ASX, Governance and Genes

• Michael Austin is the Company Secretary at Bio101. Bio101 is a financial services firm providing outsourced CFO, company secretarial and strategic financial advisory services specialising in the healthcare sector.

The Island of Dr. Moreau, written by H.G. Wells in 1896, is a tale of scientific exploration and ethical transgression. The story begins when Edward Prendick, after surviving a shipwreck, is rescued and brought to a secluded island. There, he meets Dr. Moreau, a scientist expelled from the scientific community due to his radical experiments. On the island, Prendick uncovers Moreau's ongoing experiments, which involve transforming animals into humanoid forms through a series of surgical operations. This island serves as the backdrop for themes of suffering, human nature, and the ethical limits of scientific inquiry.

Similar themes are likely considered when the Board addresses ASX Council’s Corporate Governance Recommendation 7.4. It focuses on the need for transparency in identifying and managing economic, environmental, and social sustainability risks. This principle is crucial for organisations seeking to maintain ethical standards and secure long-term shareholder value. It compels companies to consider not only their financial outcomes but also the broader impacts of their operations on society and the environment.

Leading into a discussion of social risk, particularly in the context of biotechnology and genomics, this Recommendation takes on added significance. The rapid advancements in genomic technologies present profound opportunities for medical and scientific breakthroughs. However, they also introduce substantial social risks, such as concerns about genetic privacy, discrimination, and the potential for unequal access to genomic technologies.

Genomics can dramatically alter our approach to healthcare, from personalised medicine to gene editing, but it also raises ethical and social questions. For instance, who has access to an individual's genetic information? How is it used, and who benefits from genomic discoveries? These issues highlight the need for robust governance frameworks that not only address transparency but also ensure that the benefits of genomic research are shared equitably.

In this light, Recommendation 7.4 underlines the importance of disclosing how potential social risks are identified and managed, ensuring that stakeholders are aware of how companies are addressing these challenges. For companies like those in the biotech sector, adhering to this Recommendation, or using it to begin discussion, can help in navigating the complex moral landscape of modern genetics while fostering trust and sustainability in their operations.

In light of Corporate Governance Recommendation 7.4, the board of a biotech company focusing on human gene editing technology ought to prioritise transparent and ethical management practices that address the economic, environmental, and social risks associated with their operations. This involves a thorough consideration of the ethical implications of gene editing technologies, such as CRISPR, and their impact on individuals and society at large.

The Board should ensure that policies are in place to manage these risks by engaging with stakeholders, including regulators, ethicists, and the broader community, to foster an inclusive dialogue about the benefits and potential drawbacks of gene editing. Additionally, the board should oversee the development of robust frameworks that ensure compliance with legal and ethical standards, promoting transparency in how the technology is used and how decisions are made. This approach will not only align with the principles of good corporate governance but also build trust and support sustainable development in this cutting-edge field.

The Company Secretary plays a crucial role in providing the necessary frameworks and mechanisms for the board to discuss, address, and disclose the risks faced by their organisation. This is particularly relevant when addressing Recommendation 7.4 of the ASX Council’s Corporate Governance Principles and Recommendations, which focuses on enhancing the transparency of risk management practices. Moreover, the Company Secretary's contributions are essential for the other Recommendations under the ASX Council’s guidelines, as they ensure that the board operates within a structured and well-defined governance framework the ASX Council has established.

This enables effective decision-making and risk oversight, thereby strengthening the overall governance of the organisation.