Research Grants

Negotiated Enforcement: Regulatory Power and Corporate Misconduct in the Financial Sector

Type of grant: Australian Research Council Discovery Grant

Funds allocated: $311,000

Year grant obtained: 2018

Project Summary: Enforcement outcomes are often the result of negotiations between regulators and alleged wrongdoers. These negotiations may, for example, result in the regulator not pursuing litigation against the alleged wrongdoer and, in return for acknowledging past misconduct and some form of promise in relation to future conduct, the alleged wrongdoer receives a reduced sanction. Regulators rely on negotiations with alleged wrongdoers to respond to misconduct, impose sanctions and promote responsible behaviour. However, there is concern about the increasing preference of regulators to use negotiated enforcement rather than litigation to counter serious misconduct in the financial sector. An over reliance on negotiated enforcement raises concern where these practices: lack transparency; are inefficient; fail to deter misbehaviour; and operate to subvert individual justice. This project evaluates these issues by examining enforcement strategies by the Australian Securities and Investments Commission (ASIC) that involve negotiations with alleged wrongdoers and the factors that are relevant to ASIC when it pursues negotiations.

Researchers: Professor Ian Ramsay (Chief Investigator) and Dr George Gilligan (Research Fellow)

Restoring public trust in charities – reforming governance and enforcement

Type of Grant: Australian Research Council Discovery Early Career Researcher Award

Funds allocated: $401,980

Year Grant Obtained: 2018

Project Summary: This project aims to undertake a comprehensive and comparative investigation of governance and enforcement in the charitable sector in Australia. Public trust in the charitable sector has been damaged by governance failures, particularly in religious contexts, exacerbated by the sector’s complex and incoherent governance system. As yet, there has been limited academic consideration or empirical analysis of the effectiveness of the governance and regulatory framework of the sector or concrete reform proposals. This project aims to undertake comparative analysis and empirical research of these aspects, and to develop proposals for effective law and policy reform. This is expected to strengthen and maximise the sector’s capacity to contribute to the social and economic life in Australia.

Researchers: Associate Professor Rosemary Teele Langford

Financial Exclusion, Poor Insurer Practices and Consumer Protection

Type of grant: Australian Research Council Discovery Grant

Funds allocated: $358,916

Year grant obtained: 2017

Project summary: General insurance encompasses three products — building, home contents and motor vehicle insurance — that are considered essential to financial inclusion in Australia. General insurance also includes more controversial products such as add-on insurance and extended warranties. This project is Australia’s first large-scale empirical study examining financial exclusion and lack of access to general insurance, as well as poor insurer practices in selling insurance and handling claims. Through surveys, focus groups and interviews, the project also aims to evaluate the effectiveness of the legal protections for consumers of general insurance.

Researchers: Professor Ian Ramsay (Melbourne Law School), Associate Professor Paul Ali (Melbourne Law School) and Evgenia Bourova (Melbourne Law School)

Directors' Liability for Insolvent Trading in Australia: Reflections on Recent Reforms From Experience in Singapore and Japan

Type of grant: Melbourne Law School International Collaboration Fund

Funds allocated: $9,110

Year grant obtained: 2017

Project summary: This project will compare approaches to director liability in an insolvency context in Australia, Singapore and Japan. A director may be liable in Australia if a company of which she or he is a director incurs a debt when it is insolvent, or becomes insolvent by incurring that debt, and there are reasonable grounds for suspecting that the company was insolvent, or would become insolvent (Corporations Act 2001, section 588G). Recently, the Australian government proposed amendments to the statutory provisions imposing liability for insolvent trading by directors. The project will evaluate the approaches to director liability when a company is insolvent in the three countries in light of the proposed reforms.

Researchers: Professor Ian Ramsay (Melbourne Law School), Associate Professor Stacey Steele (Melbourne Law School), Associate Professor Meng Seng Wee (National University of Singapore Law)

Harmful Financial Products: Analysis of Their Impact and Regulation

Type of grant: Australian Research Council Linkage Grant

Funds allocated: $620,000

Year grant obtained: 2016

Project summary: This project will investigate financial products that have the potential to harm disadvantaged and vulnerable consumers. Working in partnership with five leading non-profit organisations, and adopting empirical research techniques (including surveys, interviews and focus groups), it will explore the extent to which these products perpetuate financial hardship, poor health and social disadvantage. In doing so, it will make a significant, original contribution to consumer law scholarship and studies of financial exclusion, while also providing practical assistance to policymakers, regulators and the partner organisations. The project will assess the need for law reform, and, if appropriate, will make detailed law reform recommendations.

Researchers: Associate Professor Paul Ali (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Partner organisations: Consumer Action Law Centre, Financial Counselling Australia, Good Shepherd Australia New Zealand, Mallee Family Care Inc, Western Community Legal Centre

Comparative Insolvency Law in the Asia-Pacific

Type of grant: Melbourne Law School International Collaboration Fund

Funds allocated: $9,735

Year grant obtained: 2016

Project Summary: This project will focus on Chinese Insolvency Law, building on a long-standing collaboration between Associate Professor Jin Chun and Associate Professor Stacey Steele.  It will facilitate further collaboration, allowing Associate Professor Chun and Associate Professor Steele to conduct further research into Asian Insolvency Law.

Researchers: Associate Professor Stacey Steele (Melbourne Law School) and Associate Professor Jin Chun (Doshisha University, Japan)

Integrity in Sport: Comparative Approaches to Match-Fixing in Australia, Japan and Korea

Type of grant: Melbourne Law School Asia Research Collaboration Funding Scheme

Funds allocated: $9,000

Year grant obtained: 2016

Project Summary: This project by the Asian Law Centre and Sports Law Program at Melbourne Law School takes the form of a multi‐contributor book which examines approaches to combatting match‐fixing in Australia, Japan and South Korea. The book is part of the Asian Law Centre and Sports Law Program’s efforts to engage with Asian academics, regulators and law enforcement bodies to achieve a greater understanding of match-fixing and the current level of legal response in these key Asian sporting nations.  It builds on the papers presented at the Sports Law and Integrity Workshop in February 2015.

