Saudi Arabia’s Tadawul stock exchange chief pledges more reforms

Sarah Al-Suhaimi outlined changes made at Tadawul including a new system of share settlement. (Courtesy of FII)

RIYADH: Sarah Al-Suhaimi, the chairperson of the Tadawul stock exchange, has committed the Riyadh market to further reform and modernization in an effort to ensure inclusion in global investment indices as soon as possible.
Speaking at the Future Investment Initiative (FII) in the Saudi capital, she said that there was “more to come” from the Tadawul’s expansion program, in particular plans to introduce a clearing house for derivatives trading and a plan to cross-list stocks with other Gulf and international exchanges.
“We want to encourage everyone to invest in Saudi Arabia, and we are continuously changing to make this easier,” she told Howard Marks, chairman of US investor Oaktree Capital, at the FII.
“We have already introduced very necessary changes, and the results are showing with Tadawul on the watch list for inclusion in the MSCI and FTSE Russell indices,” she said.
One of the leading female business leaders in the country, she also outlined the changes already introduced at Tadawul to broaden its international appeal, including opening the exchange to foreign investors and introducing a more efficient system of share settlement.
The plan to cross-list with other Gulf exchanges could be an important move as the Kingdom seeks to develop its capital markets.
The Tadawul is the biggest exchange in the region and ranked 26 in the world in market capitalization, but has suffered from what some investors regard as a lack of liquidity and transparency in comparison with markets in other countries.
She also spoke of the need to get women more involved in the financial industry and used her own career as an example. “I began at Samba and faced small challenges that nobody wanted to do. But we used to dream big and we met those challenges.
“Today, endless opportunities exist in Saudi Arabia for women, who have more support. They can do much more for themselves in the country,” she added.
“What I want to tell young women is if you find a challenge in a field that you like, just do it, even if you think you can’t succeed. I know they can.”
The Tadawul chief also touched on Saudi Aramco, the oil company which is planning an international public offering next year on the Tadawul and possibly another big international exchange.
“Aramco is one of the biggest talent factories in the Kingdom, with established practices and cultures allowing young people to develop,” she said.
She added that Tadawul was to launch a series of roadshows in a bid to attract big institutional capital.