There is a serious lack of Australian empirical literature on the effectiveness of insider trading regulations. This is due to the relative lack of relevant trading data compared to counterpart regimes (for example, the United States). Until recently, Australian corporate insiders were not required to disclose their interests in their company to the ASX. In an attempt to fill the literature gap, this article adopts the empirical approach of surveying a large sample of senior corporate insiders regarding their trading motives and attitudes in order to gauge the likely information content of their trades. A significant proportion of respondents indicated a propensity to time their trades based on inside information. The results have major implications for regulatory reform regarding insider trading and disclosure laws.

Securities markets regulations have two main objectives, to promote market efficiency and market fairness. This article demonstrates that the insider trading regulations in Australia and overseas have been fuelled by excessive reaction by politicians and regulators to the notion of fairness at the expense of efficiency. In Australia, this has caused the insider trading regulations to be too encompassing compared to the regulations in six other securities markets examined in detail. For example, given the facts, the recent committal to trial of a J B Were broker on insider trading charges is less likely to have occurred in the six other regimes. Also, Australia's continuous disclosure regulations are deliberately intertwined with the insider trading regulations, which is not the case for the six competing regimes examined. The intention of this article is to challenge regulators, law reformers and academics to reflect objectively on current insider trading regulations with a view to reform.