The National Co-ordinator, Proactive Shareholders Association of Nigeria, PSAN, Mr. Oderinde Taiwo,  in this interview with Vanguard spoke on issues bothering on the compulsory listing of multinational companies on the Nigerian Stock Exchange, NSE; policies that government can initiate to turnaround the market especially at this period of economic recession and why companies do not list on the NSE, among others.

DO you support the compulsory listing of multinationals on the NSE? 

First, I do not support compulsory listing of multinational companies on the Nigerian Stock Exchange, because all over the world where there is perfect market, it is backed by the slogan of free entry and free exit policy. So, free entry and free exit are   allowed in any organised stock exchange all over the world.

Secondly, we are in the democratic era where things including business are done based on free will. While increased listing on the floor of stock exchange is good for the economy, to force private companies to list is unethical and smacks of dictatorship. Our regulatory bodies especially NSE and Securities and Exchange Commission, SEC should do an overview of their respective policies comparable to that of other countries and review them accordingly.   Some of the listing requirements on the NSE are not friendly to these multinationals and even local companies.

What is your view about multinational companies not wanting to list on the NSE?

I observed  that multinational companies are scared of listing on NSE because of the harsh economic climate of the country and the stringent listing requirements of the NSE. The global economic downturn is affecting the fortune of companies and therefore they prefer to remain a private entity till things improve

If the economic climate is conducive and favourable and incentives are provided, then you will see them come to the exchange.

•Oderinde Taiwo

Also, the stringent listing requirement of the NSE is not helping matters. So, all these things scare the companies to come to the exchange..

Another factor is the over regulation issues. Our regulatory bodies are becoming more unpopular due to over regulated requirements.   For example,  Financial Reporting Council of Nigeria, FRCN is a classical example that is becoming too powerful.  Companies are becoming afraid including the listed ones are contemplating of delisting from the exchange.

What do you think can be done to encourage companies to list on the exchange?

The multinationals and even the local companies in the country need attractive policies that will engender the growth of their businesses. These companies can be attracted to list on the NSE when incentives like tax holidays among others can be given to them, instead of placing too much demand on the listing rules requirements. Because  companies are scared of listing requirements of the NSE coupled with the harsh economic climate in the country they prefer to remain as private entity in their operations.

Do you support companies listing on multiple exchanges and why?

I do support multiple exchanges listing of companies because it makes the companies to become stronger.   For example,  when Lafarge had financial issue for their expansion some years back, they borrowed from their parent company to do it.

Access to international support and assistance is another opportunity for multiple listing of companies.   For example,  many Chinese companies are listed in some European countries and are now leveraging on such opportunities to remain solid.