Is insider trading going on in Canberra?
While federal ministers are prevented from owning shares, it’s a free for all for people with connections and influence with ministers, raising questions about whether non-public information is being used in share trading.
Sean Johnson18 July 2024
There are good reasons why ministers are not allowed to have shares or other interests in listed and private companies.
The Albanese Government’s ministerial code of conduct doesn’t quite spell it out, but a ban is a necessary because ministers make decisions, either jointly or individually, that can materially impact companies based in Australia or with substantial operations here.
Think new legislation and regulations, grants and subsidies, contracts, licences, permits, tax concessions, PBS listings, foreign investment approvals, and whether to hold inquiries into corporate misconduct. We could go on.
And ministers have access to non-public information about impending decisions, enforcement actions, and economic statistics that can affect company share prices.
It would be an unmanageable conflict of interest if ministers, with all their powers and inside knowledge, could own and trade shares in companies. This is why Howard government minister and secret share trader Santo Santoro had to walk the plank in 2007 (the then ministerial code banned trading but allowed holdings where they didn't conflict with portfolio responsibilities).