Researchers: Associate Professor Stacey Steele and Mr Hayden Opie (Melbourne Law School) and Dr Kee Young Yuen (Dongguk University, Republic of Korea) and Dr Young Ryuel Chung (Korea University)

Director's Conflicts: Multiple Directorships and Corporate Opportunities

Type of grant: University of Melbourne Early Career Researcher Grant

Funds allocated: $19,320

Project summary: Directors’ conflicts of interest constitute a fundamentally important governance issue both nationally and internationally. As the complexity of commercial transactions and of commercial life in general increases, the application of the conflicts duty has necessarily become more complicated. At the same time there is a constant tension between ensuring accountability and encouraging high quality candidates. Two particular contexts in which the application of the conflicts duty to directors is problematic and uncertain concern multiple directorships (where directors sit on the board of more than one company) and the pursuit in personal capacity of corporate opportunities ( opportunities which arise as a result of a director’s position or which are relevant to the company’s business). Questions persist as to the wisdom of allowing directors to sit on the board of multiple companies, particularly when those companies compete with each other. Questions also remain as to how removed an opportunity must be from a director’s position and the company’s line of business before it can be freely pursued. These issues transcend international boundaries and face regulators in many jurisdictions.

This project, which forms part of a broader comparative research agenda on directors’ duties, has as its focus the duty of directors to avoid conflicts of interest. The project involves empirical analysis of the frequency of directors holding more than one directorship in both Australia and England (in order to demonstrate the significance of the issue). It then seeks to provide guidance in relation to regulation of such multiple directorships and also in relation to the pursuit of corporate opportunities by directors – when can directors take up opportunities arising from their position or relevant to the company’s line of business? The ultimate aim of the project is to propose solutions to the conundrums posed by these issues in order to provide clarity and certainty, which are vital in the corporate arena. The results of the project will be of significant interest to academics, practitioners, directors and regulators both in Australia and England, but also in other common law jurisdictions such as Hong Kong, Singapore and Canada where these issues arise.

Researcher: Dr Rosemary Teele Langford

An Analysis of Penalties under ASIC Administered Legislation

Type of grant: Centre for International Finance and Regulation (CIFR) and the University of Melbourne

Funds allocated: $389,084

Project Summary: A significant policy debate is unfolding regarding the penalties imposed by courts and other bodies under legislation administered by key economic regulators such as ASIC. The ASIC Penalties Project will conduct a holistic review of such penalties over a 10 year period from 2005 to 2014, to assess whether adequate penalties are available to ASIC and set at an appropriate level. The project will also consider whether the penalties are effectively administered and how ASIC's penalties regime could be improved.

By combining available documentary evidence with surveys and semi-structured interviews, the ASIC Penalties Project will build a penalties database and develop a series of research papers that analyse the theoretical and policy based rationales for the imposition of penalties. These initiatives can inform not only policy development and operational practice regarding ASIC, but also can be informative for other Australian regulators, regulated communities, the judiciary, law enforcement agencies, industry, media, academe and the broader public.

Researchers: Professor Ian Ramsay, Dr George Gilligan, Mr Andrew Godwin, Mr Jasper Hedges

Predatory Conduct, Consumer Rental Goods and Indigenous Consumers

Type of Grant: Melbourne Law School Indigenous Research Grant

Funds Received: $5,000

Project Summary: There is strong evidence that consumer rental companies target Indigenous communities across Australia and engage in highly predatory conduct. The Australian Securities and Investments Commission (ASIC) is involved in ongoing regulatory enforcement across Australia to reign in companies found to act unconscionably and cause irreparable harm to Indigenous consumers. While regulatory action is welcome, peak consumer legal and Indigenous organisations have expressed concern that the harm to Indigenous consumers is ongoing and that more action, from a range of state and federal agencies and organisations, is required to stamp out predatory practices and ameliorate the harm caused to consumers. To effectively reduce harm, it is clear that the problem requires multiple organisations with different expertise to collaboratively and holistically develop effective consumer protection laws and complementary policies. The research team will conduct innovative and much needed research to investigate the legal and social factors contributing to the harm to Indigenous consumers.

Researchers:  Associate Professor Paul Ali, Ms Cosima McRae and Professor Ian Ramsay

Disciplining insolvency practitioners in Australia and Singapore: legal and policy trends

Type of grant: NUS Law - MLS Research Partnerships

Funds received: $20,000

Project summary: This research partnership will investigate legal and policy trends in disciplining corporate insolvency practitioners in Australia and Singapore. Both jurisdictions have common origins in their respective corporations laws, and both have recently undertaken reviews of the regulation of practitioners in recognition of the significant role they play in the resolution of corporate insolvencies. The research will focus on models of disciplinary frameworks and the outcomes that could be achieved through reform; the effect that the introduction of clear and robust qualification standards, disciplinary procedures and disqualification standards could have on the profession; and the role of various institutions in discipline.

Researchers: Professor Ian Ramsay (Melbourne Law School), Ms Stacey Steele (Melbourne Law School), Assistant Professor Meng Seng Wee (National University of Singapore Law)

Financial Literacy and Innovation in Superannuation Product Disclosure: Improving the Retirement Savings of Australians

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Superannuation is the central pillar of Australia's unique retirement savings system. Current estimates predict that only 35% of Australians will be adequately provided for in retirement. Factors including an aging population, increased life-expectancies and higher costs of living and the inadequacy of many superannuation balances suggest strongly the need for working Australians to actively manage their superannuation investments from earlier in their working lives. Our project responds to these issues by focussing on the potential for regulatory innovations in superannuation consumer information to change consumer behaviour. Specifically, our study proposes to survey 25-35 year old superannuation consumers to understand the interaction with superannuation information.

