When the AIM is growth does effective governance matter?

London has long been seen as a premium market for listing, with a rich list of investors creating deep liquidity; but is the AIM market damaging its credibility?

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In a recent Times article the opening paragraph stated that having been hit by scandals, such as Langbar International and more recently Quindell, “the Alternative Investment Market is staining the reputation of the London Stock Exchange”.

ShareSoc, the shareholder rights group, claimed that the “reputation of AIM actually puts off good quality companies from listing on it”. Roger Lawson, deputy of ShareSoc, has called for a new governance code, enhanced disclosure and stricter policing of existing rules.

In response, The Times quotes a London Stock Exchange spokesman rejecting the claims, saying that it was a “successful growth market...the AIM rules are similar or in excess of requirements for companies on other major exchanges…”

  • Does less regulation lead to a lack of disclosure and transparency?
  • As a result is the AIM market more open to fraud and market abuse?
  • Is this in turn hurting companies when it comes to building trust with their stakeholders?  

We all know that investing is about risk and reward. With early stage companies this risk can be significantly higher. Although the rules governing AIM are less stringent than those on the main market, the same fundamentals apply in order to achieve good corporate communications. The advent of MiFID II will arguably make this message even more important, as companies compete to make sure that their story is being heard, and stands out from the rest.

As an AIM company how will you make sure you stand out from the crowd as a trustworthy company, with strong governance and a sustainable future?

If you would like to know more get in touch with us, or call Michael for a chat on 0121 309 0031