A survey by Deutsche Numis reveals that the British government should focus on simplifying corporate governance requirements and encouraging pension funds to invest in local stocks to enhance the appeal of the UK’s capital markets. Regulatory changes are also a priority, as highlighted by over 150 executives and directors from London-listed companies. Despite efforts by both the previous Conservative government and the newly-elected Labour government, FTSE leaders demand more assurance of imminent significant changes.
The survey, conducted around July’s general election, points out that executive compensation is crucial for attracting more IPOs to London, with 43% advocating for a more competitive pay environment. Although median CEO pay in London has been rising, it still lags behind New York. Experts note a shift in the UK’s pay culture, with companies increasingly willing to confront investor dissent to retain talent.
A substantial 87% of respondents consider the UK an attractive market for listing or raising capital, particularly in light of recent reforms by the Financial Conduct Authority, which have made it easier for foreign issuers to list in London. Encouragingly, only 1% strongly disagreed with London’s competitiveness, according to Ross Mitchinson, co-CEO of Deutsche Numis.
London has faced a scarcity of IPOs recently alongside the migration of locally listed companies to New York. However, 42% of those surveyed anticipate a dramatic increase in IPOs within the next 24 months, and 92% foresee more foreign issuers listing in London. Discussions with private equity and international businesses suggest renewed interest in London following new listing rules.
Companies considering London listings include Vivendi SE unit Canal and Greece’s Metlen Energy & Metals. Liverpool-based Applied Nutrition is also planning a domestic float. Despite this optimism, only 16% of respondents believe that London can dramatically improve its investment appeal, down from 41% a year prior, suggesting that FTSE leaders feel London’s attractiveness might have peaked.
Numis concludes that while the outlook remains positive, a drop in optimism reflects concerns about the limits of London’s market appeal improvements.
Original Story https://www.livemint.com/news/london-executives-call-for-governance-pensions-revamp-to-lure-more-ipos-11727133443550.html
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