Governance Structures in African Securities Exchanges: Demutualization Theory, Conflict of Interest and Regulatory Challenges

Samuel O. Onyuma

2023년 10월 · Notion Press

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Demutualization is the transformation of a securities exchange governance structure from a mutual association of stockbrokers operating as not-for profit entity into a for-profit company accountable to its shareholders. It has become a widespread phenomenon – one with increasing appeal in developed markets. It challenges the traditional approach to regulation of securities exchanges and raises issues regarding their role in capital markets regulation. In spite of its popularity as a strategy for catalysing securities exchange development in emerging economies, its pace in Africa has been excruciatingly very slow. African securities exchanges therefore remain underdeveloped compared to their peers in other emerging markets. So, how can African securities exchanges facing the challenge of integration and better technical and institutional development address the problem of underdevelopment through demutualization? This book explains how demutualization can enable greater and swifter securities market development in Africa; the role government regulators should play in demutualization of exchanges in African countries; the right self-regulatory model applicable to African exchanges; effective management of conflicts of interest and other barriers to separation of ownership from management and trading rights; types of investments needed to enhance the effectiveness of African’s capital market; and how securities exchange demutualization can facilitate African countries destiny to become leading capital markets globally.

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Samuel Onyuma has been a faculty member at Egerton University in Kenya for fifteen years where he served as Chair of the Department of Economics and Business Studies. He later joined Laikipia University in 2013, where he teaches and supervises postgraduate students, and conducts research in the vast area of finance and financial markets. Currently, he is serving as the Director for planning and performance management. His research interest is in analyzing securities market efficiency, microstructure, governance structures, regulatory issues and development in emerging economies. Samuel has spoken at conferences on financial development, securities markets integration, regulation and corporate governance issues. He has authored five academic books, and published over fifty peer-reviewed journal articles on African securities markets. He consults widely for regional securities exchanges, financial regulatory agencies and international development organizations, including the World Bank.