Murder on the City Express - Who is Killing the London Stock Exchange's Equity Market?

In Agatha Christie’s Murder on the Orient Express, Poirot deduced that no single culprit was responsible for a murder on the eponymous train. In this article, which is intended to serve as an aide memoire to assess anticipated reforms, we similarly reason that there is no single suspect responsible for a recent decline in fortunes of the London Stock Exchange’s equity market. We note that globally-relevant factors, such as the rise of private capital, may have impacted the health of the U.K.’s primary stock market. However, sufficiently material differences in various stock market metrics exist between the London Stock Exchange and stock markets elsewhere to suggest that U.K.-specific factors are also significant. We canvass several of those factors: Britain’s listing requirements and corporate governance regime, a paucity of public company investment research, the withdrawal of U.K. pension and insurance firms as public company investors, a U.K. investment culture that prioritises dividends over growth, a lack of world-leading British corporations, and managerial shortcomings. We suggest that all of these factors likely have contributed to the U.K.’s equity market travails, a finding which implies that generating effective reforms will require coherent and expansive policymaking.