Investor associations discuss the governance of stock exchanges with the WFE

The members of the Global Network of Investor Associations (GNIA) met in Milan with the CEO of the World Federation of Exchanges (WFE), Nandini Sukumar, to discuss the role of stock exchanges in fostering the capital markets’ governance practices. Representatives of the Italian and the Brazilian (B3) stock exchanges also participated in the discussion.
The debate about the listing of companies that do not follow the one share one vote principle and the role of the stock exchanges was very intense. Some members voiced their concern about a possible race to the bottom as the stock exchanges compete for the listings. The recent Alibaba, Snapchat and SaudiAramco cases guided the discussion.
The relationship between the stock exchanges and the capital markets’ regulators, the access of smaller companies to the capital market, the role of the stock exchanges in facilitating proxy voting processes and IPOs rules were some of the topics also addressed during the meeting.
Amec’s CEO, Mauro Rodrigues da Cunha, addressed the discussions the association has been having with the Brazilian stock exchange – B3.  Cunha believes that one of the problems that leads to the progressive deterioration of listing standards is the inability of perceiving the companies’ listing as a business. Despite the significant unbundling of the services offered by the stock exchanges, it is not possible to identify and price the advantages of a sound listing system that drives the adoption of best practices.