25.5.2023
EN
Official Journal of the European Union
C 184/105
— more standardised prospectuses, easier for supervisors to scrutinise. 2.7.
In compliance with the environmental, social and governance-focused (ESG) policy objectives, the Listing Act would seek to ensure that companies issuing ESG bonds include ESG-relevant information in the listing documentation to make it easier for investors to assess the validity of the ESG claims.
Companies issuing equity will be able to refer to the already published — and hence publicly available — ESG information in the listing documentation.
3.
General comments A case for improved access to listing on European public markets 3.1.
The EESC maintains the view that increased equity funding for European companies is key in order to ensure lasting post-COVID-19 recovery as well as to building a resilient European economic system in the face of Russia's ongoing war against Ukraine.
For that, financial market infrastructure is essential in order to unlock the investment flows needed to recapitalise the economy. 3.2.
Highly developed public markets are also important for the retail investment community.
Europeans keep EUR 11 trillion worth of currency and deposits in their bank accounts (3).
The share of deposits in total assets of households is three times more than for households in the USA.
By failing to activate end-investors to channel their funds into European capital markets, the EU is not taking full advantage of its pools of capital for our companies.
Asset managers should gain more confidence in European equity market prospects, and European retail investors should have more choices when it comes to building their portfolios.
To achieve that, it is necessary to ensure that a diversified supply of high-quality issuers become listed on European public markets. 3.3.
During times of corporate financial distress, of economic unpredictability, and in particular of rising debt costs, equity acts as a stabilising factor and a buffer against future shocks. 3.4.
The Committee also notes that equity financing from European households to European corporations helps to ensure the EU's open strategic autonomy at the very basic level: ownership of assets and execution of corporate control.
The loss of essential European companies to foreign control, especially in the sphere of influence of countries with values that differ from Europe's, poses considerable risk to the economic and political stability of the EU.
It also hinders the development of the EU-based financial system inside the EU, oriented towards the EU's needs.
For instance, financial trading in the EU remains dominated by non-EU investment banks (4). 3.5.
Young and innovative businesses standing at the forefront of the green and digital transitions should be encouraged to seek listing on European equity markets and get much-needed financing by issuing publicly traded shares, as this is the most sustainable way to help these companies exploit their full creative potential and create jobs. 3.6.
An inflationary surge leads to increased appetite for equity investments, especially among savvy retail investors.
European equity markets may become a place where these investment inflows go to the key economic sectors where companies generate sufficient returns.
At the same time, the Committee is of the view that it is crucial for the EU to get sound and robust trading rules to realise the full potential of EU capital markets.
The lesson from the financial crisis showed that the EU must protect markets with fairness, integrity, resilience and transparency, also ensuring the highest level of investor protection. 3.7.
An analysis conducted in 14 EU Member States showed that up to 17 000 large companies are eligible to list but are not seeking to do so (5).
The Committee sees a risk that if the EU fails to encourage new listings in equity markets, our capital markets may see trade dwindle as investors diversify their portfolio globally, if there is not a sufficient offer of titles to invest in within the EU. 3.8.
A new generation of Europeans are entering the retail investment market with sustainability (i.e. ESG-based factors) on their minds.
At the same time, many economic agents are moving towards green goals, encouraged by the European Green Deal policies.
The EESC sees this combination of factors as a potential strong driver to unlock the full potential of the
(3) (4) (5)
Eurostat — Statistics explained.
ESMA annual statistical report ‘EU securities markets’, 2020; p. 40.
Oxera report Primary and secondary equity markets in EU, 2020.