Drawing on behavioural economics our study will provide regulators, the superannuation industry and consumer bodies with key insights about how superannuation information can assist consumers in their retirement savings planning. Our project will offer new insights about current behaviours and attitudes with the potential to improve retirement savings outcomes.

Researchers: Associate Professor Paul Ali, Professor Ian Ramsay and Dr Chander Shekhar

Phoenix activity: Regulating fraudulent use of the corporate form

Type of grant: Australian Research Council Discovery Grant

Funds received: $403,000

Project summary: Fraudulent phoenix activity is of great concern to Australian policymakers. It occurs where there is the deliberate liquidation of a company to avoid paying debts but the business continues through another company, and in corporate groups through the liquidation of undercapitalised subsidiaries and transfer of business to other companies in the group. This behaviour causes huge losses in taxation revenue and large financial losses for employees and unsecured creditors. To strengthen Australia's economic fabric, this project aims to determine the optimal method of dealing with fraudulent phoenix activity through a thorough examination of all of its aspects in Australia and by a comparative analysis of international responses.

Researchers: Associate Professor Helen Anderson, Professor Ann O'Connell, Professor Ian Ramsay and Dr Michelle Welsh

The legal and social dimensions of financial hardship in Australia: Implications for legal, regulatory and policy frameworks

Type of grant: Australian Research Council Discovery Grant

Funds received: $396,000

Project summary: Financial hardship – the reduced ability to meet monetary obligations because of loss of employment, illness or disaster – is an increasing problem for both low-income and middle-income Australians. This project is the first in-depth study of the practical operation of Australia's financial hardship laws, which are designed to protect Australians suffering financial hardship. Surveys and interviews will be undertaken of persons suffering financial hardship, those who advise them and staff of financial dispute resolution schemes. The project outcomes will include improvements to dispute resolution involving financial hardship and consumer advisory services, and potential law reform proposals.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Assessing the Governance of Institutional Investors when Investing in Complex Financial Products

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Institutional investment in Australia is both highly innovative and complex. The global financial crisis and the large losses that have flowed from investments in complex financial products have focused attention on the sellers of those products. However, less attention has been paid to the institutional investors who invest in complex financial products and the role of the external parties that provide investment-related services to institutional investors. This project will be the first in-depth study of the legal structure of Australian institutional investment, in the context of investments in complex financial products, the legal relationships between the participants in the selection of those investments and the legal duties that arise out of those relationships. This project will also examine the legal protections available to institutional investors and their own investors, when investing in complex financial products, and whether regulatory reform is required.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Financial Products and Short-form Disclosure Documents – Challenges and Trends

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Recent years have seen a global trend towards the adoption of uniform rules governing disclosure in relation to retail financial products. This trend has been reflected in the adoption of plain language techniques, the move towards short-form disclosure documents, and efforts to increase the quality of financial advice and financial literacy on the part of retail investors.

This project will analyse the challenges and trends in relation to short-form disclosure documents from a comparative perspective. The research will consider the effectiveness of short-form disclosure documents, particularly in terms of increasing risk awareness, the interface between short-form disclosure documents and other measures (e.g. plain language techniques and investor education) and whether there is a case for global or regional harmonisation. Developments in the following markets will be examined for this purpose: Australia, New Zealand, the United Kingdom, Hong Kong and Singapore.

Researchers: Mr Andrew Godwin and Professor Ian Ramsay

Evaluating the Impact of Securities Loans on Shareholder Rights and the Governance of Listed Companies

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Securities loans are a common feature of the Australian and global financial markets, and describe dealings under which a trader or investor sources securities temporarily from institutional investors, such as a superannuation fund. This practice has generated considerable controversy in the midst of the global financial crisis due to the prominent role deployed by securities loans in facilitating short selling. In addition to this, securities loans carry broad implications for the governance of companies. Securities loans make possible vote buying, by enabling the voting rights attaching to shares to be separated from the economic ownership represented by those shares. This project will be the first in-depth Australian study of the corporate governance implications of securities loans. The project will also examine the implications for shareholder rights and consider whether regulatory reform is required to protect shareholders.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Financial System Regulation – is Australia's "twin peaks" approach a model for China?

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: The global financial crisis and its fallout have tested the integrity and resilience of regulatory frameworks in respect of financial services and have led to significant reforms to those frameworks around the world. As financial institutions and the financial markets in China become more integrated and sophisticated, it is likely that China will need to re-consider its approach to financial regulation and review developments in other markets. Inevitably, its attention will turn to the models and reforms introduced in markets such as the United Kingdom and the United States. In this research project, the researchers propose to consider the extent to which Australia's 'twin peaks' approach to financial services regulation provides a model for reform in China. Although the primary focus is on China, the researchers will also consider the extent to which the 'twin peaks' model is relevant to other emerging markets in Asia.

Researchers: Mr Andrew Godwin, Professor Ian Ramsay and Professor Li Guo

Success and Failure in Stock Exchange Consolidations: Implications for Markets and their Regulation

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Stock exchanges engaged in a frenzy of consolidation efforts recently, some successful, others not. In 2011 alone, several high profile mergers, Singapore and Sydney, NYSE Euronext and Deutsche Borse, London and Toronto, met with regulatory, political and industry opposition. In one sense, the exchanges are only catching up with the technological realities of international markets. Traditional market institutions have been undergoing change and restructuring for decades. Consolidation began at national levels in response to competitive pressures, and then spread to the creation of regional and supra-regional institutions in an effort to achieve strategic and operational advantages. This project examines the process of stock exchange consolidations, and the alternatives, from a regulatory and market perspective and examines the reasons for success or failure. There are lessons to be learned from both the successes and the failures, with implications for the future direction of regulatory change and the market institutions themselves.

