SEC urges state-owned enterprises to list on NGX

The Securities and Exchange Commission (SEC) has urged State-Owned Enterprises (SOEs) to list their securities on the Nigerian Exchange (NGX).

This move the Commission said aligns with President Bola Tinubu’s “Renewed Hope” agenda, which emphasizes economic inclusiveness, democratization of businesses, and wealth creation for Nigerians.

In a statement issued on Thursday, the Director General of the SEC, Dr. Emomotimi Agama, noted the importance of SOEs listing their securities, emphasizing that it would lead to a more inclusive and democratized business environment.

Dr. Agama explained that such a development would not only spread ownership of these enterprises but also foster collective responsibility for the growth of Nigeria’s industries.

According to Dr. Agama, listing State-Owned Enterprises on the NGX would facilitate wealth distribution among Nigerians and democratize the operations of these companies, allowing more individuals to take ownership stakes in them. “Inclusivity is very critical,” Dr. Agama said. “Because in inclusivity, you have ownership, and so we all build our industries and the country together.”This approach is seen as a step towards deepening public participation in the capital markets while simultaneously advancing the country’s broader economic agenda. The SEC’s Director General made it clear that the Commission is ready to provide incentives and create an enabling environment to encourage these enterprises to list. The idea is to make the listing process attractive by offering favorable conditions that drive the decision-making process within SOEs.

One key concern often raised by managers of SOEs is the fear that listing their enterprises might lead to a loss of control. However, Dr. Agama dispelled this notion, emphasizing that the listing of companies on the exchange does not strip managers of their power. On the contrary, it strengthens the organization by promoting unity and collective growth. “Listing of those institutions does not remove power from them. It rather provides bigger power, because united we stand, divided we fall,” Agama said.

By inviting public participation through the stock exchange, companies stand to gain access to more capital, improve their corporate governance, and enhance transparency. These benefits can, in turn, boost their long-term growth prospects and competitiveness.

Another critical aspect of the SEC’s strategy is to streamline the listing process. Dr. Agama disclosed that the Commission is working on reducing the time to market for companies planning to list. This would provide a clear and predictable timeline for SOEs and other firms to follow, ensuring they have the certainty and confidence needed to go public. “Providing that certainty, getting them the assurance, knowing fully well that when you want to come to the market, you are able to follow a calendar, and that calendar is supported by the SEC,” he said.

The SEC’s commitment to reducing bureaucratic bottlenecks and creating a seamless listing process is aimed at attracting more SOEs and private companies to the NGX, thereby expanding the Nigerian capital market’s scope and depth.

Dr. Agama also emphasized the SEC’s dedication to leveraging technology to make the capital market more accessible, particularly for younger generations. The Director General explained that the use of financial technology (FinTech) tools and digital platforms would simplify the investment process and make it more attractive to a broader audience.

“That is why we encourage apps, we encourage FinTech tools, and that is why we supported the launch of the e-offering platform at the Nigerian Exchange,” Dr. Agama said. He encouraged other stakeholders to embrace innovative technological solutions that can transform how people perceive and engage with investments. The e-offering platform, launched by the Nigerian Exchange, allows for easier and more efficient participation in public offerings, enabling a wider pool of investors to participate in the capital market.

Dr. Agama’s vision for the future of Nigeria’s capital market includes creating an enjoyable and seamless experience for investors. “We want investors to have a beautiful experience,” he stated. “We want them to feel at ease, to make it so easy for them that each time they feel like investing, it brings happiness to them.” By fostering a positive investment environment, the SEC hopes to encourage more people to invest in Nigerian businesses, thus driving economic growth.

The Commission’s strategy involves a combination of education, technology, and incentives to rejuvenate the Nigerian capital market. Through targeted education programs, the SEC aims to demystify investment processes and promote financial literacy, ensuring that a broader segment of the population understands the opportunities available in the capital markets.

In its broader efforts to rejuvenate the capital market, the SEC is focused on removing barriers to entry for companies and industries that may be considering listing. By streamlining processes and offering incentives, the Commission seeks to make the Nigerian capital market more competitive and attractive to both domestic and international investors.In addition to promoting the listing of SOEs, the SEC is also encouraging other sectors of the economy to participate in the capital markets, particularly through innovative approaches such as FinTech. By doing so, the Commission aims to create a more dynamic and diversified market that supports the growth and development of Nigeria’s economy.

SEC urges state-owned enterprises to list on NGX - The Nation Newspaper (thenationonlineng.net)