Advancing Australia's evolving capital markets: what ASIC's Report 823 means for issuers, investors and intermediaries

The Australian Securities and Investments Commission (ASIC) released Report 823 ‘Advancing Australia’s evolving capital markets: Discussion paper response report’ (Report) on 5 November 2025, following submissions on its discussion paper on Australia's evolving capital markets. The Report sets out ASIC’s near-term roadmap to strengthen private and public markets in Australia.  

ASIC's core message is that Australia needs vibrant capital markets supported by better data, cleaner conduct (whereby markets operate with the highest level of integrity and adherence to regulations), and modernised settings that attract global capital whilst protecting investors. In light of the Report, issuers, investors and intermediaries should expect ASIC’s increased supervision and surveillance of private markets, updated guidance, targeted enforcement, and openness to innovation where it enhances integrity.

Five key takeaways

1. Private credit has grown quickly – and variably. ASIC has seen wide variance in practices across the sector and limited stress testing.  ASIC’s surveillance will intensify, focusing on distribution, fees, conflicts and reporting.
    
2. Data gaps are now a regulatory priority. ASIC will push for recurrent, consistent private-market data to supervise risks effectively.
    
3. Superannuation's scale magnifies system effects. ASIC will continue to include superannuation trustees in their surveillance of market cleanliness, financial reporting and audits, and investment disclosures, including their work in the platforms segment.
    
4. Public markets must modernise. ASIC will support targeted listing and initial public offerings (IPO) reforms whilst monitoring market cleanliness.
    
5. Bond markets matter. ASIC supports reforms to deepen the retail corporate bond market and improve wholesale market cleanliness – a critical gap given private credit's rapid expansion.

Private markets: rapid growth demands higher standards

Preqin, a leading provider of financial data in the alternative assets industry, estimates Australian-focused private market assets under management (AUM) grew over 140% to $167 billion over the past decade. The Report reveals the private credit market expanded over 500% from $35 billion in 2015 to $213 billion at end-2024. 

However, ASIC's surveillance found the sector relatively immature and untested in stress scenarios, lacking consistent practices in governance, transparency, fees, valuations and conflicts management.  Some failings raise compliance questions, including the obligation to provide services efficiently, honestly and fairly. ASIC’s view is that over-concentration in real estate at the expense of enterprise growth, particularly for SMEs, poses real risks.

In order to support confident and informed participation, investor protection and market integrity, ASIC expects industry participants to benchmark against defined principles to lift practices and enhance standards. These principles are:

• Stewards of other people’s money. Responsible entities of retail funds (REs) and trustees act as stewards of investor capital, ensuring that their decisions are fair and in investors’ best interests.
   
• Organisational capability. Human, financial and technological resources are adequate. REs and trustees operate efficiently, honestly and fairly.
   
• Transparency. Investors have access to timely, transparent information on investment strategy, exposures, valuations, risks and fees.
   
• Design and distribution. Design and distribution practices are fair, transparent and appropriately targeted for investors.
   
• Fees and costs. Fees and costs are fair and transparent, giving investors and borrowers a clear view of total costs.
   
• Conflicts of interest: Conflicts of interest are identified, disclosed and effectively managed or avoided.
   
• Governance. Structures, processes and people promote sound decision-making, compliance and accountability.
   
• Valuations. Valuations are fair, timely and transparent, with robust governance.
   
• Liquidity. Liquidity risk is effectively disclosed and managed, avoiding structural mismatches, with fair redemption terms aligned to portfolio liquidity.
   
• Credit risk. Credit risk is effectively managed across loan origination, portfolio construction, monitoring, impairment, default and repayment.

Key initiatives: 

• ASIC will conduct targeted surveillances of funds management, including private credit funds with real estate strategies, focusing on distribution, fees, margins and conflicts.
   
• ASIC has also confirmed that Regulatory Guide 181 ‘Licensing: Managing conflicts of interest’ will be updated by the end of this year.
   
• ASIC will release a catalogue summarising fund managers’ legal obligations and related ASIC regulatory guidance.
   
• ASIC will engage with the Federal Government on policy and potential legislative reform for wholesale fund managers and the “wholesale client” definition, and engage with industry bodies on their work to lift private credit sector practices – particularly in relation to the ten principles above. 

Data transparency: a critical gap

ASIC has noted it is lagging behind its international peers in that it lacks access to the data needed to enable it to supervise private capital funds. By way of example, ASIC stated it does not know which wholesale funds are being operated by the approximately 1,900 licensed wholesale fund operators and in order to identify which funds exist (and their core features and activities), it has to contact fund operators. ASIC views this as an inefficient, reactive approach which is leaving risks unchecked.

Key initiatives: 

• ASIC’s objective is to ensure data collection is proportionate, targeted, fit for purpose and consistent with a ‘collect once’ principle across government.  
   
• ASIC will pilot enhanced data reporting in 2026-27 from a small sample of the funds management sector, including to inform reform options (such as a recurrent data collection power for ASIC and improved data sharing between government bodies).

Superannuation: systemic importance and private market exposure

The scale of Australian superannuation, both domestically and overseas, has shifted regulatory attention towards its role in stress situations. As at June 2025, total superannuation AUM reached $4.3 trillion, around 160% of GDP. The largest APRA-regulated funds hold between 20% and 30% in unlisted assets, including infrastructure, property, private equity and private credit.

The RBA notes whilst superannuation has historically supported the financial system, its size means it may amplify financial market stress in severe scenarios. Recent high-profile failures in private market products exposed weaknesses in superannuation trustee protections. Given the significance of superannuation, ASIC and APRA have critical roles to play in regulation, supervision and monitoring. 