Researchers: Professor Cally Jordan and Professor Stephane Rousseau

Financial regulation in Asia – A new model for regional cooperation

Type of grant: Melbourne School of Government Research Cluster Grant

Funds received: $213,917

Chief investigators: Mr Andrew Godwin (Melbourne Law School), Professor Andrew Mitchell (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Professor Kevin Davis (School of Business and Economics), Dr Jikon Lai (Faculty of Arts), Professor Andrew Walter (Faculty of Arts)

External collaborators: Professor Douglas Arner (Law Faculty, University of Hong Kong), Mr Datuk Seri Panglima Andrew Sheng (Fung Global Institute), Professor Wataru Takahashi (Faculty of Economics, Osaka University), Professor Ken Waller (Faculty of Finance & Economics, Australian AOEC Study Centre, RMIT)

Project summary: This project will study the development of Asian financial regulations from a variety of perspectives such as finance, law, politics and international relations. The study will focus on the unique circumstances present in Asia as well as identifying the risks and the value that regional cooperation and integration can play in the development of international regulatory rules.

Evaluating Australian personal insolvency laws in the context of changing demographics and increasing financial stress

Type of grant: Australian Research Council Linkage Grant

Funds received: $425,465

Chief investigators: Associate Professor Paul Ali (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Dr Kathy Landvogt (Good Shepherd Youth & Family Service), Mr Gerard Brody (Consumer Action Law Centre), and Ms Fiona Guthrie (Financial Counselling Australia Incorporated)

Project summary: This project will study how Australians respond to financial stress within the context of Australian personal insolvency laws. A better understanding of the practical impact of these laws today will enable an evaluation of their effectiveness in meeting policy objectives.

A Comparative Analysis of the Reform of Personal Property Security Law in Australia and the United Kingdom

Type of Grant: Oxford University Law School – Melbourne Law School Research Partnerships Grant

Funds Received: $17,500 and £10,000

Chief Investigators: Associate Professor Paul Ali, Professor Ian Ramsay and Professor Louise Gullifer (University of Oxford)

Project Summary: The law of personal property security deals broadly with the issue of how lenders and other providers of corporate and consumer credit can protect their claims against borrowers by taking security over the personal property held by borrowers. Personal property securities reduce the risks associated with providing credit and should therefore contribute to the increased availability of credit. Balanced against this, however, are the legal complexities confronted by lenders when taking security over personal property. This area of law has been the subject of several proposals for reform in both the UK and Australia. This project aims to assess the divergent approaches towards the regulation of personal property securities in the two jurisdictions, with a view to seeing what benefits an Australian Personal Property Securities Act 2009 - type reform could have for the UK and also what pitfalls are likely in any such reform process.

Reform of consumer lease contracts - Ensuring greater protection for consumers

Type of grant: Victorian Law Foundation Grant

Funds received: $4,990

Chief investigators: Associate Professor Paul Ali, Cosima McRae and Professor Ian Ramsay

Project summary: Consumer leases can be an expensive and unhealthy form of consumer credit with some lenders targeting financially vulnerable consumers. The project investigates the experiences of consumers with consumer leases and evaluates current regulation with the aim of determining whether reform is needed.

Safeguarding the Financial Well-Being of Australians by Improving Financial Literacy: Implications for Consumer Protection Laws

Type of grant: Australian Research Council Discovery Grant

Funds received: $276,000

Chief investigators: Associate Professor Paul Ali and Professor Ian Ramsay

Project summary: The project will contribute to a broader understanding of the role of financial literacy in Australia and its relationship with Australia's financial services and consumer protection laws. Having financially literate consumers facilitates the uptake and development of innovative financial products. This is essential for promoting an innovation culture and economy. Higher levels of financial literacy also enable consumers to plan better for their and their families' financial well-being. This also has national benefit as it means that consumers are better prepared to deal with the adverse financial consequences of job-loss, illness, disablement or death, thus reducing the stresses and demands on Australia's social welfare safety net.

New Initiatives in Enforcing Employment Standards: Assessing the Effectiveness of Federal Government Compliance Strategies

Type of grant: Australian Research Council Linkage Project

Funds received: $180,000

Chief investigators: Associate Professor John Howe and Associate Professor Sean Cooney

Project summary: The well-being of more than eight million Australian employees is underpinned by statutory workplace entitlements. For the large majority of those employees, these are set by federal legislation. The statutory entitlements are meaningful only in so far as they are complied with, and improving the effectiveness of the federal enforcement agency, the Workplace Ombudsman, is therefore of crucial public importance. This project provides the first comprehensive scholarly empirical evaluation of the Workplace Ombudsman. Its findings will identify multiple ways in which enforcement practices can be improved, not only for the Workplace Ombudsman, but also for comparable compliance agencies domestically and overseas.

Legal Origins: The Impact of Different Legal Systems on the Regulation of the Business Enterprise in the Asia-Pacific Region

Type of grant: Australian Research Council Discovery Grant

Funds received: $250,000

Chief investigators: Professor Ian Ramsay together with Professor Richard Mitchell, Associate Professor Sean Cooney and Associate Professor Peter Gahan

Project summary: This project will locate Australia and several major countries in our region within a highly influential international scholarly debate about appropriate forms of business regulation. It will contribute to domestic policy-making debates about the most effective legal methods for promoting an innovative and productive economy, especially in the areas of corporate and labour law. It will also enable Australian policy makers to participate in international policy reform debates facilitated through international institutions. In particular, it will enhance Australia's capacity to understand and contribute to the establishment of better legal systems in our region, enhancing important trading and strategic relationships.

