We need to talk about private markets

In the last decade, private markets have boomed. Global private capital assets under management (AUM) have tripled to US$14.6 trillion, whilst Australia-focused AUM have risen nearly threefold to A$148.6 billion, thus fuelling change in the dynamic between public and private markets.

Australia’s historically small private markets are becoming an increasingly important source of capital. At the same time, we have seen fewer public market listing – and ASIC has questions to ensure Australian capital markets are well-equipped to meet current and future economic needs.

What’s behind this rapid growth and how should new or amplified risks be addressed?

Why are public markets changing and what are the implications for the Australian economy?

How is the growing significance of superannuation funds influencing our markets?

Where can we adjust our regulatory approach to improve the attractiveness and accessibility of our markets while protecting against risks?

These questions need to be explored and are not for ASIC to answer alone. It’s why this week we’ve released a discussion paper on the opportunities and risks emerging in public and private capital markets, calling for feedback and debate on key questions.

To be clear, Australia needs both public and private markets. And we need them to be strong and well-functioning.

It’s important as the corporate and markets regulator that we ask these questions. We can’t be complacent about the future of Australia’s capital markets.

We need to deepen our understanding of what’s behind the shift and consider whether regulatory settings are contributing to perceived problems and whether regulatory intervention is needed.

Ultimately, we’re asking how we can balance the dual goals of ensuring Australia’s private and public capital markets are open, accessible and attractive to companies and investors, while protecting against risks.

There is a global discussion building about the role of regulation. Australia is no exception.

Our Chair has been outspoken about the desire to make our regulatory environment simpler to drive the growth and productivity Australia needs.

We know Australia's strong regulatory and governance framework is attractive to investors. So, it’s important we approach this from both an opportunity and risk perspective.

We encourage industry to engage with ASIC and help us answer the questions we have posed. We are looking for insights and actionable ideas to further enhance our capital markets and balance market efficiency, risk, innovation and transparency.

Contribute to ASIC’s discussion on public and private markets by responding to this discussion paper by 5pm on 28 February 2025.