Item 1. Business

Overview

Nasdaq is a global technology company serving the capital markets and other industries. Our diverse offerings of data, analytics, software and services enables clients to optimize and execute their business vision with confidence.

We manage, operate and provide our products and services in four business segments: Market Services, Corporate Platforms, Investment Intelligence and Market Technology. In the fourth quarter of 2020, we renamed certain of our segments and businesses. See Note 1, “Organization and Nature of Operations,” to the consolidated financial statements for further discussion.

History

Nasdaq was founded in 1971 as a wholly-owned subsidiary of FINRA. Beginning in 2000, FINRA restructured and broadened ownership in Nasdaq by selling shares to FINRA members, investment companies and issuers listed on The Nasdaq Stock Market. In connection with this restructuring, FINRA fully divested its ownership of Nasdaq in 2006, and The Nasdaq Stock Market became an independent registered national securities exchange in 2007.

In February 2008, Nasdaq and OMX AB combined their businesses, and we changed our corporate name to The NASDAQ OMX Group, Inc. This transformational combination resulted in the expansion of our business from a U.S.-based exchange operator to a global exchange company offering technology that powers our own exchanges and markets as well as many other marketplaces around the world. We operated as the NASDAQ OMX Group until we rebranded our business as Nasdaq, Inc. in 2015. The chart below shows our historical evolution from 1971 through the present.

Growth Strategy

Since our transformative combination with OMX AB in 2008, we have grown our business both organically and through acquisitions that have expanded our operations globally and increasingly diversified our product and service offerings. This evolution was driven by our ability to create opportunities in areas adjacent to our core businesses, many

of which are non-transaction based and rooted in innovative technology. To keep pace with our understanding of future trends and to ensure our continued success in the evolving business environment, we have focused on refining our vision, mission, purpose and strategy:

Our Vision: To reimagine markets to realize the potential of tomorrow.

Our Mission: To provide the premier platform and ecosystem for global capital markets and beyond with unmatched technology, insights and markets expertise.

Our Purpose: To champion inclusive growth and prosperity. We power stronger economies, create more equitable opportunities and contribute to a more sustainable world to help our communities, clients, employees and people of all backgrounds reach their full potential.

Our Strategy: Our strategic direction is driven by our continuous examination of: (i) key macroeconomic, regulatory and technology trends, (ii) consultation with our clients about short- and long-term trends in their businesses and (iii) the competitive landscape.

Under the strategic direction that we have been implementing over the past four years, we have focused on maximizing the resources, people and capital allocated to our largest growth opportunities, particularly in our Market Technology and Investment Intelligence segments, as we seek to execute on our transformation into a higher growth, more scalable platform to meet our clients' most critical needs. We are also committed to maintaining and enhancing the marketplace platform businesses that are core to Nasdaq, including Market Services and Corporate Platforms. Additionally, we will continue to execute on our strategy to reduce capital and resources in areas that we believe are not as strategic to our clients and have less growth potential within Nasdaq. Our four business segments reflect our broad capabilities, with Market Technology and Investment Intelligence providing our technology and intelligence growth platform, and Corporate Platforms and Market Services serving as our foundational marketplace core.

• Increasing Investment in Businesses Where We See the Highest Growth Opportunity. We have increased investment in areas that we believe help solve our clients’ biggest challenges and are likely to generate growth for our stockholders. These areas include: the index and analytics business within our Investment Intelligence segment; ESG-focused solutions, within our Corporate Platforms segment; and our Market Technology segment (including our anti-financial crime technology business).

Consistent with this objective, in 2020 we acquired Solovis, a provider of multi-asset class portfolio management, analytics and reporting tools across public and private markets, which is a part of our Investment Intelligence segment. In February 2021, we completed the acquisition of Verafin, a provider of anti-financial

crime management solutions, which is part of our Market Technology segment. We are continuing to invest in the Market Technology segment through the expansion, enhancement, and flexibility of our technology platform, in addition to leveraging emerging technologies such as machine intelligence in our Trade Surveillance offering.

• Enhancing Our Foundation. As we strive to grow our business, we also have focused on enhancing our leadership position in the marketplaces in which we operate as we continue to innovate with new functionality and strong market share in our core markets. We migrated Nasdaq BX Options to a new trading platform that leverages the NFF. This updated technology will drive commonality across our internal derivatives markets.

• Optimizing Slower Growth Businesses. We continually review areas that are not critical to our core. In these areas, we expect to continue to target resiliency and efficiency versus growth, and free up resources when possible to redirect toward greater opportunities. In February 2021, we entered into an agreement to sell our U.S. fixed income business. This transaction aligns with our strategy to concentrate our resources and capital in order to maximize our potential as a major technology and analytics provider to the global capital markets. See “Sale of U.S. Fixed Income Business,” of Note 21, “Subsequent Events,” to the consolidated financial statements for further discussion of this transaction.

Products and Services

Market Services

Our Market Services segment includes our Equity Derivative Trading and Clearing, Cash Equity Trading, FICC and Trade Management Services businesses.

