This is a service specifically targeted at the needs of busy non-executive directors. 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 consider ASIC’s market integrity update, Treasury’s proposal to review the operation of recent FIRB reforms, proposed changes to Australia’s continuous disclosure laws and changes to director resignations, and consider key takeaways from the recent earnings season.
GOVERNANCE & REGULATION
ASIC issues its February 2021 Market Integrity Update. Market Integrity Update
Treasury announces an evaluation of the foreign investment reforms that commenced on 1 January 2021. Treasury review page Terms of Reference
LEGAL
Proposed changes to Australia’s continuous disclosure laws. Treasury Laws Amendment (2021 Measures No. 1) Bill article media release
Amendments to the Corporations Act regarding director resignations take effect. Corporations Act
OVER THE HORIZON
Earnings season reflects Australia’s recovery from COVID-19. Shareholders can expect solid dividend earnings from across corporate Australia, including mining, thanks to a strong iron ore price, banking, retail and healthcare. Overall it appears companies have benefited from the government stimulus aimed at keeping Australians in jobs, coupled with low interest rates. With companies flush with cash, we expect the drive to raise capital in 2020 to give way to more M&A activity in 2021. However, we also expect to see more definitive forward earnings guidance to emerge following the COVID-19 induced hiatus, and there is the potential for this to disappoint if market expectations have over-shot reality. We note that, notwithstanding robust financial performance, several larger corporates have continued to indicate the “outlook is uncertain” in light of the anticipated withdrawal of Government stimulus and the transition to a “new normal” global economy in the aftermath of the virus.