London’s Global Reach and the Half a Trillion Dollars Equity Prize

36 Pages Posted: 7 Jun 2021

Date Written: February 5, 2018

Abstract

As the world’s leading international financial centre, London faces fascinating opportunities and significant challenges in coming years as a result of Brexit, increased international competition from other global financial centres, and the changing face of finance itself. The City should continue to take a proactive approach to maintain its position as the world’s number one financial centre. It is also vital London retains the listings it already has. One potentially vulnerable area is those major companies that have a dual listing – on London and on another exchange. There are seven of them: Unilever, Rio Tinto, BHP, Reed Elsevier, Carnival, Mondi and Investec with all but Investec in the FTSE 100. One way to safeguard this would be for the UK Listings Authority (UKLA) to be flexible in how it interprets its rules and in the messages it sends. In an environment of intense global competition, we explain that it would be to the benefit of London if the UKLA and FTSE Russell deploy appropriate levels of discretion to ensure flexibility and continued access to the UK markets and indices for key international companies. It is important London highlights its attractions, and this has to include being flexible on rules, such as listings. If the UK is to play a leading role in the global equity market village, it needs to continue to build on its approach of being an international index as this is the nexus for a wider wealth creating eco-system that a post Brexit UK should be seeking.

Keywords: UK, Britain, Brexit, London, financial services, finance, banking, investment banking, IPO, initial public offering, direct listing, globalisation, stock exchange, FTSE, UKLA, government regulation

JEL Classification: G18, G28, G38, G15, G24, G32, G34, G38, G20, L51, L16

Suggested Citation

Lyons, Gerard, London’s Global Reach and the Half a Trillion Dollars Equity Prize (February 5, 2018). Institute of Economic Affairs Monographs, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3853702 or http://dx.doi.org/10.2139/ssrn.3853702

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