Equity Derivative Trading and Clearing

We operate six options exchanges in the U.S.: Nasdaq PHLX, The Nasdaq Options Market, Nasdaq BX Options, Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX. These exchanges facilitate the trading of equity, ETF, index and foreign currency options. Together, our combined options market share in 2020 represented the largest share of the U.S. market for all categories, including single-exchange-listed options products. Our options trading platforms provide trading opportunities to both retail investors, algorithmic trading firms and market makers, who tend to prefer electronic trading, and institutional investors, who typically pursue more complex trading strategies and often trade on the floor.

In Europe, Nasdaq offers trading in derivatives, such as stock options and futures and index options and futures. Nasdaq Clearing offers central counterparty clearing services for stock options and futures and index options and futures.

Cash Equity Trading

In the U.S., we operate three cash equity exchanges: The Nasdaq Stock Market, Nasdaq BX and Nasdaq PSX. Our U.S. cash equity exchanges offer trading of both Nasdaq-listed and non-Nasdaq-listed securities. The Nasdaq Stock Market is the largest single venue of liquidity for trading U.S.-listed cash equities. Market participants include market makers, broker-dealers, ATSs, institutional investors, and registered securities exchanges.

In Canada, we operate an exchange with three independent markets, Nasdaq Canada CXC, Nasdaq Canada CX2 and Nasdaq Canada CXD, for the trading of Canadian-listed securities.

In Europe, Nasdaq operates exchanges in Stockholm (Sweden), Copenhagen (Denmark), Helsinki (Finland), and Reykjavik (Iceland). We also operate exchanges in Tallinn (Estonia), Riga (Latvia) and Vilnius (Lithuania).

Collectively, the Nasdaq Nordic and Nasdaq Baltic exchanges offer trading in cash equities, depository receipts, warrants, convertibles, rights, fund units and ETFs, as well as trading and clearing of derivatives and clearing of resale and repurchase agreements. Our platform allows the exchanges to share the same trading system, which enables efficient cross-border trading and settlement, cross membership and a single source for Nordic data products. Settlement and registration of cash equity trading takes place in Sweden, Finland, and Denmark via the local central securities depositories. In addition, Nasdaq owns a central securities depository that provides notary, settlement, central maintenance and other services in the Baltic countries and Iceland.

FICC

Our FICC business includes the U.S. and European portions of the Nasdaq Fixed Income, or NFI, business and Nasdaq Commodities.

The U.S. portion of Nasdaq Fixed Income includes an electronic platform for trading U.S. Treasuries. The electronic trading platform provides real-time institutional trading of benchmark U.S. Treasury securities. Through this business, we provide trading access to the U.S. Treasury securities market with an array of trading instruments to meet various investment goals across the fixed income spectrum. On February 2, 2021, we announced that we entered into a purchase and sale agreement, or the Purchase Agreement, to sell our U.S. Fixed Income business. See “Sale of U.S. Fixed Income Business,” of Note 21, “Subsequent Events,” to the consolidated financial statements for further discussion of this transaction.

The European portion of Nasdaq Fixed Income provides a wide range of products and services, such as trading and clearing, for fixed income products in Sweden, Denmark, Finland, Iceland, Estonia, Lithuania and Latvia. Nasdaq is the largest bond listing venue in the Nordics, with more than 5,800 listed retail and institutional bonds. In addition, Nasdaq Nordic facilitates the trading and clearing of Nordic fixed

income derivatives in a unique market structure. Buyers and sellers agree to trades in fixed income derivatives through bilateral negotiations and then report those trades to Nasdaq Clearing. Nasdaq Clearing offers central counterparty clearing services for fixed-income options and futures and interest rate swaps. Nasdaq Clearing also operates a clearing service for the resale and repurchase agreement market.

Nasdaq Commodities is the brand name for Nasdaq’s European commodity-related products and services. Nasdaq Commodities’ offerings include derivatives in power, natural gas and carbon emission markets, seafood, electricity certificates and clearing services. These products are listed on Nasdaq Oslo ASA, except for seafood, which is listed on Fishpool, a third party platform.

Nasdaq Oslo ASA is the commodity derivatives exchange for European products. All trades with Nasdaq Oslo ASA are subject to clearing with Nasdaq Clearing, which offers central counterparty clearing services for commodities options and futures.

Trade Management Services

We provide market participants with a wide variety of alternatives for connecting to and accessing our markets for a fee. Our marketplaces may be accessed via a number of different protocols used for quoting, order entry, trade reporting and connectivity to various data feeds. We also offer the Nasdaq Workstation, a browser-based, front-end interface that allows market participants to view data and enter orders, quotes and trade reports. In addition, we offer a variety of add-on compliance tools to help firms comply with regulatory requirements.

We provide colocation services to market participants, whereby we offer firms cabinet space and power to house their own equipment and servers within our data centers. Additionally, we offer a number of wireless connectivity offerings between select data centers using millimeter wave and microwave technology.