Key initiatives: 

• ASIC will continue supervision of market conduct, cleanliness and financial reporting of superannuation trustees.
   
• ASIC will review portfolio holding disclosures and the treatment of stamp duty in Regulatory Guide 97 ‘Disclosing fees and costs in PDSs and periodic statements’, to remove distortions to investment decision-making.
   
• ASIC will conduct a thematic review of trustee actions to disrupt high-risk superannuation switching, working with APRA to jointly supervise platform superannuation trustees.

Public markets: modernisation and innovation

Public markets are foundational to Australia’s economy. Public financial market infrastructure provided in a stable, resilient and reliable manner is essential for maintaining trust and confidence in public markets. IPO activity in 2025 was subdued compared to historical averages, with 31 listings year-to-date. Evidence shows regulation isn't the primary driver of declining listings – the main drivers are changing company needs and plentiful private capital access. Nonetheless, some view regulation as having cumulative effects amplified by public scrutiny.

Key initiatives: 

• ASIC will continue its ongoing two-year trial where entities listing on the ASX via the fast-track process have access to a shorter IPO timetable.
   
• ASIC is reviewing Regulatory Guide 254 ‘Offering securities under a disclosure document’ and is considering a class instrument to address pre-prospectus publicity issues, with an update expected this financial year.
   
• ASIC will also review guidance in Regulatory Guide 228 ‘Prospectuses: Effective disclosure for retail investors’ in the next financial year to assess its effectiveness, consider global developments, and determine whether mining-related prospectuses could be more concise.
   
• ASIC is undertaking an inquiry into the ASX, focusing on governance, capability and risk management frameworks.
   
• ASIC will continue to engage with industry, clarifying guidance as to when a forecast is required and confirming flexibility in how they can be presented, including their duration and use of meaningful ranges.

The corporate bond market gap: a funding alternative underdeveloped

Whilst private credit has flourished, Australia's listed corporate bond market remains underdeveloped.

Retail market: Only six corporate bonds are accessible to retail investors on ASX. Listed bonds have market capitalisation under $1 billion and are held by fewer than 5,000 investors – less than 0.1% of the estimated $1 trillion in corporate bonds issued by Australian companies.

A more developed corporate bond market could provide alternative funding for businesses, reducing reliance on private credit and bank lending whilst offering investors transparent, liquid opportunities.  ASIC agrees that creating a deep, liquid listed corporate bond market will benefit both companies and investors. 

Wholesale market: The Council of Financial Regulators (CFR) favours industry-led solutions for central clearing, transparency and settlement improvements. The CFR, of which ASIC is a member, has previously agreed that the introduction of central clearing of bonds and repurchase agreements (repos) in Australia could enhance the efficiency and stability of those markets. The CFR supported the industry exploring the introduction of central clearing in the Australian bond and repo markets where the benefits are likely to outweigh the costs, but did not consider there to be a compelling case for regulatory intervention to introduce central clearing in these markets at this time. ASIC is continuing to explore market cleanliness measures for government and semi-government bond trading.

Key initiatives: 

• ASIC remains focused on the ‘cleanliness’ of wholesale bond markets to support market integrity, trust and confidence.
   
• ASIC welcomes engagement with industry on this issue, including mechanisms for identifying potential misconduct and input on the evolution of its market cleanliness work.
   
• ASIC considers legislative reform is needed to drive meaningful change and has noted it will support this process, including contributing to transparency and disclosure settings.

Implications for Debt Capital Markets participants

The Report reinforces ASIC’s focus on market cleanliness and Debt Capital Markets (DCM) participants should expect enhanced focus and surveillance on allocation practices, material non-public information controls and transparency in wholesale bond issuances – particularly in relation to the ten private-sector principles discussed above. Market participants should also ensure robust, documented policies for conflicts of interest and confidential information handling.  

ASIC's support for retail bond market reform signals potential future opportunities, though meaningful change requires government action. Stakeholders should be on the lookout for opportunities to contribute to ASIC’s collaborative law reform efforts through future discussion papers and consultations.  With private credit facing scrutiny and concentration risks, a well-developed corporate bond market offers a transparent, liquid alternative.

Implications for Equity Capital Markets participants

ASIC's commitment to make public listings more attractive for companies is welcomed and will present opportunities for Equity Capital Market (ECM) participants.  ASIC will continue the two-year trial enabling entities listing on the ASX via the fast-track process to access shorter IPO timetables, and continue to make targeted regulatory adjustments for IPOs. 

Over the next 12-18 months, boards and issuers can expect reforms to pre-prospectus publicity rules and to reduced forecast and disclosure requirements in prospectuses, as well as tailored pathways for smaller cap and growth entities, and a move towards stepping away from the one size fits all approach to IPOs. 

Simultaneously, ECM participants can expect ASIC to explore changes to other regimes that will strengthen the attractiveness of public listings, including easing post-IPO regulatory requirements, revisiting thresholds for foreign exempt listings and streamlining policy on dual listings. This is balanced by ASIC’s plan to increase data collection and transparency which may impose new reporting requirements on ECM participants.

ASIC has acknowledged there is uncertainty around overlapping liability regimes affecting disclosure obligations. Many of ASIC’s initiatives are yet to go through consultation, will be subject to cooperation with other financial regulatory and government bodies, and require legislative amendments to be implemented. 

Looking ahead 

The Report reflects a directional reset rather than a wholesale overhaul of ASIC’s policies and procedures. ASIC aims to lift private market standards, modernise public markets, close data gaps, and support deeper, broader and more liquid bond markets. Market participants should expect heightened scrutiny over the next 12-18 months, particularly on private credit compliance, superannuation governance, public market resilience and bond market cleanliness.