This article seeks to inform stakeholders within Australian universities of some of the risks and opportunities to make better use of information in their governance processes relating to research commercialisation so as to capture a greater proportion of the profits generated by floating research companies on the Australian Stock Exchange. This article applies agency theory to argue that several internal incentive structures, information asymmetries, and decision-making processes within the governance systems of the University of Melbourne led to the university receiving a significantly smaller proportion of the overall profits from the float of MelbIT than it otherwise could have achieved. It also argues that the failure to disclose adequately to the investing public the existence of sales contracts signed by MelbIT before the closing date for subscriptions to the initial public offering of the company may have amounted to a breach of the Corporations Act 1989 (Cth), which was in force at the time. It offers valuable insights for senior managers in Australian universities who may find themselves in similar circumstances in the future.
Dr John Selby, LLB (First Class Honours, University Medal), PhD (UNSW), BInt Bus. (Griffith), Grad Dip in Legal Practice (NSW College of Law), Grad Dip in Arbitration (UQ), Lecturer in the Department of Accounting and Corporate Governance, Macquarie University.
© 2012 Journal of Law, Information & Science and Faculty of Law, University of Tasmania.