Accra, Feb. 7, GNA - The Ghana Stock Exchange (GSE) has initiated moves to get shareholders of listed companies on the bourse to form a strong umbrella association as a means of deepening understanding of operations of the market.

The move is part of the objectives of the World Bank supported Financial Sector Improvement Programme, which aims at deepening the capital market.

Attempts by some shareholders to form such an association in the past were unsuccessful because of the divergent interests of members. Officials of the Exchange said their decision to support the formation of the association was derived from the long-term benefits that the capital market stood to derive from it.

At a meeting in Accra on Wednesday to examine the proposals for the establishment of the association, shareholders who attended the meeting appointed a five-member committee and charged them with the responsibility to draw up rules and regulations that would lead to the registration of the association latest by the close of next month.

Mr Kofi Yamoah, Managing Director of the Exchange, said shareholders' understanding of the rules and regulations of the market was a first step in ensuring the long-term viability of the market and deepening of the investment culture.

He said enlightened shareholders could be big assets to the companies as they were likely to influence the direction of major decisions that could impact negatively on operations of companies and affect shareholder value.

They would also be better placed to help in the education drive of the Exchange to get more local investors to the bourse. "Shareholders are key instruments of success of stock exchanges in most emerging markets," Mr. Ekwow Afedzi, General Manager of the Exchange, told the Ghana News Agency.

He said in countries where there were powerful shareholders' associations, key decisions that could affect the performance or direction of companies were only reached through consultations with members.

Mr Djaba Nyakotey, a member of the committee, said a vibrant shareholder association would promote the integrity of the market, inform investors and put pressure on managements of companies to be transparent and accountable.

Mr. Sas George, an investor and a member of the committee, said the formation of the association was important in order to help educate members to understand their rights and to protect their investments. 07 Feb. 07