, 98 were approved with conditions. As discussed in a previous G+T insight, despite a complex regulatory landscape, Australia remained an attractive destination for mining capital in 2025. The report indicates that mineral exploration and development was the largest target sector for proposed investment in the reported quarter, with a total value of $19.3 billion (an increase of 328.9% from the previous quarter) across 49 approved investment proposals (an increase of 19.5% from the previous quarter). The median processing time for approved proposals was 36 days in the quarter (and 33 days over 2024/25 as a whole). Where acquisitions are subject to approval by the Treasurer under the Foreign Acquisitions and Takeovers Act 1975 (Cth), directors should factor in time for any required approvals accordingly.