Unith Ltd Faces Governance Scrutiny After Closed Period Trade

Background to the Breach

Unith Ltd (UNT), a financial services company listed on the ASX, has recently come under scrutiny after a director traded company securities during a period defined as 'closed' under its own trading policy. The trade, which occurred on 15 July 2025, was initially reported as compliant with the policy in an Appendix 3Y filing. However, subsequent ASX inquiries revealed discrepancies in the interpretation and application of the policy.

The director involved, Scott Mison, Executive Director and Company Secretary, disclosed that while he sought and received verbal clearance from the Chairman to trade during this period, he failed to obtain the necessary written approval. This oversight technically constitutes a breach of UNT’s trading policy, despite the trade being ratified by the board in a meeting held on 25 July 2025.

Policy Ambiguities and Governance Gaps

UNT’s trading policy, originally lodged in January 2015, contains ambiguous language and incorrect clause references regarding prohibited trading periods. The director acknowledged misreading the policy’s definitions, which contributed to the misunderstanding. Furthermore, the policy approved by the board in August 2015 appears not to have been lodged publicly, adding to the confusion.

The company is currently undertaking a comprehensive review of its trading policy to clarify these ambiguities and ensure stronger compliance mechanisms. This review is part of a broader corporate governance update, which includes improved communication protocols with directors and staff to prevent future breaches.

Regulatory Compliance and Market Implications

Despite the breach, UNT has confirmed it remains compliant with ASX Listing Rules, particularly continuous disclosure obligations under Listing Rule 3.1. The company has assured the ASX that the responses to the inquiry were authorized by the board and that it is committed to transparency.

While no disciplinary actions have been announced against the director, the board’s decision to focus on policy reform and enhanced governance signals a proactive approach to risk management. Investors and market watchers will be keen to see how these changes are implemented and whether they restore confidence in UNT’s governance standards.

Looking Ahead

Unith Ltd’s case highlights the challenges companies face in maintaining robust insider trading controls and the importance of clear, accessible policies. As the company updates its trading policy and governance framework, stakeholders will be watching closely for signs of strengthened oversight and adherence to best practices.