2019 CEO Survey: Dominic Stevens, ASX

The Hayne royal commission has profoundly changed doing business in Australia, says ASX CEO Dominic Stevens.

Dominic Stevens, the ASX CEO. Britta Campion / The Australian.

Every year The Australian’s John Durie asks some of the biggest names in Australian business five key questions about what’s coming in the year ahead.

READ MORE: John Durie’s 2019 CEO Survey.

How is your company affected by low-interest rates and what is needed to boost the economy?

Low-interest rates are not a material threat to ASX’s business, and they may have run their course. Time will tell. The possibility of negative interest rates would put our economy in unchartered territory, and that’s rarely desirable for any business. Nevertheless, ASX has conducted extensive testing with our customers to ensure the continued robustness of systems should interest rates fall to, or drop below, zero.

What is the impact of government regulations on your company, including those applying to the financial sector?

We live in a different world following the Hayne royal commission, which has had lessons for all businesses. It is not surprising there has been a strong regulatory response since. ASX already operates in a highly regulated environment and has open and constructive relations with our regulators. We expect the regulatory bar to continue to be raised for ASX and others that are critical to the proper functioning of the market. That’s appropriate. However, business wants certainty, a level playing field and a measured response. Consultation and collaboration with industry will be important too.

What percentage of company revenues are spent on research and development, and how is your company using technology to improve performance?

ASX’s capital expenditure investment spend is currently $75-80m per annum, around 10 per cent of our revenues. Technology is vital to our activities. Not just for improving our own performance – reliability, functionality, scalability, resilience, etc – but also for our customers, helping them and the market more generally reduce costs and complexity, and stimulate innovation. ASX is investing substantially in people and technology for the digital economy, from the use of distributed ledger technology, through to our DataSphere initiative, exploration of AI and state-of-the-art Australian Liquidity Centre.

What are the three major policy issues facing the country and what should be done about them?

● A clear and sustainable energy policy, which addresses climate change and includes a significant role for renewables.

● A commitment to stimulate innovation across industries and beyond single budget cycles, backed with real incentives.

● A renewed approach to all tiers of education, which is national in scope, more equitable, and adequately funded. There are fewer things more critical and empowering for a nation than the educating of its citizens.

What are the major impediments to long-term growth facing your company, and what can or is being done about them?

Two things: the first being a challenge rather than an impediment, is regulatory change and uncertainty. The second is the change program in which ASX is trying to deliver a better infrastructure to enable the financial markets industry to reduce costs and increase efficiency. However, rolling out this technology needs a significant commitment from industry to help manage that changeover. We will continue to work with our customers to make the change program as efficient as possible for them, in the interests of realising benefits for all.