The Costs of Corporate Litigation in Australia

Type of grant: Melbourne Centre for Financial Studies Grant

Funds received: $12,000

Chief investigators: Professor Ian Ramsay and Associate Professor Asjeet Lamba (Faculty of Economics and Commerce)

Project summary: The project examines the costs associated with corporate litigation and the possible sources of these costs. The project provides further evidence on: (a) the costs of litigation involving companies and a breakdown of these costs by party and legal issue and (b) the rules on allocating legal costs between parties. The results of the project should lead to a better understanding of the market's reaction to corporate litigation, settlement and judgment events leading to more informed dispute resolution.

The Impact of Variable Rate Home Loan Early Termination Fees on Low Income Vulnerable Home-Owners

Type of Grant: Victoria Law Foundation Grant

Funds Received: $4,565

Chief Investigator: Professor Ian Ramsay

Project Summary: Vulnerable home owners with variable rate mortgages have recently been 'locked into' mortgages with lenders who have (1) unilaterally increased interest rates to un-competitively high levels; and (2) unilaterally imposed very high early termination fees. The project investigates the extent to which the law provides consumers with a remedy to challenge excessive early termination fees and aims to suggest law reform avenues that may be necessary.

A Cancer on our Economy? An Empirical Interdisciplinary Study of the Criminalisation of Serious Cartel Conduct in Australia

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $340,000

Chief Investigators: Dr CE Parker together with Dr CY Beaton-Wells, Dr FS Haines and Professor DK Round

Project Summary: Serious cartel conduct is seen as highly damaging to Australia's economic welfare but only recently has it been regarded as criminal. This research will inform public debate about the impetus and justification for this major shift in competition law policy and enforcement. It will provide robust empirical evidence about public opinion and business behaviour and derive insights into whether criminalisation will promote greater compliance with the law. It will assist in refining practical implementation measures to ensure the effectiveness of a criminal regime and it will aid legislators and regulators in policy-making, regulatory design and enforcement in relation to competition law and business regulation more generally.

The Liability of Corporate Groups

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $157,618

Chief Investigator: Associate Professor Helen Anderson and Associate Professor Christian Witting

Project Summary: The importance of a re examination of the rules of limited liability has been demonstrated in many recent cases of corporate wrongdoing and collapse. This has been highlighted by the restructuring of the James Hardie Group of companies, the conscious aim of which was the decision to free the group of its asbestos liability 'legacy'. Were it not for government intervention, thousands of persons injured by asbestos products would have gone without compensation. One means by which such unfairness can be avoided is by reform to the rules of limited liability. This project will explore the means by which this could be achieved.

Employee Share Ownership Plans: Current Practice and Regulatory Reform

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $323,000

Chief Investigators: Professor Ian Ramsay, Professor Cameron Rider, Associate Professor Ann O'Connell and Professor Richard Mitchell

Project Summary: Employee Share Ownership Plans (ESOPs) are important to the development of an economic culture of enterprise and innovation and the building of national wealth and savings in response to long-term demands of intergenerational equity. ESOPs require development through appropriate regulatory frameworks. This project will subject the existing regime of tax, corporate and labour law to technical and empirical scrutiny. This will enhance the capacity of policy makers to evaluate and identify appropriate regulatory techniques to ensure the growth of efficiency of ESOPs at the national and enterprise level.

The Impact of ACCC Enforcement Action: Evaluating the Explanatory and Normative Power of Responsive Regulation and Responsive Law

Type of Grant: Australian Research Council Discovery Grant (Australian Research Fellowship)

Funds Received: $350,000

Chief Investigators: Dr Christine Parker and Vibeke Nielsen

Project Summary: The project will enhance the capacity of the ACCC and other business regulators to ethically and effectively regulate to achieve the goals of regulatory policy such as a fair, competitive economy, occupational health and safety, and environmental integrity. Australia is already well recognised as a leader in ambitious empirical and policy oriented social science research on regulatory compliance (through the ARC funded Governance Network including RegNet at ANU). This project will enhance that reputation with the most comprehensive data set on the corporate compliance impact of enforcement action and fundamental re-thinking of foundational theoretical questions about the nature and capacities of regulation.

The Governance Research Network (GovNet)

Type of Grant: Australian Research Council Research Network Grant

Funds received: $1,500,000

Chief investigators: Professor Charles Sampford, Griffith University; Centre for Corporate Law Participants: Professor Ian Ramsay and Dr Christine Parker

This project brings together 50 scholars from 12 universities to undertake cross-disciplinary governance research.

Project Summary: Institutions and their governance are frequently part of our most pressing problems - not least in our national research priorities. Hence, institutions are invariably a key part of the solutions. GovNet unites three ARC Centres, two existing networks (RegNet, ANZSOG) and several other dynamic centres to create an interdisciplinary network of ethicists, lawyers, political scientists, economists and historians. It will tackle issues of institutional governance, from small firms to global institutions recognising both common governance issues and radically differing contexts. Together with APSEG and government agencies, it will apply cutting edge cross-disciplinary, theory-driven, evidence-based research to governance issues in the region.

Corporate Governance and Institutional Investment in the Australian Financial Markets

Type of Grant: Australian Research Council Discovery Grant

Funds received: $130,000

Chief investigators: Dr Paul Ali and Dr Geof Stapledon

Project Summary:The financial markets play a vital role in Australian economic life. The majority of the assets of Australian superannuation funds and managed investment funds are financial products. This project will provide an comprehensive account of the different types of complex financial products available in Australia and an assessment of the corporate governance practices at Australian companies and Australian institutional investors in relation to their use of complex financial products. Through these outcomes, the project will contribute to a broader understanding of the Australian financial markets and the enhancement of corporate governance practices in Australia.

