14 questions asked at 2022 ASX AGM

September 30, 2022

Here is the text of the 14 written online questions asked by Stephen Mayne at the 2022 ASX AGM held on September 28. Moderator Matthew Gibbs never disclosed who was asking the questions but he read all of them out with only the odd edit. Here is the web page with access to both the transcript and AGM webcast.

1. Did any of the 5 main proxy advisers - ACSI, Ownership Matters, Glass Lewis, ISS and ASA - recommend a vote against any of today's resolutions? Has their been a material proxy protest vote against any of today's resolutions? Why didn't you disclose the proxy position on your own platform with the formal addresses as several other companies now do? Will you disclose the proxy votes before the debate on today's resolutions so shareholders can ask questions about the reasons if there have been any protest votes?

2. What is the latest situation with the ISX litigation? Is it correct we've spent $9 million on legal fees so far? What are our prospects of recovering these costs and have we ever been sued before by an issuer objecting to being suspended. What lessons have we learnt from the ISX saga. Should we have been stronger on prevention earlier and were we ever tempted to fold at let trading in the stock resume? What about the 10,000 retail shareholders who have lost everything? Have we been fair to them?

3. A question for Voula the auditor: What has been the auditor's involvement in the CHESS project and the timing of various announcements about cost and time over-runs. How much of the $260m spent so far has been capitalised and how much has been expensed. If the ASX board decided to walk away from the whole project as a big mistake, what sort of write-down would shareholders be facing?

4. Regulatory risk is ever-present with ASX given that we are an effective monopoly which has enormous profit margins making a $509m net profit in 2021-22 on revenue of just over $1 billion. Could Heather please comment on her connections in Canberra that might be useful in terms of discouraging the Albanese Government from doing anything that might undermine our monopoly profits.

5. Given the unprecedented cost of living pressure in Australia, is it appropriate for ASX to charge higher fees for traders of electricity futures than traditional cash futures. How do we justify having higher fees for different asset classes? Shouldn't all traders of futures pay the same price and exactly how much revenue are we making from electricity futures trading?

6. In 2021-22, ASX paid $120,000 each to be a platinum member of the Business Forum/Network of the Federal Liberal Party and Federal Labor Party. This is disclosed and explained on p42 of the Annual report but is inappropriate, particularly given the incoming National Anti-Corruption Commission. Powerful corporate monopolies should not be making six-figure annual payments to political parties, buying access and influence. What does Melinda Conrad and the new CEO thing about the appropriateness of this?

7. Could David Curran please comment on why ASX insists on having its AGM so early in the cycle, making it one of the only companies that releases its full year results after the deadline for board nominations close. It's standard governance that investors be informed about the performance of an entity before closing off board nominations. The full year results were released on August 18, but the deadline for board nominations was August 2. Will David Curran agree to either a later AGM or earlier results release next year?

8. When disclosing the outcome of voting on all resolutions today, including this re-election of Peter Nash, could you please advise the ASX how many shareholders voted for and against each item, similar to what happens with a scheme of arrangement? This will provide a better gauge of retail shareholder sentiment on all resolutions and was a disclosure initiative adopted by the likes of Metcash, Altium and Dexus after their 2021 AGMs. Will Peter Nash support such a disclosure initiative?

9. Could Heather Smith please comment on which of the existing ASX directors she knew, either personally or professionally, before being invited to join the board. What was the recruitment process? Was an external headhunter involved with a short list and a long list. How many candidates did the chair meet and how many did the full board interview. What did Heather think of the recruitment process?

10. What is the actual plan in terms of increases in board fees, if this resolution is approved and when was the last increase? Given that the CEO's STI was cut by 30% due to the CHESS blowouts, why is the board asking for a pay increase at this time? Shouldn't the directors most deeply involved in the CHESS process also have their pay clipped? Who on the board has been held to account for the CHESS fiasco?

11. Given the interesting discussions today, including on this LTI grant, could the chair undertake to repeat his excellent initiative after last year's AGM by publishing a full transcript of today's discussion on the ASX website, along with a full archive of the well-produced webcast. Thanks also for asking all submitted online questions today without editing or censorship. This is best practice & something not all companies do. I was also impressed with Helen's performance at her first earnings call & support this LTI grant.

12. Why was there a 9.3% protest vote against Peter Nash today. Was it CHESS or remuneration related and which of the proxy advisers delivered the against recommendation?

13. What triggered the 30% protest vote and first strike. Was it only Dominic's bonuses after CHESS failures? Is this the first time ASX has suffered a strike and what changes will you make as a result of this. Which proxy advisers, not shareholders, recommended against. ASA is public with their against recommendations and other proxy advisers don't mind their positions being made public at AGMs.

14. A question for Ken Henry as he departs the board. Could Ken please comment on his personal reflections about the CHESS project. We've spent $260m and still don't have any certainty about whether it will ever be scalable and suitably reliable. As a long serving director, what has been the board's journey in terms of overseeing the project and being accountable for the time and cost blowouts? Who on the board has been held accountable. Could the chair also comment.