Shareholders in a company once chaired by Senator Arthur Sinodinos were not made aware of his salary or the firm's finances, the New South Wales corruption watchdog has been told.

Senator Sinodinos stood down as assistant treasurer on Wednesday over the inquiry by the Independent Commission Against Corruption (ICAC) into Australian Water Holdings (AWH).

The senator was on the AWH board until he resigned to enter Federal Parliament in 2011.

AWH shareholder Anthony Karam took the stand to tell of his $500,000 investment in the firm.

"You're a savvy investor, aren't you?" junior counsel assisting ICAC Greg O'Mahoney asked.

"Well I'm not if I'm here, am I?" Mr Karam replied.

Mr Karam told the inquiry he has had no financial return from his investment and that company financial records have been withheld from him.

As a result Mr Karam said he joined other AWH investors in a Federal Court case to sue the company and its directors.

Mr Karam told ICAC he was first asked to invest in AWH while having breakfast with his old school friend Eddie Obeid Jnr, the son of former Labor powerbroker Eddie Obeid, in 2007 near the Obeid family's offices at Birkenhead Point.

ICAC heard Mr Obeid Jnr told Mr Karam that their mutual school friend, Nick Di Girolamo, was in charge of AWH.

Mr Karam was later led to understand that AWH could be worth up to $200 million from a public-private partnership with Sydney Water.

He said he was promised that the return for his investment would double in 12 to 18 months and, at first, he was relaxed about the investment because he knew Sydney Water was reimbursing some of AWH's costs.

But Mr Karam said he became concerned when he did not get financial information from AWH when he asked for it.

'Majestic' stature of Sinodinos restrains investor questions

Another AWH investor, Rod de Aboitiz, told the inquiry he put $1 million into the company and also had had no return.

Mr de Aboitiz said, given the situation, big salaries for AWH executives and fees for lobbyists did not make sense to him.

He said the board members were experienced businessmen "aware of the Corporations Act" and he should not have been telling them how to "suck eggs".

Mr de Aboitiz said at one point he was angry with Mr Di Girolamo, who was also a fundraiser for the Liberal Party's NSW division.

The investor took his concerns to Mr Di Girolamo's fellow board member, Senator Sinodinos, telling him that AWH needed to get its finances under control.

But Mr de Aboitiz said at the time he was somewhat in awe of Senator Sinodinos because of his "majestic" stature.

He admitted he was not aware of the complete breakdown of the terms of Senator Sinodinos's remuneration when the 57-year-old was made chairman in 2010.

ICAC alleges that Senator Sinodinos was paid $200,000 a year by AWH, plus bonuses, for about 100 hours' work and stood to make up to $20 million from the deal between AWH and Sydney Water.

The commission is investigating allegations AWH signed an agreement with Sydney Water to project manage infrastructure but corruptly billed Sydney Water for expenses.

AWH is accused of using the money to pay exorbitant executive salaries and as donations to the NSW Liberal Party.

The Liberal Party indicated earlier this week that it would be repaying the more than $75,000 received in "tainted" AWH donations to Sydney Water.

Current and former AWH directors including Senator Sinodinos, Mr Di Girolamo and former NSW Labor treasurer Michael Costa are being sued for deceptive conduct.

Senator Sinodinos maintains that he has done nothing wrong and Prime Minister Tony Abbott predicts he will return to the frontbench "soon".

The inquiry continues.