ASIC urges discipline on rumour mill
A senior Australian Securities and Investments Commission (ASIC) officer has warned the managements of publicly-listed companies to become more disciplined in establishing information barriers around price-sensitive information.
ASIC commissioner Belinda Gibson told the Australian Investor Relations Association that publicly-listed companies should rigorously apply the ‘disclose only to those who need to know’ rule if they want to stop the flow of information that was capable of fuelling market rumours.
Gibson said this was a proposition ASIC intended to take up with the market in 2009 in circumstances where news was spreading very quickly in the current climate and affecting market prices.
“Companies that are aware of impending news and juggling when to disclose it must be very alert to a leak and must advise the market immediately,” she said.
Gibson also made clear that when dealing with rumours companies and their advisers could not engage in selective disclosure of material information.
“It is not enough for you to call your major institutional desks, or the journalists, to set the story right, and rely on them to spread the word,” she said. “That is just war by ‘counter rumour’. If the information is price sensitive then everyone must be told it, through the Australian Securities Exchange platform.”
AUTHOR
Mike Taylor
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