UK financial watchdog plans listing reform

The Financial Conduct Authority (FCA) has announced proposals to reform the way companies list in the UK.

The UK financial watchdog said that the move, which would represent the first change to rules since the 1980s, could help attract more “high quality” growth companies to Britain.

If the new rules were made official, businesses that wish to list in the UK would no longer need to choose between two segments with different branding and standards.

Instead, the regulator says that all listed companies would need to meet one set of criteria, and could then choose to opt into a further set of obligations.

The FCA said that these obligations would be focussed on enhancing shareholder engagement and would be overseen by the organisation.

“The rules for companies who want to list here have not changed since the 1980s,” said Clare Cole, director of market oversight, FCA. “Now is a good time to have an open conversation to make sure our rules are fit for the future, so we have a more accessible, competitive and growing market that is attractive to a diverse range of companies.”

In 2021, the FCA lowered free float levels, allowed certain forms of dual class share structures, and introduced digital financial reporting.

The organisation says these changes promote broader access to listing for a wider range of companies at an earlier stage in their development and "help investors use data faster to improve decision-making".

According to the regulator, last year was the best year for raising investment for listed companies since 2007.

Overall, £16.9 billion was raised in UK Initial Public Offerings (IPOs) including 126 companies listing on the London Stock Exchange.

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