05.12.2017

Keys to Nordic Nasdaq Success:100 SME Driven IPOs a Year

As investors are getting used to the Nordic miracle, Picking Alpha is interested in the components of it’s’ success and results which the democratization of the listing process have delivered to the investment community.  Adam Kostyal, Senior Vice President, Global Listing Services (EMEA) at Nasdaq has stressed that listings are open for a company that is well prepared, has a good governance structure, and fulfills the Nasdaq Nordic listings requirements.

“At Nasdaq Nordic we have two different market models.  We have the main market, which is quite substantial in it’s’ regulation.  We also have Nasdaq First North, our junior growth market designed for SMEs, which has more flexible requirements but then again the requirement level which is enough to make sure that we have quality companies.  It still provides the flexibility to the entrepreneur to be an entrepreneur and run the company in a flexible way, but with responsibility towards investors.  So if the company is ready to handle the public market, Nasdaq First North can be a perfect platform for continued growth

Ideally, the company should have a predictable business model, and be skilled enough in its communication to the investors.  We had 100 new listings this year, driven mainly by Small and Medium size companies.  And this is what makes it exciting about the Nordic market” – continues Adam Kostyal.

To walk the talk of Circular Economy, that the region is very famous for, Nasdaq Nordic is offering a very particular product – Nasdaq Sustainable bond list, which is a segment of the main market of Nasdaq Stockholm. To be eligible to list bonds on the Sustainable Bond List, Issuers need to live up to Nasdaq’s Green, Social or Sustainable Criteria. “We have seen a strong interest in it since it was launched in 2015, and we expect this trend to continue,” says Adam Kostyál.

“Nasdaq is also conscious about the responsibilities companies have.  “The Issue of Sustainability is no longer a nice addition to have, it is a must have,” says Adam Kostyál. “So the company should have a clear strategy in regards to sustainability reporting.  We, as an exchange have launched something called the ESG reporting guide – a voluntary support program on environmental, social & governance (ESG) disclosure to support listed companies in the Nordic & Baltic markets. We are currently in the process of launching a pilot program, where we invite 20 companies to use the guide and provide feedback back to us.” – explains Adam Kostyál.

He is not sure about the correlation of financial performance and sustainability performance, but he is certain that if you do not have a clear strategy around the sustainability you are limiting yourself in terms of accessing a broader investment pool.  “You have to be transparent, you have to be visible, you have to be advocating about that, because if you don’t you limit your opportunities to reach a broader investment pool. Investors are more and more focusing on Sustainable Investments now” – says Adam to conclude our interview.

In the video Adam Kostyál, Senior Vice President, Global Listing Services (EMEA) at Nasdaq answers the following questions:

  • What has brought Nordic Market to such a success?  Large Caps, Small/ Medium or the trending business models that are being listed?
  • Nordic Countries are among the leaders and drivers of Circular Economy.  What can you say about “Circular” Business Models on Nasdaq?  How are they performing?  (If at all?)

 

 

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