Check against delivery

Thank you all for coming to our second Financial Markets and Innovation Roundtable.

I'm going to offer some reflections on where things stand and what we've heard since we last met in June. I did not expect to be discussing these issues as often as I have, across engagements, parliamentary hearings, and boardroom tables.

Thank you for giving us your time and expertise. It's a significant commitment. A number of you were around the table in June and we're grateful that you have returned.

We have representatives from a diverse group of sectors, and no doubt a range of perspectives, which we are keen to hear.

From ASIC’s perspective, we want to spend most of this morning listening to you. We hope today's discussion will be practical and give us tangible takeaways.

When we first met in June, we identified areas of opportunity and focus for Australian markets.

Today, we want to consider the solutions, actions and next steps, whether for ASIC, policymakers, or industry. We want to focus on problems that, if solved, would improve outcomes for investors, businesses and Australians. In June, we heard a strong and consistent message: our financial markets are changing quickly and the choices we make now will shape their strength and relevance over the next decade.

Technology is a significant part of that change. It is changing how our markets operate. Public and private markets are evolving. Capital is increasingly mobile, and our markets are becoming more and more interconnected and dependent on critical infrastructure.

If anything, that message has become more urgent over the past few months.

Since then, we have continued to engage with many of you and your colleagues across the market.

We have done that through our regular engagement panels and targeted discussions with individual market participants and industry bodies.

Those discussions have included deep dives with many of you on collateral mobility, repo markets, settlement efficiency, equity market liquidity and capital formation.

I will outline what we understand to be the key takeaways from those engagements.

This is intended to set the scene for today’s discussion.

So first, on access.

Here we are talking about access to markets, liquidity and capital-raising pathways.

Since June, renewed listing activity and public debate around major transactions have sharpened the focus on market depth, liquidity, access to growth capital, and Australia’s attractiveness as a place to raise capital and invest.

We have continued to hear about the changing relationship between public and private markets.

Participants have pointed to the opportunities created by growing pools of private capital, while emphasising the continuing importance of strong public markets for price discovery, transparency, participation and capital formation.

The contest for capital is intensifying for a range of reasons. The practical question is how we keep Australian markets attractive, accessible and relevant, while supporting liquidity and retail participation and giving companies of all sizes effective pathways to raise capital across both public and private markets.

The second theme is that of efficiency, and the role that innovation can play in improving it.

When we met in June, much of the discussion focused on the potential of AI and digital market infrastructure.

Since then, the focus appears to have shifted from future possibilities to practical applications, including how technology can reduce friction and support more efficient and resilient markets that continue to meet the needs of investors and businesses.

We also heard a lot in June about useful innovation. As several people put it, we do not want innovation for innovation's sake. We want innovation that creates efficiencies. We need to prioritise changes that lift productivity, reduce friction, widen access, strengthen risk management and ultimately improve the strength of our financial system.

Innovation is not a separate conversation today. It runs through the other themes of access, efficiency and resilience.

Turning then to resilience.

The more we have discussed innovation, efficiency and what markets need to remain relevant, the more resilience has moved to the centre of the conversation.

Stakeholders continue to highlight operational resilience, cyber preparedness, infrastructure dependencies and concentration risk as key areas of focus.

As markets become more interconnected, fragmented and technology-dependent, and the strategic risk environment becomes more complex, continued competitiveness depends on strong foundations.

Resilience does not sit apart from innovation, competitiveness and growth. It enables them. Innovation depends on trust, and change depends on resilient infrastructure.

Addressing these interconnected issues is important if Australia is to remain an accessible, efficient, resilient and globally relevant market.

This is what we are here to discuss today.

Where to from here?

We have identified six areas of focus that respond to the themes of access, efficiency and resilience:

• Liquidity and access for retail investors
• Supporting the pipeline of emerging and innovative companies in Australia
• Enabling collateral mobility and interoperability by reducing friction
• Aligning settlement windows to enhance post trade efficiency
• Critical market infrastructure and resilience
• Transparency in valuation and margining to monitor channels for systemic risk

It is a substantial and complex list. We will not resolve all these issues today. But by the end of the session, we hope to have a short list of practical actions that could make a meaningful difference over the next six to 18 months, and a clearer view of who should lead them. That will give us a path forward.

Maintaining and improving our financial system, and promoting confident participation by investors and consumers, are at the heart of ASIC’s statutory objectives.

Regulation is important, but it is only one part of the picture. We are open to ideas about how ASIC can support Australia's markets. We don't want to add regulation unnecessarily. We want to ensure the regulation we have does not unnecessarily stifle growth or productivity.

If our regulatory setting can be improved, we want to hear your ideas. We are committed to continuing to bring together voices like yours to help move practical action forward.

As I said earlier, the solutions may lie with ASIC, industry, or policymakers. It is helpful to have Treasury in the room as well.

Before turning to you, it is important not to lose sight of why we are here.

Effective capital markets support economic growth. They have long helped to incubate new businesses, support new technologies and underpin Australia’s economic success.

We are starting from a strong base. We have growing debt markets and a superannuation sector worth more than $4 trillion. Ensuring the settings are right for capital markets to flourish will be essential to funding Australia's future.

With that, I will finish setting the scene and turn to the perspectives around the table.