Financial, Capital Markets in Italy and Europe, Structural Weaknesses, Revamping
The structural weaknesses of the European capital market and the urgency of bold intervention e complete for its reform are at the center of the European political agenda.
Analysis and proposals by Assonime
The Report of the Assonime Council Working Group addresses these issues through an empirical and structural analysis of the European and national market, formulating a set of recommendations aimed at European and Italian policy makers.
The European capital market has some structural weaknesses, such as its small size, low liquidity and persistent fragmentation, which negatively impact growth and innovation, with low levels of capital raising on the market from both new and incumbent companies, and stagnating economic growth and productivity.
The same problems are manifesting themselves, with an even greater effect, on the Italian market, where the wave of delisting and forum shopping is causing a substantial impoverishment of the ecosystem.
The Report formulates a set of recommendations, addressing Italian and European policy makers.
At a national level, the recommendations indicate a series of interventions necessary to promote the development and competitiveness of the domestic market through:
(i) the elimination of the still numerous cases of golplating and the prevention of the creation of this phenomenon in the future;
(ii) the alignment of national regulations with international best practices;
(iii) the liberalization of the process of appointing and composing the board.
At the European level, the recommendations develop a package of interventions for the creation of an effective Capital Market Union. Also taking into account the indications provided by the Draghi and Letta Reports, the Assonime Report requires:
(i) attribute to ESMA the power and the status of the sole and independent European supervisory authority, through an adaptation of its governance and related intervention powers;
(ii) create an effective “Single Rule Book”, through a progressive transformation of European legislation into directly applicable Regulations;
(iii) improve the European legislative process through the introduction of a series of so-called interventions. “better regulation”.
Finally, the Report outlines a road map for the future. In fact, the proposals contained in the Report do not exhaust the issues that must be addressed for an effective reform of the capital market, which would require simultaneous action on multiple fronts, both on the demand and supply sides. In particular, it is necessary to carry out further reflection on measures that could encourage:
(i) the mobilization of Italian savings, primarily institutional investors, towards Italian companies;
(ii) the participation of pension funds in the capital market;
(iii) research coverage of smaller firms.
June 11, 2025
Source Assonime
Association of Italian joint-stock companies
