Abu Dhabi Securities Exchange (ADX) today urged its listed companies to adopt internationally recognised investor relations practices that would not only improve a company’s communication with its shareholders but also encourage more committed long-term institutional investors to enter this market.
Speaking at a workshop, jointly hosted by ADX and Hermes Equity Ownership Services, Tom Healy, Chief Executive of the Exchange, said that “excellent investor relations are essential to listed companies across the world, no matter which cultural or political environment they operate in.
“The most important principle of good investor relations is transparency. Companies have an obligation to communicate clearly with their investors to ensure they make their decisions based on fact and analysis, not rumour.”
Mr Healy also explained how investor relations practices can be applied to encourage a certain type of shareholder. Many companies for example would benefit from having long-term, institutional investors instead of just being dominated by private investors:
“By employing a dedicated investor relations practitioner who can market a company to those investors, this can be achieved,” he said. “Institutional investors tend to be more committed and long-term in their investment outlook”, he continued. “In order to develop sustainably, the UAE markets need more of a balance between these investors and the individual investors who currently dominate our market.”
The workshop was attended by Chief Executives, Chief Financial Officers, Investor Relations Managers and other representatives from a number of ADX listed companies. In addition to hearing from Tom Healy and Rashed Al Baloushi, Deputy Chief Executive of ADX and Paul Lee, Director of Hermes Equity Ownership Services, attendees were also addressed by Maryam Al Suwaidi, Director of the Issuance and Disclosure Department at the Securities and Commodities Authority, and David Higgins, a Partner at international law firm Freshfields Bruckhaus Deringer.
This workshop is the latest in a number of initiatives ADX has taken recently to encourage investor relations best practice and to improve transparency. Earlier this year, the Exchange signed an agreement with Thomson Reuters to promote the benefits of investor relations principles to its listed companies.
