SEC intensifies push to bring SMEs to capital market, citing growth and legacy benefits

Senior Professor Hareendra Dissabandara

By Nishel Fernando

The Securities and Exchange Commission of Sri Lanka (SEC) is mounting a significant drive to encourage more small and medium-sized enterprises (SMEs) to list on the Colombo Stock Exchange (CSE), positioning the capital market as a crucial engine for economic recovery and corporate longevity.

The initiative was highlighted by SEC Chairman Senior Professor Hareendra Dissabandara, during his keynote address at an issuer forum held in Colombo recently. 

The event themed ‘Innovative Businesses To Propel Economic Growth’ was a collaborative effort by the Trade Ministry, Registrar of Companies, SEC and CSE.

Addressing the business leaders, Prof. Dissabandara emphasised that the SMEs and family-run businesses are the “foundation and backbone” of Sri Lanka’s economy, contributing 52 percent to the nation’s GDP and providing 45 percent of its employment. However, he acknowledged that these vital enterprises often face persistent challenges in funding growth, managing succession and professionalising their operations.

Outlining the path to national economic recovery after a period of severe distress, Prof. Dissabandara identified increasing investment and utilising the capital market for it as a key solution. He urged the business owners to view a public listing not as a loss of control but as a strategic move to “unlock capital and credibility while preserving the legacy”.

“Public listing is not about giving up control,” Prof. Dissabandara stated. 

“At the CSE, your business can raise capital without debt, attract high-calibre talent and investors, improve transparency and corporate discipline and structure succession across generations.”

Prof. Dissabandara described the SEC’s evolving role from a traditional regulator to a proactive “enabler” for market-based growth. He directly addressed the common fears among the business owners regarding the compliance burdens, transparency requirements and loss of independence.

“Our mission is to demystify capital markets, simplify access and protect your rights as business founders and shareholders,” he assured the audience.

To translate this vision into action, the SEC, in partnership with the CSE, is rolling out several initiatives, including simplified listing rules, founder-friendly governance and enhanced awareness and advisory by launching more awareness sessions, advisory services and customised listing pathways to guide the companies through the process.

Prof. Dissabandara stressed that the timing is opportune.  “With our modernised digital infrastructure, investor protection and tailored frameworks, Sri Lanka’s capital market is more open and inclusive than ever,” he said. He issued a strong call to action, inviting the entrepreneurs to engage with the SEC and CSE early in their strategic planning, even before a final decision to list has been made. “We are here not to impose but to listen, simplify and solve,” he concluded. 

“Let’s make Sri Lanka’s capital market not just an alternative but the first choice for visionary SMEs and family businesses.”