NZSE boss needs to show teeth - market commentators

By NZPA

Thursday 6th June 2002

Market watchers hope new stock exchange boss Mark Weldon has enough spine to inspire investor confidence by whipping a "toothless" bourse into shape.

Shareholders' Association chairman Bruce Sheppard said today it was crucial for Mr Weldon to change the monitoring and enforcement of market rules from a "slap with a warm wet towel to a bite from a pit-bull".

"The first thing Mr Weldon has to do is make a clear statement that listing rules will be reviewed and made more robust in line with our international peers," Mr Sheppard said.

"And where there are breaches there has to be rigorous enforcement with serious consequences.

"If he does that, on the back of government initiatives like the takeovers code and the Securities Commission and insider trading reviews, he will reinforce actions to regulate what is a Wild West stock market.

"Therefore he needs to turn with the tide instead of swimming against it."

Mr Weldon, a 34-year-old New Zealander, has arrived from McKinsey & Co in New York where he was a senior adviser on strategy to chief executives and large companies.

He is also know for swimming for New Zealand at the 1992 Barcelona Olympics and the 1990 Auckland Commonwealth Games.

Another market commentator, who declined to be named, said share price inquiries needed to be more rigorous.

"A continuous disclosure regime like Australia (has) is crucial," the commentator said.

"That means if a company has market relevant information it has to be released to the market."

He agreed with Mr Sheppard that stiff penalties were needed for breaches of exchange regulations.

"If you started throwing a few people in the slammer for breaking exchange rules you'd see a dramatic change for the better and more mum and dad investors would be putting money into the market."

Mowbray Collectables chief executive John Mowbray said yesterday Mr Weldon's biggest challenge would be "curing the apathy of New Zealand investors".

Mr Weldon was an "inspired choice", Mr Mowbray said, but he had to find a way to rekindle investor interest, which had still not recovered from the 1987 crash.

"He has to encourage more New Zealanders to realise that the New Zealand exchange is worthy of investing in," he said.

"He's just got to instil some confidence, but not just in the top 10 companies. Make it easier for people to understand how the exchange works and how to approach a broker, reduce those barriers to the average man in the street."

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