Listed@ASX Compliance Update 02/26

On 9 April 2026, ASX issued Listed@ASX Compliance Update 02/26. The release clarifies expectations in relation to compliance with certain Listing Rules and provides an update on the activities of the new Advisory Group on Corporate Governance.

We discuss the topics covered and key takeaways below.

In-principle advice before draft listing applications for fast-tracked IPOs

In June 2025, ASIC launched a two-year pilot program designed to compress regulatory timetables for eligible entities seeking admission to the ASX. The trial involves:

• early engagement with ASIC in relation to pathfinder disclosure documents to identify and address issues before formal lodgement; and

  
  

• acceptance of retail investor applications during the statutory exposure period following lodgement.

To be eligible, an entity must:

• have a projected market capitalisation of at least $100m at quotation; and

  
  

• not have securities subject to ASX-imposed escrow.

The primary objective of the trial is to reduce execution risk by limiting the opportunity for market volatility to impact the IPO process once terms and pricing are finalised. If utilised successfully, eligible entities can be listed approximately two weeks after lodging the final version of their offer document with ASIC.

ASX introduced changes to Guidance Note 1 in parallel with the trial. The revised guidance provides that ASX may agree to front-end its review of listing applications by completing most of its evaluation work on pathfinder offer documents and draft Appendix 1As (rather than final versions).

ASX has reiterated its support for the program but reminded market participants that waivers and confirmations required in connection with listing applications should be obtained before the fast-track process commences. For certainty, ASX has suggested that requests for in-principle advice be made at least four weeks before applicants intend to submit their draft Appendix 1As.

For ASX aspirants and their advisers, this means:

• matters requiring in-principle advice (for example, waivers in respect of securities convertible into shares for nil cash consideration) must be identified and raised with ASX as early as practicable; and

• failure to account for early engagement with ASX may result in reversion to the standard Appendix 1A review period of four to six weeks.

No waiver necessary to exercise specific discretion under an ESIP

Listing Rule 6.23 governs changes affecting options and rights convertible into fully paid ordinary securities, including performance rights. Pursuant to Listing Rule 6.23.3, listed entities cannot reduce the exercise price of options or rights, increase the period during which options or rights are exercisable or increase the number of securities into which options or rights convert.

ASX has recognised that the application of Listing Rule 6.23, particularly in relation to employee incentive schemes, can be difficult in practice. A number of listed entities have approached ASX for a waiver of Listing Rule 6.23 in respect of securities issued under employee incentive schemes in circumstances where no waiver is required.

ASX has confirmed that an entity does not require a waiver of Listing Rule 6.23.3 to exercise a specific discretion under its employee incentive scheme (or the terms of an individual grant under its scheme). For example, it is common for options and rights issued under employee incentive schemes to be non-transferable, except with the prior written consent of the relevant entity, which consent the entity may give or withhold at its absolute discretion (subject to applicable laws). The clarification provided by ASX indicates that an entity may consent to a transfer in these circumstances without a waiver of Listing Rule 6.23.3.

No waiver of Listing Rule 6.23 will be required in certain other defined circumstances. For example, if the terms of options or rights issued under an employee incentive scheme provide that a pro-rata entitlement offer completed while the securities are outstanding will result in a proportionate increase in the number of shares into which they are exercisable, the increase would not be contrary to Listing Rule 6.23.3. Similarly, if the terms on which options or rights are issued to an employee allow the relevant entity to claw-back securities in the event that the employment is terminated, the entity will not need a waiver to do so.

Conversely, the exercise of a general discretion to amend or waive the terms or conditions of options or rights, or to amend the rules of an employee incentive plan, will constitute a change prohibited under Listing Rule 6.23 (without an appropriate waiver or shareholder approval, as the context requires).

For listed entities seeking to remunerate officers, employees and service providers with securities on flexible terms, the key takeaways are as follows:

• well-drafted employee incentive plans which clearly articulate discretions and adjustment events can reduce the need for ASX engagement;

  
  

• existing employee incentive plans should be reviewed to ensure that discretions intended to be exercised without a waiver of Listing Rule 6.23 are sufficiently specific; and

• relying on vague amendment powers will still require shareholder approval or ASX engagement.

Refer to Listed@ASX Compliance Update 09/23 for more detail on how Listing Rule 6.23.3 applies to changes affecting options and rights.

Update on the new Advisory Group on Corporate Governance

ASX established an Advisory Group on Corporate Governance (AGCG) in January 2026. The AGCG replaces the ASX Corporate Governance Council (Council), which was responsible for providing listed entities with insights and guidance in relation to governance.

Each year, entities are required to disclose the extent to which they follow a set of corporate governance principles and recommendations released by the Council in 2019 on an ‘if not, why not’ basis. The Council published four editions of the principles and recommendations and was working on a fifth before it was dissolved. Responsibility for updating the principles and recommendations has been assumed by the AGCG, which aims to provide ASX with a list of recommended revisions by the end of 2026.

ASX has advised that the AGCG has met twice since it was established and confirmed that a public statement summarising the business transacted by the AGCG will be released after each meeting. The first two summaries are now available on the ASX website.

Public consultation on draft updates to the principles and recommendations is expected in Q3 2026, with AGCG suggestions to follow by year-end. Listed entities can anticipate a simplified approach to governance under the new regime. The AGCG has explained that its focus is on providing guidance that is helpful to listed entities without creating additional compliance obligations.

Continuous disclosure amid geopolitical uncertainty

Conflict in the Middle East is impacting supply chains and creating other economic challenges across a variety of sectors. ASX has acknowledged that unstable macroeconomic conditions and rapid geopolitical developments give rise to disclosure issues for listed entities.

Listing Rule 3.1 provides that listed entities must immediately disclose any information that a reasonable person would expect to materially affect the price or value of their securities. This requirement does not apply if (among other things) the information in question comprises matters of supposition or is insufficiently definite to warrant disclosure.

ASX has confirmed that continuous disclosure obligations do not require entities to predict the unpredictable (or to announce such predictions to the market). Public information about events affecting all entities in a sector typically will not trigger Listing Rule 3.1. For example, the risk of fuel shortages applies generally across the transport, agriculture, resources and construction sectors and (subject to the below) is not required to be disclosed.

However, ASX has emphasised the distinction between events impacting the market (or a sector) generally and those which have entity-specific consequences. If an entity makes price-sensitive operational changes in response to conflict in the Middle East, disclosure will be required. Earnings guidance which has become materially inaccurate as a result of market-wide conditions must be updated or withdrawn. Similarly, listed entities should abstain from making forward-looking statements unless they have a clear and reasonable basis for doing so. Listing Rule 3.1B empowers ASX to require corrective disclosure in circumstances where public information (such as guidance) has misled (or is likely to mislead) investors.

To ensure that continuous disclosure practices align with ASX requirements, listed entities should:

• reassess guidance to determine whether it should be updated or withdrawn;

• carefully consider whether operational changes made in response to global events are price-sensitive; and

  
  

• clearly identify reasonable bases for forward-looking information before disclosure.

Questions

If you have any queries in relation to the updates outlined above or would like to discuss further, please do not hesitate to contact us.

Author

Will Brehaut

Solicitor

will@palisadecorporate.com.au

+61 466 224 838

Important notice

This publication is general in nature and has been prepared for reference purposes only. Its content is current at the date of publication. It does not constitute legal advice and should not be relied upon as such. Specific legal advice about your particular circumstances should always be sought separately before taking any action based on this publication.