World’s Worst-Performing Exchange Turns to Outsider to Lead Turnaround
Synopsis
ASX has appointed an external executive to lead the exchange operator as it seeks to rebuild trust with regulators and investors following years of operational setbacks and market underperformance.
Anthony Attia begins as ASX Ltd. chief executive on September 1, as the Australian stock exchange looks to restore faith from regulators and investors after years of boardroom woes, tech failures and share price struggles.
Attia replaces Helen Lofthouse, who left the group in May amid greater regulatory scrutiny and investor concerns over soaring technology costs.
Regulatory Challenges Remain
The change in leadership follows ASX settling legal action with the Australian Securities and Investments Commission (ASIC) in June related to misleading comments about the status of its CHESS replacement project.
A joint review conducted by the Aussie regulator ASIC alongside the Reserve Bank of Australia (RBA) flagged inadequate governance and risk management at the exchange, adding that they “could have serious repercussions for Australia’s financial system”. Since then, ASX has had several governance changes and continued with work on its Accelerate transformation program.
Focus on CHESS Upgrade
Replacing the CHESS clearing and settlement platform will be one of Attia’s key tasks.
Phase 1 of the upgrade went live in April, nearly four years after the project was laid out. Full completion is now expected sometime around 2029. There have been failed past attempts to modernise the system while technical challenges, significant budget overruns and project delays had plagued previous efforts.
Rising Costs Pressure Investors
ASX raises cost outlook for two further financial years as investment into the new technology continues, prompting earnings downgrades from a few brokers.
ASX is the worst-performing listed exchange operator in the world with shares plunging by greater than 30% over the past 5 years. The exchange has further lowered its dividend payout ratio to 75–85% of underlying net income from the previous target range of 80–90% as it needs to improve capital ratios.
Experienced Exchange Executive Takes Charge
Attia has nearly three decades of experience in global exchange and market infrastructure businesses, most recently serving as a senior executive at Euronext and Intercontinental Exchange.
His salary package reads A$6.3 million, to cover lost bonuses from his last employer, plus other performance-based incentives.
Source: Financial Post
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