Corporate Governance in the Australian Financial Markets

Type of Grant: Melbourne University Research Grant

Funds received: $14,000

Chief investigators: Dr Paul Ali and Dr Geof Stapledon

Project Summary: The project examines the corporate governance aspects of transactions in the Australian financial markets, in particular the legal design of complex financial products, the efficacy of the new regime introduced by the Financial Services Reform Act 2001 (Cth) for the regulation of financial products, and the role of institutional investors in supervising the use of complex financial products by the companies in which they have invested.

Synthetic Securitisations and the Revolution in Credit Risk Management

Type of Grant: Melbourne University Early Career Researcher Grant

Funds received: $8,750

Chief Investigator: Dr Paul Ali

Project Summary: This project focuses on recent innovations in securitisation, particularly in relation to the issuance of debt securities backed by derivatives. These so-called synthetic securitisations, in essence, segregate assets into their component risks and effect a transfer of certain risks independent of the assets to the investors in the debt securities. The key example is the synthetic CDO (Collateralised Debt Obligations) which involves the securitisation of the credit risk on bond or loan portfolios. The emerging class of managed arbitrage synthetic CDOs is also examined. In addition, the project investigates the securitisation of non-traditional assets.

Partnerships at Work: The Interaction Between Employment Systems and Corporate Governance and Ownership Structure

Type of Grant: Australian Research Council Discovery Grant

Chief Investigators: Professor Ian Ramsay, Professor Richard Mitchell

Funds Received: $640,500

Project Summary: The project will examine the interaction between several key factors in the creation and sustainability of 'Partnerships at Work'. These factors include particular employment systems, forms of corporate governance and ownership structures. The project proposes to discover how these various factors have interacted so as to give rise to — or fail to give rise to — 'high performance' partnership-style relations at work. This project will focus on the interaction between these factors within a regulatory environment established by labour law and corporate law. What are the elements of 'co-operative' or 'partnership' employment systems? What are the integrating institutions or conventions - if any - that incorporate workers or their representatives into managerial processes? How do company directors actually balance the interests of employees and shareholders within the framework of the obligations imposed by directors' duties? How flexible are those duties? What possible shortcomings might exist in the practical application of those duties? Is there a congruence between types of corporate governance systems and types of employment system?

Islamic Law in Contemporary Indonesia

Type of Grant: Australian Research Council Discovery Grant

Chief Investigators: Associate Professor Tim Lindsey and Barry Hooker (Australian National University)

Funds Received: $139,270

Project Summary: This project aims to fill serious gaps in Asian and Western scholarship on Islamic law in contemporary Indonesia in the context of the tension between Islam and state, an issue highlighted by the Bali bomb and Jemaah Islamiyah trials. It aims to do so by working closely with leading Indonesian legal scholars and institutions to develop an approach to researching Islamic law that embraces internal Islamic jurisprudence, both Middle Eastern and Southeast Asian, as well as leading Western scholarship on Islam and law. It seeks a new syncretic approach to Islamic legal scholarship, to be constructed within the limited confines of an investigation into the practical operation of syariah in Indonesia in the last 50 years, with a particular focus on the last decade. This project aims to produce journal articles, briefing papers, teaching materials and a joint monograph by the Chief Investigators in English and Indonesian. In the longer term, this project will contribute to increasing Australian understandings of Islamic law, culture and societies.

Accountability and Corporate Governance in Non-Profit Companies

Type of Grant: Australian Research Council Strategic Partnerships with Industry Grant

Chief Investigators: Professor Ian Ramsay, Ms Sue Woodward and Ms Sally Sievers

Industry Partner: Philanthropy Australia Inc

Funds Received: $80,000 with matching funds contributed by Philanthropy Australia Inc

Project Summary: Australians give $2.8 billion annually to non-profit organisations. Official estimates suggest spending by these organisations represents almost 10% of Gross Domestic Product. Increasingly the importance of the sector is being recognised, but in Australia there has been limited research into non-profit companies. This collaborative project will examine the appropriateness of existing corporate structures for non-profit organisations. It will also evaluate the effectiveness of laws relating to directors' duties as a means of providing accountability and good governance to stakeholders (eg, members, grant givers and the public). The appropriateness of laws designed for companies with profit-making objectives will be challenged.

Directorship in Entrepreneurial Firms and the Role of Public and Private Capital Markets

Type of Grant: Australian Research Council Large Grant

Chief Investigators: Associate Professor Michael Whincop (Griffith University Law School), Professor Ian Ramsay and Dr Geof Stapledon (University of Melbourne Law School) and Professor R J Gilson (Stanford and Columbia Law Schools)

Funds Received: $127,393

Project Summary: This project examines the purposes of boards of directors in entrepreneurial firms, the optimal corporate law to support these institutions, characteristics of the market for these director services, and the connection with public and private capital markets. We will examine and challenge the applicability of corporate governance models developed for listed corporations to entrepreneurial firms. We will test hypotheses concerning the effect of venture capital and the investor's strategy for exiting the firm on the structure of entrepreneurial boards. The empirically enriched understanding and normative policy analysis of the most dynamic firms in modern economies will reshape corporate regulation and scholarship.

The Governance of Managed Investment Schemes

Type of Grant: Australian Research Council Large Grant

Chief Researchers: Professor Ian Ramsay, Ms Pamela Hanrahan and Dr Geof Stapledon

Funds Received: $137,000

Project Summary: As of 30 June 1998, the consolidated assets of managed investment schemes such as cash management, equity and property trusts in Australia exceeded $100 billion. The Managed Investments Act 1998 (Cth) introduced a fundamentally new regime for the regulatory oversight and governance of managed investment schemes. This project examines and evaluates the effectiveness and efficiency of this new regime as a means of ensuring compliance with the requirements of the Managed Investments Act and for maximising investor protection.

