It's been 9 long months since the CEO of the Mongolian Stock Exchange (MSE) stepped down, and the search for a new CEO has yet to yield results. Announced last year, the selection process remains shrouded in silence…

🤔 What’s Going On?

The appointment of a CEO is crucial for any publicly traded company, especially one with international exposure. Delays in leadership can lead to operational dysfunction, stalled implementation of new strategies, internal turmoil, and eroded investor confidence.

• 🧟‍♀️ A Cautionary Tale: Take Gap (GAP) as a classic example. After CEO Sonia Singhal resigned in July 2022, the company operated with an interim CEO, resulting in an 8% drop in sales for the first half of 2023 and layoffs of over 1,800 employees in April. The fallout hinders Gap's competitiveness in a crowded market.

⁉ So, Why the Delay?

The situation in MSE is particularly complicated. With the Ministry of Finance holding a 66% stake in the MSE, the CEO appointment process has been slow and cumbersome. Since January, a temporary deputy has been managing the role, but significant challenges remain.

• ❗ Regulatory Hurdles: As a state-owned enterprise, the MSE's operations and appointments are bound by state and local property laws, designed to protect the interests of minority shareholders.

💭 What About Shareholder Interests?

Currently, 7,697 small shareholders own 34% of the MSE. As a public company, their interests must take precedence. However, the decision-making process regarding the appointment of leadership has stirred controversy and concern among these stakeholders.

Looking back, 2 years ago, discussions about IPOs for up to 34% of 26 state-owned companies were hot topics. Yet, the MSE, despite going public, has failed to uphold transparency in its leadership selection, leaving many shareholders feeling left in the dark. As the clock ticks, the urgency for decisive action grows. Despite being a public company, MSE lacks transparency in its leadership selection.