April 2 (Reuters) – Australia’s corporate regulator on Thursday said the country’s stock market operator ASX had prioritised delivering higher shareholder returns over ensuring strong and critical market infrastructure was in place.
The Australian Securities and Investments Commission’s final report, following a 10-month inquiry, follows several mistakes by the exchange operator over the last few years that frustrated market participants, as well as the regulator and the country’s central bank.
ASX shares were trading 2.5% higher on Thursday, while the S&P/ASX200 index was up 0.4%.
The report said ASX’s governance arrangements had failed to provide the necessary focus on its market infrastructure and the ASX had lacked aspiration to be a “steward of critical market infrastructure”.
“The Panel’s Final Report, like its Interim Report, is tough reading,” ASX Chair David Clarke said in a statement.
“It provides a critical lens on where ASX has fallen short and why fundamental changes are required.”
ASX’s risk management and compliance practices needed to mature and become more deeply embedded within business processes, the panel added.
“The further evidence and key observations in this Final Report support the scale of transformational change required at ASX to deliver on its stewardship of critical market infrastructure,” ASIC Chair Joe Longo said.
“This report confirms that ASIC’s decision to commission this unprecedented Inquiry was the right call.”
In a separate exchange filing, ASX it expected 2026 financial year expense growth of 13%–15%, excluding ASIC inquiry costs.
ASX said it would also provide a 2028 capital expenditure forecast and 2027 total expense outlook by the end of this financial year.
ASX mishaps in recent years included a series of technical glitches that resulted in a near full-day outage in the heightened trading volume of 2020, sparking an ASIC probe at the time.
The company’s ambitious, and ultimately failed attempt to rebuild its clearing and settlement software platform with custom blockchain-like technology from 2017 also frustrated market participants – and ultimately ASIC and RBA.
ASX also had a series of operational issues, including a company name mix-up in August 2025 and an outage of its announcements platform in early December last year.
(Reporting by Rajasik Mukherjee in Bengaluru and Scott Murdoch in Sydney; Editing by Shreya Biswas, Leroy Leo and Lincoln Feast)
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