Corporations, Financial Services and Charities – Regulatory Complexity and Coherence

On 6 February 2023, Dr Andrew Godwin (Special Counsel and Team Leader at the Australian Law Reform Commission) presented a paper with Professor Rosemary Langford of Melbourne Law School on ‘Corporations, Financial Services and Charities — Regulatory Complexity and Coherence’. The paper was presented at a plenary session of the Society of Corporate Law Academics (SCOLA) 2023 Annual Conference at Swinburne University in Melbourne. The session was chaired by Emeritus Professor Stephen Bottomley of the ANU College of Law.

The paper examined complexity in the areas of corporations, financial services and charities regulation. Dr Godwin compared the challenges of complexity in each of these areas, outlined the work undertaken by the ALRC to date, including in the identification and use of complexity metrics, and engaged with research and commentary by academics such as Emeritus Professor Stephen Bottomley. Dr Godwin noted the potential benefits of metrics in terms of distinguishing between complicated and complex provisions, and agreed with Emeritus Professor Bottomley that ‘some degree of complexity is necessary or unavoidable, and that the task is to find the optimal or necessary degree of complexity to achieve the system’s aims (Stephen Bottomley, ‘The Complexity of Corporate Law’ (2022) 44(3) Sydney Law Review 415, 435).

Professor Langford then introducing her work in a research project funded by the Australian Research Council — ‘Restoring Public Trust in Charities: Reforming Governance and Enforcement’ — and explained the challenges of complexity and coherence in the regulation of charities. After outlining the causes of complexity — including overlapping duties and requirements, inconsistencies and constitutional limitations — Professor Langford suggested various solutions and concluded that some complexity is necessary to allow for diversity and nuance, and that it is a matter of managing/navigating necessary complexity and reducing unnecessary complexity.

The slides for Dr Godwin and Professor Langford’s presentation are available for download here.

The following image, highlighting the complexity of the Corporations Act, appears in the slides presented by Dr Godwin.