ASX Advisory Group on Corporate Governance – July Meeting

Key Takeaways

• The AGCG met on 8 July 2026 to review the consultation package for the 5th edition of the ASX Corporate Governance Principles and Recommendations (the Principles).
• An eight-week public consultation involving roadshows and submissions started on 20 July 2026.
• The Group noted APRA and Treasury’s regulatory updates on governance and firm regulation.
• Stakeholders should submit feedback ahead of the next AGCG meeting on 12 October 2026.

Fourth AGCG Meeting

The AGCG met for the fourth time on 8 July 2026 and released its fourth communique on 10 July 2026. The outputs of this meeting were:

• A review of the consultation package on the proposed changes in the fifth edition of the Principles. This consultation is seeking feedback from listed entities, investors and other market stakeholders.
• A recommendation that public consultation for 8 weeks begin on 20 July 2026. It will include written submissions, stakeholder roundtables and public roadshow forums in Sydney, Brisbane, Melbourne, Adelaide and Perth.
• Recognition of market updates including APRA’s consultation on proposed changes to its governance requirements and the Treasury’s options paper on the regulation of accounting, auditing and consulting firms in Australia.

Proposed 5^th Edition of the Principles

The ASX released the proposed 5^th edition of the Principles for consultation and a consultation paper on 21 July. The primary changes from the 4^th edition are:

• Reduced the number of recommendations from 38 to 36. Recommendations that basically duplicated the requirements or obligations of other statutes (like, for example, the Corporations Act 2001) have been removed.
• As the commentary boxes tended to be prescriptive, they have been reduced to minimise the tendency for a compliance approach.
• Moved and reorganised certain recommendations to new sections.
• Expanded on Recommendation 2.2 about director skills and disclosure of the process for how the Board assesses the skills of directors.
• Shifted the focus of “Principle 3: Instil and reinforce a culture of acting lawfully, ethically and responsibly” towards the entity, rather than broader stakeholders.
• Introduced Recommendation 4.3 on disclosure of the first appointment of the external auditor and when the audit engagement was last reviewed – a timely change, given recent developments with auditors.
• Amended wording of Recommendation 8.1 from “appropriate and not excessive” to “fair and reasonable”. We note that what is considered “fair and reasonable” to some CEOs might be considered inappropriate and excessive to some investors.
• Introduced Recommendation 8.2 on Boards maintaining explicit board discretion to adjust performance-based remuneration outcomes of its senior executives downwards when appropriate.
• Introduced Recommendation 8.3 about NEDs being remunerated strictly with fixed fees (cash, service-based equity, superannuation), and disclosure of policies in relation to NED share ownership.

What does this mean for Boards, Directors, investors, and other interested parties?

Not much, yet. Anyone with something to say on the proposed changes in the 5^th edition of the Principles (and there will be many) should get their two cents in before mid-September. The AGCG will consider all feedback in October.

The AGCG will meet again on 12 October 2026. Guerdon Associates will be making its own submission and will continue to monitor and summarise these releases as they occur.

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