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To maintain the quality of its list, the NYSE requires listed companies to meet original listing criteria and maintain continued listing standards that are among the highest of any market in the world. Meeting these requirements signifies that a company has achieved leadership in its industry in terms of business and investor interest and acceptance.
The Listed Company Compliance division comprises two components: Financial Compliance and Corporate Compliance.
Financial Compliance reviews a company’s reported financial results both at the time of joining the Exchange and throughout its listing to ensure that it meets original-listing and continued-listing requirements. Criteria include earnings, cash flow, numerical standards relating to distribution of a company's shares, trading volume, market value and share price, as well as other criteria. When a company falls below any criterion, the Exchange notifies the company and reviews the appropriateness of continued listing. Once notified, in many cases a company has the opportunity to submit a plan to return to compliance within eighteen months. If the Exchange accepts the plan, it monitors the company's performance throughout the plan period. If the company fails to achieve stated goals in a timely manner, the Exchange will move to suspend the security and remove it from the list. If the Exchange does not accept the recovery plan, it will move to immediately suspend the company’s security and remove it from the list.
Corporate Compliance ensures that listed companies adhere to the highest standards of accountability and transparency, including enhanced governance requirements for configuration of corporate boards, director independence and financial competency on audit committees. The Exchange has taken a leadership role in setting standards for corporate governance practices for over a century and has periodically amended and supplemented its standards with a constant focus on investor protection. The governance rules implemented in 2003 and 2004 empower independent directors as representatives of shareholders. They also require enhanced disclosure by listed companies so investors are fully informed with regard to the governance and ethics of companies in which they invest. |
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