The Colombo Stock Exchange (CSE) has decided to discontinue the current industry classification used to categorise its listed companies and adopt the Global Industry Classification Standard (GICS) along with S&P/CSE co-branded sector indices with effect January 20.
The CSE initiated a pilot run of the GICS classification in 2015 which was maintained as a secondary classification with an intention to provide adequate time for all stakeholders to be comfortable with GICS and ensure a smooth transition. The GICS structure which comprises of 11 sectors and 24 industry groups, provides the transparency and accuracy needed for more accurate comparisons. Companies are classified quantitatively and qualitatively with each company assigned a single GICS Classification at the industry group level according to its principal business activity, the CSE said in a media release.
CSE CEO Rajeeva Bandaranaike, commenting on the adoption of the Global classification mechanism, said: “With globalisation making headway our market has also shown dynamic interaction to changes in the global markets. As a result, it is critical for CSE to adopt a globally accepted classification which would help the foreign and local investors alike to capture and assess the impact of global, regional or local industry trends on a portfolio.”
The Global Industry Classification Standard (GICS®) was jointly developed by Standard & Poor's and MSCI Barra to meet the global financial community's need for one complete consistent set of global sector and industry definitions. The world's leading financial professionals across all investment disciplines, including asset managers, institutional investors, consultants, and researchers have adopted GICS as the classification standard, it said.
GICS Classification of companies with market data can be accessed through www.cse.lk. (DEC)
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