Authors
Authors
Michael Kwan (Resource Law LLC)
The New York Stock Exchange (NYSE) is the world’s largest stock exchange. The Singapore Exchange (SGX) is one of Asia’s leading, internationally focused multi-asset exchanges.
On 22 July 2022, the exchanges signed an agreement to collaborate on:
- dual-listing companies on both exchanges;
- identifying and developing new environmental, social and governance (ESG) products and services;
- supporting index product development; and
- exploring new exchange-traded fund (ETF) products.
The collaboration seeks to create a connected ecosystem to facilitate access to capital and the development of new investment products and solutions to address the varied needs of market participants as they evolve and grow in complexity.
Dual-listed companies
- can expect better price-discovery, single-market volatility hedging, and round-the-clock trading;
- are able to tap into wider pools of capital, in key markets outside of their home regions;
- are able to access a greater spread of investors, both institutional and retail; and
- enjoy greater profiling and research coverage.
SGX recently welcomed the listing of NIO, a leading company in the premium smart electric vehicle market, now triple-listed on NYSE, SGX and the Hong Kong Stock Exchange. This follows the listing of AMTD International, a comprehensive financial services conglomerate in Asia, which is today dual-listed on NYSE and SGX.
The collaboration also encompasses ESG and ETF developments and initiatives
SGX has been actively rolling out ESG measures in its commitment to sustainability, including mandatory sustainability reporting since 2016 and the introduction of climate reporting from FY 2022. In line with ever-growing investor interest in ESG reporting and sustainable practices, SGX welcomed the listing of Lion-OCBC Securities Singapore Low Carbon ETF in 2022, bringing total assets under management of sustainability-linked ETFs listed on SGX to over S$700 million. Earlier in 2022, SGX welcomed NikkoAM-StraitsTrading MSCI China Electric Vehicles and Future Mobility ETF, a Chinese electric vehicles ETF offering investors access to the largest market for one of the world’s fast-growing industries. The SGX-NYSE collaboration is expected to bring online further products in this area, and to align and refine international sustainability reporting standards and practices.
The collaboration is an important milestone for both markets, and a very much welcome development. Issuers can look forward to tapping into the unique strengths of both exchanges, and investors and market participants can expect a wider range of green investment choices. For further information, please do not hesitate to reach out to any of our partners or the authors named below. Our global capital markets practice spans leading jurisdictions such as New York, Singapore, London and Hong Kong, and works seamlessly around the clock to advise listing aspirants, issue managers, underwriters and other capital market participants on listings, fund-raising and post-listing regulatory compliance.
Reed Smith LLP is licensed to operate as a foreign law practice in Singapore under the name and style, Reed Smith Pte Ltd (hereafter collectively, "Reed Smith"). Where advice on Singapore law is required, we will refer the matter to and work with Reed Smith's Formal Law Alliance partner in Singapore, Resource Law LLC, where necessary.
Client Alert 2022-191
Authors
Authors
Michael Kwan (Resource Law LLC)