Director share trading: it's about the optics, too

Key Points:

The guidance highlights personal reputational risk (which is more likely to capture the attention of a director or executive) as a means to achieving the protection of the integrity and reputation of the market as a whole.

In the wake of the David Jones directorial share trading "incident", ASX has revised its Guidance Note on company trading policies.

The two most important aspects of the new policy are a major emphasis on the reputational risks of director share trading and a more prescriptive set of suggested guidelines.

Background

In 2013, two directors of David Jones traded in the company's shares shortly before the announcement of favourable sales figures.