Use and Operation of the Enforcement Regime Attracted by Contraventions of Directors' Duties in the Australian Corporations Law

Type of Grant: Australian Research Council Strategic Partnership with Industry - Research and Training Grant

Chief Researchers: Professor Ian Ramsay, Ms Helen Bird and Professor Arie Freiberg (Department of Criminology, The University of Melbourne)

Industry Partner: The Australian Securities and Investments Commission

Funds Received: $90,000 with matching funds contributed by the Australian Securities and Investments Commission

Project Summary: This project is the first comprehensive study of the operation of civil penalties and other sanctions for promoting compliance with legislation imposing duties on directors of Australian corporations. It involves an empirical study of enforcement and prosecution activities undertaken by the Australian corporate law regulator, the Australian Securities and Investments Commission (ASIC), from its inception in 1991 until 1998. The significance of the project is that it will be undertaken at a time when there is widespread community concern about corporate crime. The project will evaluate the effectiveness of enforcement of directors' duties by ASIC.

Electronic Prospectuses: Devising an Appropriate Regulatory Regime

Type of Grant: Australian Research Council Strategic Partnership with Industry - Research and Training Grant

Chief Researchers: Dr Elizabeth Boros and Professor Ian Ramsay

Industry Partner: The Australian Securities and Investments Commission

Funds Received: $93,000 with matching funds contributed by the Australian Securities and Investments Commission

Project Summary: In late 1996 the Australian Securities and Investments Commission (ASIC) stated that it would permit the distribution of prospectuses on the Internet. In 1995 almost $5 billion in capital was raised by companies listed on the Australian Stock Exchange using prospectuses to raise capital. However ASIC still requires the existence of a paper prospectus. This project aims, in collaboration with ASIC, to devise a regulatory regime which will meet the three goals of (1) enabling market participants to fully exploit the capabilities of electronic commerce; (2) protecting investors; and (3) harmonising Australian law with international regulatory regimes.

Corporate Disclosure: An Analysis of the Role of Prospectuses in Capital Raising in Australia and New Zealand

Type of Grant: Australian Research Council Large Grant

Chief Researchers: Professor Ian Ramsay and Mr Gordon Walker (University of Canterbury)

Funds Received: $65,000

Project Summary: Public investment in the shares of Australian and New Zealand companies is undertaken by companies preparing and issuing prospectuses. Yet there are major concerns that the existing law regulating prospectuses does not adequately reflect an appropriate balance of the costs and benefits associated with prospectus regulation. The project will test the actual use made of prospectuses by investors and their advisers. It will also obtain evidence on why there is substantial non-compliance with the existing law regulating prospectuses.

The Impact of Institutional Investors on Capital Markets and Corporate Performance

Type of Grant: Australian Research Council Collaborative Grant

Chief Researchers: Professor Ian Ramsay, Dr Geof Stapledon and Professor Kevin Davis (Department of Accounting and Finance, The University of Melbourne)

Industry Partner: The Australian Investment Managers' Association (which represents approximately the 60 largest institutional investors in Australia)

Funds Received: $72,452 with matching funds contributed by the Australian Investment Managers' Association

Project Summary: Institutional investors are significant investors in Australian companies. The impact of institutional investment upon capital markets and upon corporate performance are important matters that have been widely researched overseas, but have received little attention in Australia. One reason for the lack of Australian research is the lack of information about institutional shareholdings in Australian companies. The project will provide this information, largely through the Australian Investment Managers' Association, by identifying the fund managers which control the registered shareholdings disclosed by companies. The information will then be utilised in several studies of the impact of institutional investors on the capital markets and corporate performance.

Southeast Asian Laws in Transition: 1945-1995

Type of Grant: Australian Research Council Large Grant

Chief Researcher: Dr Timothy Lindsey

Funds Received: $128,000

Project Summary: This research project has two aims. First, to access and analyse legal materials and original sources currently unavailable to researchers and practitioners in Asian Law. Second, to publish twelve volumes of materials and commentary (two theoretical and ten covering individual countries) providing resources for practising and academic lawyers for understanding:

1. legal and commercial developments in South-East Asia; and
2. the intra-regional influence of Japan and China on law and business in South-East Asia.

Directors' Misconduct Decriminalised: Are the "Civil" Sanctions in the Corporations Law Effective?

Type of Grant: Criminology Research Council Grant

Chief Researchers: Ms Helen Bird, Dr George Gilligan and Professor Ian Ramsay

Funds Received: $20,395

Project Summary: This project examines the effect of decriminalisation of misconduct by company directors in contravention of the Corporations Law. It involves an empirical study of prosecution and enforcement actions taken by the Australian Securities and Investments Commission before and since decriminalisation took effect in 1993. It also involves a comparative study of other enforcement regimes and activity in England, Canada and New Zealand.

Using Electronic Commerce to Authorise Electronic Transactions: Changes Required to the Legal and Regulatory Framework

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Associate Professor Mark Sneddon

Funds Received: $15,000

Project Summary: Many governments and businesses have proposed that paper-based transactions as diverse as sales contracts and issuing drivers' licences be replaced by electronic messages. Electronic signatures will be used to authenticate the sender's identity and make the person to whom that signature is certified to belong legally bound by the message. The possible changes required to existing laws involve important policy choices. This project will (1) identify existing Australian laws that would require alteration and (2) provide a comparative analysis of the models for legal change proposed in Australia and overseas and their underpinning policy choices.

