AusIMM Reports JORC Code Breaches
At the heart of the resource sector regulatory regime is the JORC Code and the role of the so-called competent person. AusIMM received 17 complaints in 2015 about how its members had conducted themselves as competent persons. Ten of the complaints involved allegations of AusIMM members failing to properly apply the JORC Code. There were seven complaints of unethical conduct including falsifying qualifications. Even a seemingly modest 17 complaints a year could quickly snowball over a short span of years into a disturbingly large number over whose work doubts have been raised. Investors are not told which wrongdoings are the most prevalent or what constitutes a serious enough offence to rile the body’s ethics committee. Nor are they told whether prior offenders are still influencing market decisions. Even 17 breaches seems implausibly low across hundreds of companies reporting multiple times in a year when departures from JORC Code requirements in documents lodged with ASX are commonplace especially in reports about the economic viability of projects. Competent persons routinely ignore JORC Code instructions to provide the information investors expect.
John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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