Probes up, breaches down in NZX report

Stockmarket operator the NZX has released its first in-depth report into how it investigates complaints and enforces rule breaches for listed companies and those who trade on New Zealand’s sharemarket.

The NZX oversight and engagement report shows the exchange undertook 256 investigations last year — up from 234 in 2015.

More than half of the investigations (149) related to issuers — companies which list debt or equity on the market, with the biggest area of concern around continuous disclosure. Listed companies must ensure they inform shareholders of any information which may materially impact the company.

Almost 40 per cent of issuer investigations related to continuous disclosure with a further 24 per cent linked to companies not releasing administrative information.

Joost van Amelsfort, NZX head of market supervision, said the high number of investigations reflected its focus on continuous disclosure.

But while investigations had gone up, breaches had gone down.

“That shows the benefit of [ the] engagement with the market we are having.”

The NZX releases it regulatory metrics throughout the year and must give an annual report to the Markets Disciplinary Tribunal.

But van Amelsfort said this report was about giving market players more insight into how its enforcement team worked. The report noted the NZX’s regulatory arm would this year focus on the timing of announcements, the treatment of developing information and how issuers manage market expectations.