The Role of Institutional Investors in Corporate Governance and the Influence of Corporate Law on this Role

Type of Grant: Australian Research Council Small Grant

Chief Researchers: Professor Ian Ramsay and Dr Geof Stapledon

Funds Received: $19,800 plus research infrastructure funds provided by The University of Melbourne of $4,954

Project Summary: There is a lack of evidence and information on the role of institutional investors in corporate ownership and control. The project provides this evidence by way of detailed interviews with Australian institutional investors on a range of matters relating to their activities and views on corporate governance and investment policy. The project also identifies possible barriers, including legal barriers, to institutional investor activism (ie, why institutional investors may not actively monitor the management of companies in which they invest) and the views of institutional investors are sought in relation to whether these possible barriers do actually inhibit institutional investor activism.

Selling Managed Funds: CLERP 6 and the Proposed Uniform Laws Governing the Distribution of Interests in Managed Funds

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Ms Pamela Hanrahan

Funds Received: $10,000

Project Summary: Millions of Australians invest in managed funds such as superannuation funds, public unit trusts and investment linked life insurance products. Currently, the investor protection laws applying to the distribution (sale) of these investments are not uniform across the different segments of the industry. To cure this (and other perceived problems with the existing laws) extensive amendment to the laws governing disclosure and inter-mediation in the distribution of managed funds has recently been proposed under the Corporate Law Economic Reform Program. The purpose of this project is to examine those proposals and their likely effect on investor protection and industry efficiency.

Reducing the Cost of Capital Raising: An Empirical Analysis of ASIC Modifications of the Fundraising Provisions of the Corporations Law

Type of Grant: Australian Research Council Small Grant

Chief Researcher: Dr Geof Stapledon

Funds Received: $7,500

Project Summary: The Australian Securities and Investments Commission (ASIC) has the power to modify the prospectus - and other fundraising - provisions of the Corporations Law on a case-by-case basis. The project involves an analysis of the use of this power by ASIC. The objective is to determine whether the statutory fundraising requirements could be reduced further than is being proposed under the Federal Government's Corporate Law Economic Reform Program (CLERP), in order to minimise the cost of capital raising to Australian business.

An Analysis of Factors Influencing the Share Buy-back Decision

Type of Grant: University of Melbourne Faculty of Economics and Commerce Research Grant

Chief Researchers: Professor Ian Ramsay and Dr Asjeet Lamba (Centre of Financial Studies, The University of Melbourne)

Funds Received: $7,000

Project Summary: This project extends and expands upon a study conducted by the Chief Researchers titled "Share Buy-backs in a Highly Regulated and Less Regulated Market Environment" which documents the market's valuation of share buy-backs announced by ASX listed firms during 1989-98. In addition to updating and extending this study, this project will provide evidence on (1) the long run return behaviour of various share buy-back programs and (2) the relationship between firm-specific variables and the short run and long run return behaviour of share buy-backs. The results of the study should lead to a better understanding of the factors influencing the share buy-back decision of managers.

Compulsory Acquisition of Minority Shareholdings

Type of Grant: Australian Research Council Small Grant

Chief Researcher: Dr Elizabeth Boros

Funds Received: $7,000 plus research infrastructure funds provided by The University of Melbourne of $3,500

Project Summary: Debate regarding the landmark decision in Gambotto v WCP Ltd has culminated in a law reform proposal by the Companies and Securities Advisory Committee (CASAC) proposing expansion of the range of situations in which a majority shareholder can compulsorily acquire all outstanding shares in a company. This project will conduct detailed interviews with takeover offerors in order to ascertain the relative importance to them of the various benefits of 100 per cent ownership. It will then seek to determine whether the most significant of those advantages can be achieved by means other than expropriation of minority shareholdings and, if so, to suggest alternative directions for law reform to that proposed by CASAC.

The Costs of Corporate Litigation

Type of Grant: University of Melbourne Faculty of Economics and Commerce Research Grant

Chief Researchers: Professor Ian Ramsay and Dr Asjeet Lamba (Centre of Financial Studies, The University of Melbourne)

Funds Received: $8,900

Project Summary: The project examines the costs associated with corporate litigation and possible sources of these costs by using event study methodology. In particular, the study provides evidence on (1) the costs of litigation involving companies and a breakdown of these costs and (2) the rules on allocating legal costs between parties. The results of the study should lead to a better understanding of the market's reaction to corporate litigation events and to more informed dispute resolution.

The Legal Implications of the Relative Performance of Publicly Listed Australian Companies With and Without a Controlling Shareholder

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Geof Stapledon

Funds Received: $12,000

Project Summary: Many publicly listed Australian companies have a single shareholder who/which has effective control of the company. The project will compare the past performance of such controlled companies with that of non-controlled listed companies. If the performance of the controlled companies is superior then there may well be a case for amending certain parts of the legislation governing takeovers so as to produce a legal framework more conducive to controlled companies. This in turn would probably lead to improved performance by the Australian corporate sector overall.

Analysis of Victorian Legal Signature and Writing Requirements for Compatibility With the Proposed Electronic Commerce Framework Act

Type of Grant: State of Victoria Office of Multimedia

Chief Researcher: Associate Professor Mark Sneddon

Funds Received: $16,340

Project Summary: This project will investigate the legislative need to facilitate electronic signatures and records with particular focus upon Victorian legislation.

Remedies for Directors' Improper Use of Position

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Elizabeth Boros

Funds Received: $12,000

Project Summary: This project focuses on the situation where directors divert a business opportunity away from the company of which they are a director either to themselves or to another company of which they are also a director. Specifically, it:

1. examines the means by which courts determine the amounts which are recoverable from directors in equitable proceedings and in proceedings brought under statutory provisions; and
2. seeks to identify the assumptions and policies underlying the results of the decided cases.

Women and Commerce

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Belinda Fehlberg

Funds Received: $8,000

Project Summary: Commercial law (including corporate law) has historically been dominated by men. This project will analyse legal and other materials (for example government reports) to consider:

1. how United Kingdom and Australian law depicts women in commercial (including corporate) transactions; and

1. to what extent the law in this area reflects the practical role of women and the concerns of women