Firms in the Nordic capital markets are keen to harmonise and improve efficiency, but not at the expense of their local differentiators – this was the overarching observation of a white paper that put the spotlight on capital market trends in the region. Published by Broadridge in collaboration with Firebrand Research, the report also identified the transition away from legacy infrastructures, the futureproofing of systems, and ESG topics as current top-of-mind concerns for firms.
Nordic adoption of the Target2-Securities (T2S) system remains limited, with no institutions from Norway or Sweden on the platform yet. The paper predicted that this might soon change, noting that the Nordic markets are keen to keep pace with developments that standardise and modernise market structure. In addition to T2S, this includes shifting to T+1 settlement and even “potentially beyond”, “when it makes sense”.
When it comes to ESG agenda, the paper identified it as an area of strength and a key differentiator for firms in the region, “with emphasis on the ‘E’ and the ‘G’ especially”. Because of the region’s strength in this area, the report predicted “a continuing focus on shareholder support and engagement”.
In terms of futureproofing, the report pointed out that “financial institutions in the Nordic region have been a little slower to experiment with technologies such as distributed ledger in their home markets than some of their continental European counterparts”. It observed, however, that there is a “high degree of interest in the potential of technologies such as AI to generate new revenue streams, reduce efficiency, and modernise the landscape”.