With the elevation of its listing to the NASDAQ Global Market from the NASDAQ International Designation program, Cronos Group’s (PRMCF)(CRON) management believes this listing “will increase long term shareholder value by improving awareness, liquidity, and appeal to institutional investors.”
The elevation to the listing under the Global Market program entails stricter regulatory requirements with the SEC (U.S. Securities and Exchange Commission). We’ve listed some of the requirements in the above cart. For example, the companies are required to make an annual report with audited financial statements, the statements must be audited by an accountant with oversight provided under the Sarbanes-Oxley Act of 2002, the distribution of annual and interim reports are regulated, et cetera.
Compliance with stricter regulatory requirements increases the transparency of the company’s results of operations, which provides access to quality information and helps investors, increasing confidence in the company.
These factors even act as a motivation for institutional investors and increase liquidity with more hands trading the stock.
Of course, companies (HMLSF) such as Canopy Growth (WEED), Aurora Cannabis (ACBFF), and MedReleaf (MEDFF) that are listed on the Canadian markets have to meet regulatory requirements. However, Cronos’s latest listing gives it better access, of course, to the US capital markets.