ASX to rejig corporate governance framework

The ASX is looking to modernise eight core corporate governance principles, which include rejigging executive remuneration and board composition, to make them fit-for-purpose in the current environment in which ASX-listed entities operate in.

The bourse has kicked off a public consultation on the fifth edition of its Corporate Governance Principles and Recommendations, which have been in place since 2019 and provide a high-level framework that forms the foundation of what good corporate governance looks like for ASX-listed entities.

The draft principles were developed by the ASX's Advisory Group on Corporate Governance (AGCG), which is chaired by Philip Lowe.

"The principles support the integrity and attractiveness of the ASX market by providing a recognised framework for listed entities to explain their governance arrangements to investors," Lowe said.

"They give investors a consistent basis on which to assess governance quality, while giving boards a structured reference for good governance arrangements that can evolve with the entity's size, maturity and circumstances."

The revised principles take an "if not, why not approach" to balance between transparency, accountability and flexibility and do not require every entity to adopt the same governance practices.

"Instead, it asks entities to explain their governance arrangements and, where they do not follow a recommendation, explain why and what they do instead to satisfy the high-level principle," he said.

Refinements to the principles include how entities can produce timely, balanced and accurate disclosures, better understand and manage risk, as well as remunerate fairly and responsibly.

Lowe was appointed to chair the AGCC earlier this year and includes seven other members that include former APRA executive Helen Rowell, and TelstraSuper's Dominique d'Avrincourt, along with governance professionals including Pru Bennett, Tim Paine, Peter Torre and Nicola Wakefield Evans.

The AGCG has met regularly since February 2026 and will oversee the consultation process, with the aim of delivering final recommendations to the ASX board by the end of the year.

Written submissions close on September 14, while ASX and the AGCG will conduct a national roadshow in August to gather stakeholder feedback.

"The principles only do their job if they're lived by boards, not just checked off. Companies can apply the principles in a way that reflects their circumstances, while remaining accountable to investors when they don't. Getting that balance right is what we're asking the market to test through this consultation," ASX acting group executive for listings Gavin Skene said.