Corporate governance and corporate finance

Challenges and Prospects for Large Investors in the Middle East and North Africa Region


12 October 2012, London

Investor engagement and activism is nascent in the Middle East and North Africa region. While globally, individual investors and investor associations have been actively liaising with companies to communicate to them their expectations and any potential disagreements, this practice has so far not taken root in the region. Investor associations are not active in the region and have not been influential in lobbying for better corporate governance practices, and a result, there is a view among corporates that adopting better governance practices is only a matter of regulatory compliance.

On the other hand, stock exchanges and securities regulators in the region are facing significant challenges in attracting stable portfolio investment to local markets, especially in recent years which have seen low levels of liquidity and listings. These concerns are often voiced by heads of stock exchanges and securities regulators participating in the OECD Taskforce of Stock Exchanges which aims to provide a platform for regular technical dialogue among Arab exchanges on issues of priority.

Given their first-hand experience in MENA markets, investors are best positioned to provide feedback on strategic and technical issues facing them in investing in companies listed on Arab exchanges. With this in mind, the OECD organised a first consultation hosted by Hermes with large private and institutional investors in MENA markets on 12 October, 2012 in London. This consultation underscored an active interest in the establishment of a regular platform – the MENA Investor Council – to act as a venue for regular discussions and collaboration among large investors.




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