More and more African countries want a stock exchange, but on a continent where many companies are still family owned, firms often just don’t see the benefits of stock exchanges, says Diana Games, CEO of Johannesburg-based business advisory Africa @ Work.

Controlled by the founding families, many African companies — even the ones that have become large conglomerates — are generally reluctant to give up management control to private equity firms or shareholders, Games said in a guest column in BusinessDayLive. Many African family businesses aren’t interested in complying with corporate governance and financial regulations of the type required to be publicly listed.

Many African companies believe their proprietary information gives them an edge over the competition, resulting in cultural resistance to transparency.

The African Securities Exchanges Association (ASEA) met last week in Johannesburg, to discuss what African stock exchanges need to do differently that will enhance relevance and boost performance to attract investors and build assets.

More than 1.5-million businesses are registered in Africa, with just 1,600 listed on the 23 stock exchanges that comprise the African Securities Exchanges Association.

But while Wall Street gets the headlines, less than 1 percent of the 27 million businesses in the U.S. are publicly traded on the major exchanges, according to Forbes.

Size matters. That was a key message at this month’s African Securities Exchanges Association, Games said. Africa’s smaller bourses, in their effort to attract international investment, tend to adopt regulatory and operational standards and requirements that are out of alignment with their markets. And many bourses are reluctant to expand their exposure and offerings through greater regional integration.

African companies prefer to raise capital with bank loans, paying the premium rather than deal with the intricacies of a stock exchange.

Nigeria’s Dangote Group, still run by its founder, Aliko Dangote, is an exception. It’s the largest company on the Nigerian Stock Exchange by market capitalisation.

Some exchanges like Kenya’s for example, introduced boards to enable small-to-medium enterprises to raise money and profile, but it hasn’t exactly worked. Size of most companies in Africa is part of the problem. They are categorized as small and medium enterprises. For most, that means their focus is survival rather than adherence to western governance standards.

With only only about 2 percent of assets traded in Africa, the weakness of the many stock exchanges across the continent is that most are not liquid. Most do little trade and have few listed companies — and yet more and more countries want one, Games said.

Greater corporate disclosure would level the playing  field but is seen as undermining companies’competitive advantage. Companies that are listed still often disclose the minimum to be in compliance while exchanges want more disclosure.

Privately held firms aren’t subject to the same disclosure laws as public companies, so their financial performance is opaque and it’s more difficult to identify their contributions to the economy, Forbes reports.

African exchanges must find innovative solutions, Games said.

Sovereignty anxiety continues to undermine collaboration with other exchanges, despite initiatives under way in West and East Africa to link exchanges.

But business practices and attitudes are starting to change in Africa’s private sector as a new generation of leaders steps up that is open to more modern business practices. “To tap into this change, stock exchanges need to reach out to the African private sector and attract the kind of capital that mobile banking has shown exists in these markets, Games said.

“We need to step away from our traditional methods to reach nontraditional assets.”