NZX has complied with its licensed market operator obligations, a review by the Financial Markets Authority (FMA) – Te
Mana Tātai Hokohoko – has found.
The annual NZX Market Operator Obligations Review, released today, assesses how well the NZX is meeting the requirements for its market operator licence. The report found NZX met all
its obligations during the review period from 1 January 2023 to 31 December 2023.
In particular, the review found:NZX’s governance arrangements continue to be appropriate and support its ability to comply with its licensee obligationsNZX and NZ RegCo – NZX’s regulatory function – continue to improve its frameworks, processes, and operational
effectiveness across the areas assessedContinued demonstration of NZ RegCo’s operational independence, while maintaining an appropriate and effective working
relationship with NZXSignificant work and investment in technology resources over the last three years has resulted in the business being
much better positioned with respect to capability, resilience and securityFurther enhancements in the risk management frameworks, ownership, identification, management and mitigation of risk,
and delivery of assurance activity.
The report has made two recommendations. The first recommendation is to consider how NZX can further address its dependency on the resilience of participants and providers regarding the
overall stability of the ecosystem. The second recommendation is for NZX to continue to improve crisis management scenario testing by considering testing a system being
unrecoverable.
FMA Director of Markets, Investors, and Reporting, John Horner, said: “This year’s report shows NZX continues to improve
its systems and processes, particularly in key risk areas such as technology and security. NZ RegCo operates in a
structured and considered way, with a clear strategy to achieve its outcomes. The FMA encourages NZX to build on the
improvements with a focus on the two FMA recommendations on participant resilience and crisis management.”