| Major changes are coming in the management system of the New York Stock Exchange. Yesterday, during his speech to representatives of the association of professional financiers, the new head of the NYSE, John Reed, said that the board of directors of the exchange could be reduced by almost three times. Moreover, Mr. Reed himself does not intend to join it.
Currently, the NYSE Board of Directors consists of 27 members, including 12 directors - representatives of large companies operating in the securities industry. It has been said for a long time that the council is too big, has many privileges and is of little use. Many experts believe that an organization with the status of the NYSE should not include directors of the companies whose activities it regulates on its management team. The names of those who will be included in the “nine” have not yet been announced by representatives of the exchange. What is known is that the new board will retain two previous directors and six new ones will appear. “I can’t tell you how much pleasure I got from resigning,” Mr. Reed commented on his reluctance to become one of the directors. “I think it’s extremely important for the exchange that I come and go.”
At the meeting, clarity was also brought to another fundamentally important issue - how trading on the NYSE will be carried out in the future. Here, unlike many other exchanges, the sale and purchase of securities is still carried out by traders. In October, a scandal erupted when it emerged that five brokerage firms were trading among themselves before clients' orders were completed. The latter lost millions on this. After this, many hoped that the head of the exchange would make the long-awaited transition to a new system as part of the proposed reforms. It has now become known that Mr. Reed does not approve of such changes, citing the usefulness of such practices. “Computer systems find liquidity, but they do not increase the volume of that liquidity. And a system based on the human factor introduces capital into the system. All studies indicate its usefulness. I would prefer management by specialists to a computer-based system,” he said. Denis UVAROV
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