Peter Coleman, chairman of one of the world’s largest lithium miners and former chief executive of Woodside, says short selling shouldn’t be banned because it tests businesses and lets stronger ones thrive.

“I think short-selling makes a transparent market ... I think that’s just the market working,” said Mr Coleman, who will become chairman of Arcadium Lithium after New York-listed Livent sealed a $9.7 billion merger with ASX-listed Allkem, formerly Orocobre Limited, this week.