Lynn Martin, President, NYSE Group 
Interviewer: Ruth Umoh, FORTUNE

Most Powerful Women 2022 - Powering The Exchange

at the start of 2022 she was tapped to head up one of the most iconic and influential business institutions in the world. The new york stock exchange where more than two billion shares are traded each day. Lynn martin became the 16th president of the N. Y. S. C. In early january, becoming only the second woman in the exchanges 230 year history to do so. She has led the exchange through a volatile time since taking the reins, fears of recession, inflation and rising interest rates and a bear market. But perhaps that's par for the course. When leading the world's largest stock exchange, Lynne joins us today to talk about her core belief how they could apply more broadly in business and what it will take to succeed in the job and more. Please welcome Lynn for a conversation with my colleague and M. P. W. Co chair ruth. You mo All right, Lynn martin in the flesh. Thank you so much for joining us. Of course, of course Emma alluded to in the introduction to this segment. You sure picked an opportune time, head of the new york stock exchange, rampant market volatility, A looming recession by some estimates and inflation record high inflation. How are you navigating all of those opposing forces while still remaining agile while still, you know, future proof in the business. Talk to us. Yeah. So it's my belief that you know, when there's times of disruption, there's times of volatility. There are a couple of core things you can do as a leader. # one, you've got to communicate and the way I apply that to business is our job as an exchange during this time is to ensure that our markets remain open, that our markets remain efficient, that our customers have the best experience possible to manage risk. Uh It's also in my mind and time to think differently um and build for the future and think about not just the exchange of today but the exchange of three years from now, five years from now and what do I want that to look like? What do we want that to look like? So I think it's the new york stock exchange. It's very important given the volatility of the market, given the uncertainty in the mar That we remain very visible uh to allay whatever fears both investors as well as issuers may have. And more importantly than ever it's our job to advocate in this time of immense change for those companies that have chosen to be members of our community. There's 2400 listed companies that we have. Yes, let's talk about some of those fears you took over the reins of the exchange following consecutive record years for new listings. It's seen at the top of the year that we see a continuation of that. That obviously hasn't happened. Is everyone still on hold break this down for us. What's going on the I. P. O. Market. Yeah the I. P. O. Market that first of all the public market currency has never been stronger. The amount of conversations we have with companies in our pipeline continues. Apace Companies still want to go public but they don't want to go public when you don't know if the Dow is going to be up or down 12, points on any one given day. So that's kind of what you're seeing at the moment. You see a bunch of companies that have been private are stacked up there waiting for the time when the market starts to calm down from a volatility perspective. And one of the metric I look at is not just you know the overall market barometers of what the dow is with the S. And P. 500. But also look at the vix a lot. The vix is the measure of equity market volatility. That's the key metric until you see that get below 20 for a sustained period of time. The floodgates I don't think are gonna open on. Those companies have been talking to us for a while who even working with for a while. Um Come to market, are you seeing that apprehension across industries I would assume. Okay there's more apprehension among the tech sector. Energy. Perhaps not so much. Yeah. We have had some IPO's this year. We actually just had our largest I. P. O. In the U. S. Equity markets about a month and a half ago with core bridge which was a spin off of A. I. G. Um went to market, they raised $1.7 billion dollars in this market. The price at the low end of the range. They they're a good core business. There's still demand for that stock and that stock has traded traded well. But we've also seen other sectors come to market, we've seen clean energy, that's been one sector where you have seen some activity. Um You also see businesses like cyber start to think about maybe I should dip my toe mainly because if you think about your own businesses as you plan for 2023 what are areas that you are going to be thinking about? You're gonna be thinking about protecting yourself from cyber risk. I know that's an area that I'm incredibly focused on, but you're also looking at those E. S. G. Metrics and supporting businesses that are promoting the brown to green transition, particularly with our energy markets and energy security continues to be something that you know, we continue to be focused on. I'll soon pivot to discuss USG before I do that. As you said, companies are much more prudent about when they come to market. What do you what do you think it will take for us to see that reversal to what we saw last year? The resurgence of listings. So if I go back, so I'm a statistician by trade. I took a totally non linear path to get here. I was a program, I got a degree in computer science. Um And then because you know, I was a girl living in Manhattan, I decided for good measure to go get a Masters in statistics. So I'm kind of looking at two tails here. Um back to my statistical route. 