An Investigation of Hindrance Factors Preventing Companies from Listing on the LuSE

Abstract

Purpose: This study seeks to examine the underlying factors that hinder companies in Zambia from listing on the Lusaka Securities Exchange (LuSE), despite the advantages of going public. While stock market participation can significantly enhance access to capital, lead to improved corporate governance, and support long-term growth, listing activity on LuSE remains limited. This research aims to identify the core challenges and inform strategies to address them. Design/Methodology/Approach: A quantitative approach was employed, combining primary data collected through structured surveys administered to a diverse group of companies and capital market stakeholders, with secondary data from relevant institutional sources. Descriptive statistical analysis and thematic categorization were used to systematically identify and interpret the principal barriers to listing. Findings: The results highlight a confluence of economic, regulatory, organisational, and perceptual constraints that discourage firms from pursuing public listing. Key deterrents include the high financial and administrative costs of listing, burdensome regulatory compliance requirements, limited understanding of the listing process, concerns over potential loss of ownership and control, and an underdeveloped market ecosystem lacking sufficient investor participation and liquidity. Practical Implications – The findings offer valuable insights for policymakers, the Securities and Exchange Commission (SEC), LuSE authorities, and business leaders. By addressing these barriers, stakeholders can improve the attractiveness of public listing, stimulate broader market participation, and contribute to Zambia’s financial sector development. Originality/Value – This study fills a critical gap in the literature by providing empirical evidence on listing deterrents in Zambia, offering actionable recommendations for capital market reform in emerging economies. Keywords: Lusaka Securities Exchange (LuSE), Zambia, capital markets, listing barriers, stock market participation, financial inclusion, corporate finance.