ASIC has commenced civil penalty proceedings against former Super Retail Group CEO and Managing Director Anthony Heraghty, alleging he breached his directors’ duties and provided misleading information to the board and the market.
ASIC alleges Mr Heraghty failed to disclose and manage conflicts of interest arising from an alleged undisclosed relationship he had with a senior executive at the company and, in particular, that he:
- continued to supervise the senior executive and participated in decisions affecting their employment, remuneration, incentives, rewards and redundancy package;
- participated in board and committee discussions of complaints and anticipated legal proceedings concerning the alleged undisclosed relationship; and
- provided or authorised information to be released to SRG’s board and the market that omitted information concerning the alleged undisclosed relationship and was therefore misleading.
ASIC Chair Sarah Court said governance and directors’ duties failures and misconduct damaging market integrity are enduring enforcement priorities for ASIC.
‘ASIC alleges Mr Heraghty put himself in a position where his personal interests conflicted with his duties to Super Retail Group and that he failed to properly disclose and manage that conflict.
‘The allegations in this matter raise important issues about governance, transparency and trust in the information provided to boards and the market.
‘This case is not about private relationships, but whether a director properly disclosed and managed conflicts of interest and met their duties to the company and shareholders.
‘Trust and integrity underpin Australia’s market and corporate sector, and it is critical that directors fully meet their obligations of transparency and accountability; where we consider they have failed to do so ASIC will not hesitate to act,’ the Chair said.
ASIC alleges these matters exposed Super Retail Group to foreseeable risks of harm, including risks to its corporate reputation, complaints and litigation, regulatory action, costs, and harm to its share price and shareholders.
ASIC is seeking declarations of contravention, pecuniary penalties and disqualification orders.