2021 was one tale where you had the best I. P. O. Year ever. Um and this year you're you have the slowest in terms of proceeds raised in at least a decade. I think probably when the market starts to stabilize, you start to see the mean or the median come back. You're not gonna see a 2021 but you're certainly not going to see a 2022 Lynn when someone googles your name, which I did. What comes up immediately is Lynn martin computer scientist, as you said, you're a statistician, which I think is honestly an apt description. You're obsessed with data encoded in your self proclaimed technique here where it's not mine. What sparked that interest and how are you using that tech background? That data savvy in your current role as the ceo. Yeah, it's I self proclaimed myself as a tech nerd and a data nerd at the same time. So all super interesting ways to flatter oneself as a female. I you know, when I think about when I was in college, back in the late nights when I graduated, I was a computer scientist. I went to go work for IBM. Um as my first job out of college because that's kind of what you did as a computer scientist you went to work for, you know, a big tech firm. Um, I would have never imagined that financial markets would have undergone the revolution that they have. And I wouldn't have also never anticipated that we all would have gone undergone the personal evolution that we had. I think about when I grow Graduate in the late 90s, you know, the.com boom was there. Um, and I didn't have a cell phone, I didn't have an email address. So there are basic things not too long ago that we can all remember that. Yeah, that was the way our lives were. But today we're all attracted to that Darn phone. We're all obsessed with our email. We're all so connected. I think that's a wonderful thing. But I break that down to a really personal example because I think that's the way every business operates now. I don't know of any business in the world that is not using technology in some way, shape or form across industry, be, you know, the consumer facing businesses that leverage online shopping customer analytics for all of your businesses, Those of you who run your businesses, you rely on customer analytics to know your customers better. Um, and every business that I know is really a tech business now. So I think it's hard to delineate what the tech business versus what's what's not a texas? Absolutely. Well, you know, piggybacking off of that, How is the electronic trade and revolution changed financial markets? So I like to say that electron trading has been the great democratize er of financial markets. You think back to, like when I was graduating school there was a bunch of people, most of them were men standing around a pit screaming buys and sells, right? Um and I remember asking my mom, how do you work at the stock exchange? How do you become a stockbroker? And a lot of it was passed on through through lineage was either someone you knew or was your dad or your cousin or brother or whatever the case may be, electronic trading gave a voice to anyone, it's a matching engine does not matter. That does not care what you look like, who you are, how big you are, who you know, it's going to democratize your order input versus someone else's order input. So when I actually joined the exchange industry, it was because not because of my financial background because they needed someone, anyone who could talk to a programmer about how to code to this thing called an A. P. I. As markets were moving more and more electronic. So I think technology has been great, it's a big democratize er for giving us a voice giving women a voice giving people of color, voice giving anyone a voice and that voices on equal footing to everyone else in society. Let's talk Yes. G And circle back to that topic that has become increasingly contentious under your leadership in new york stock exchange has launched an advisory council on sustainability to share best practices. You're also looking more closely at board diversity concurrently. We have seen backlash against E. S. G. Do you think that that backlash will lead companies to pull back from social environmental commit? It means or conversely, do you think the train is already out of the station? We're moving full speed ahead. It's ridiculous at this point. Yeah, so 2400 public companies is what we have in our community. If I look at our own community, 100% have at least one female board director, uh 95% of two or more, 90% have 20% female directors. So on the governance side it feels like we have made good progress and even listening to you all introduce yourself this morning, it was I run this really large business and I'm on these 15 boards, which is amazing. I mean, I think it probably if you did that or when you did that, you know, 5, 10 years ago, it looked a lot different. So I think we've made a lot of progress on the government side from the conversations I've had with our community of Ceo this year, they're trying to do the right thing on environmental, but identifying and measuring and disclosing scope three, something like scope three is really hard and it's not because they don't want to if they have to have tools to do it. So our thesis is our job at the new york stock exchange is to provide our issuers with tools because they want to do the right thing in environmental, social and governance. They just don't 100% know how to get there. So we've got the sustainability council which gets a variety of chief sustainability officers together, helps identify best practices. They were the ones who commented on our the climate disclosure rule that the sec uh came out with earlier this year. We've got the Board Diversity Council which helps improve the diversity of boards, which we've had probably about 30 different placements since we launched a couple of years ago. Uh and you know, we have a variety of other services but ultimately what's going to continue to push the needle forward on E. S. G. Metrics is the investors. And I was just reading a report last night, 40% of dollars invested in the market today is going against TsG funds last year was 33 percent. So that's something that C. E. O. S are paying attention to because there is an E. S. G. Investing lens that increasingly is being applied to public markets very well said well covering these tectonic shifts in business has certainly kept us journalists on our team. I can only imagine what it's like for you running an iconic institution, Lynn martin. Thank you for taking the time. Thank you for having me.