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ASX Takes Control of Corporate Governance

ASX

ASX Takes Control of Corporate Governance Principles

The structure of corporate governance in Australia is undergoing a fundamental change. The system for establishing the Corporate Governance Principles and Recommendations (CGPR), which guide all ASX Listed Entities, is being overhauled after 23 years.

The catalyst for this shift was the collapse of negotiations for the proposed 5th Edition of the CGPR earlier this year. The 19-member ASX Corporate Governance Council (CGC), a body designed to achieve consensus among diverse industry groups, found itself in gridlock.

This friction prompted the ASX to commission an independent “Review Panel” in June 2025 to recommend a more effective path forward.

The Six Key Recommendations Shaping the Future of CGPR

In September 2025, the Review Panel released a report with sweeping recommendations, which the ASX formally committed to adopting in October 2025. This marks a definitive transition from a broadly representative model to a more centralised and expert-driven approach.

The core recommendations are:

  1. Shift Ultimate Responsibility: The sole authority for developing, approving, and issuing the CGPR will move from the CGC to the ASX.
  2. Establish a New Expert Advisory Group: The ASX will be supported by a small, new Advisory Group of 6-10 members (half the size of the former council), led by an independent Chair.
  3. The Philosophical Shift: Members of the new Advisory Group will be appointed in their individual expert capacity. They will be expected to act in the interests of the entire market, moving away from representing specific industry groups or constituencies.
  4. Retain the “If Not, Why Not” Rule: The existing flexible disclosure approach will remain central to the Principles. This cornerstone of Australian governance gives boards flexibility while maintaining transparency.
  5. Simplify and Streamline: Future Principles will be simplified to avoid overlap with matters already covered in the Corporations Act and other legal/regulatory requirements.
  6. Set a Fixed Renewal Cycle: A 4-year renewal cycle will be implemented to ensure the CGPR remains current and can quickly address evolving risks like ESG, cyber security, and corporate culture.

What This Means for ASX Listed Entities

The ASX’s commitment to these changes signals a move toward a more agile and efficient system for maintaining world-class corporate governance standards in Australia. While the 4th Edition of the Principles remains in effect for now, boards should anticipate quicker responses to global governance trends and a renewed focus on core principles over overly prescriptive rules in the next edition.

Can We Help?

We understand the importance of good governance for Australian listed entities.  Since 2001, we have assisted listed entities strengthen their risk management framework to align with better practice and the Corporate Governance Principles and Recommendations (CGPR).

Our services are designed to help boards quickly translate the Principles into actionable compliance and disclosure practices, enabling listed entities to meet the higher standards expected.

For small to medium listed entities, we offer bespoke services that include:

  • Virtual Risk Officer: We offer expert guidance in establishing formal risk frameworks and conduct independent reviews to assess framework maturity. Additionally, we conduct risk workshops, risk culture assessments, and provide specialised services in areas like business continuity, crisis management, fraud control, modern slavery, and climate change risk.
  • Virtual Chief Information Security Officer (vCISO): We provide fractional or on-demand cyber security leadership to help you meet the evolving cyber risk landscape, without the cost of a full-time executive.
  • Internal Audit Services: We provide outsourced or co-sourced internal audit functions, ensuring independent assurance on your controls and operational efficiency, which is vital for maintaining board and stakeholder confidence.

Take risk management to the next level and contact us to discuss your risk and resilience needs.

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