Our broker services operations business primarily offers technology and customized securities administration solutions to financial participants in the Nordic market. Such services and solutions primarily consist of flexible back-office systems, which allow customers to efficiently manage safekeeping, settlement and corporate actions and reporting, and include connectivity to exchanges and central securities depositories. In January 2020, we commenced an orderly wind-down of this broker services operations business. We expect this wind-down to continue through 2021.

Corporate Platforms

Our Corporate Platforms segment includes our Listing Services and IR & ESG Services businesses. These businesses deliver critical capital market and governance solutions across the lifecycle of public and private companies.

Listing Services

We operate a variety of listing platforms around the world to provide multiple global capital raising solutions for private and public companies. Companies listed on our markets represent a diverse array of industries including, among others, health care, consumer products, telecommunication services, information technology, financial services, industrials and energy. Our main listing markets are The Nasdaq Stock Market and the Nasdaq Nordic and Nasdaq Baltic exchanges.

Companies seeking to list securities on The Nasdaq Stock Market may do so on one of the three market tiers: The Nasdaq Global Select Market, The Nasdaq Global Market, or The Nasdaq Capital Market. To qualify, companies must meet minimum listing requirements, including specified financial and corporate governance criteria. Once listed, companies must maintain rigorous listing and corporate governance standards. We offer a suite of products to assist companies manage corporate governance standards, discussed below in “IR & ESG Services.”

As of December 31, 2020, a total of 3,392 companies listed securities on The Nasdaq Stock Market, with 1,476 listings on The Nasdaq Global Select Market, 907 on The Nasdaq Global Market and 1,009 on The Nasdaq Capital Market.

We seek new listings from companies conducting IPOs, including SPACs, and direct listings as well as companies looking to switch from alternative exchanges. In 2020, The Nasdaq Stock Market attracted 454 new listings, including 316 IPOs, representing 67% of U.S. IPOs in 2020. Of the 316 IPOs that listed on The Nasdaq Stock Market, 184 were operating companies, representing 83% of all operating company IPOs in 2020 and a 53% win rate among SPACs. The new listings were comprised of the following:

IPOs			316
Switches from the New York Stock Exchange LLC, or NYSE and the NYSE American LLC, or NYSE American			20
Upgrades from OTC			46
ETPs and Other Listings			72
Total			454

During 2020, we had 20 new listings resulting from companies switching their listings from NYSE or NYSE American to join Nasdaq. Together with companies that transferred additional securities to Nasdaq during 2020, an aggregate of $282 billion in global equity market capitalization switched to Nasdaq. Notable switches in 2020 included AstraZeneca PLC, American Electric Power Company, Inc., Keurig Dr Pepper Inc., and Opendoor Technologies.

We also offer listings on the exchanges that comprise Nasdaq Nordic and Nasdaq Baltic. For smaller companies and growth companies, we offer access to the financial markets through the Nasdaq First North alternative marketplaces. As of December 31, 2020, a total of 1,071 companies listed

securities on our Nordic and Baltic exchanges and Nasdaq First North.

Our European listing customers include companies, funds and governments. Customers issue securities in the form of cash equities, depository receipts, warrants, ETPs, convertibles, rights, options, bonds or fixed-income related products. In 2020, a total of 67 new companies listed on our Nordic and Baltic exchanges and Nasdaq First North. In addition, 12 companies upgraded their listings from Nasdaq First North to the Nordic and Baltic exchanges.

Our Listing Services business also includes NPM, which provides liquidity solutions for private companies to enable employees, investors, and companies to execute transactions.

We are continuing to grow our U.S. Corporate Bond exchange for the listing of corporate bonds. This exchange operates pursuant to The Nasdaq Stock Market exchange license and is powered by the NFF. Surveillance is conducted by the Nasdaq regulatory team, assisted by our Nasdaq Trade Surveillance solution. As of December 31, 2020, 86 corporate bonds were listed on the Corporate Bond exchange. Our U.S. corporate bond listing offering won 11 new issues and we added 20 existing bond listings that transferred from the NYSE.

IR & ESG Services

Our IR & ESG Services business serves both public and private companies and organizations. Our public company clients can be companies listed on our exchanges or other U.S. and global exchanges. We help organizations enhance their ability to understand and expand their global shareholder base, improve corporate governance, and navigate the evolving ESG landscape through our suite of advanced technology, analytics, and consultative services. We also provide clients with counsel on a range of governance and sustainability-related issues.

As of December 31, 2020, we provided IR & ESG Services products and services in the following key areas:

• Investor Relations Intelligence. We offer a global team of consultative experts that deliver advisory services including Strategic Capital Intelligence, Shareholder Identification and Perception Studies, as well as an industry-leading platform, Nasdaq IR Insight, to investor relations professionals. These solutions allow investor relations officers to better manage their investor relations programs, understand their investor base, target new investors, manage meetings and consume key data such as investor profiles, equity research, consensus estimates and news.

• Governance Solutions. We provide a global technology offering and consultative services that streamline the meeting process for board of directors and executive leadership teams and help them accelerate decision making and strengthen governance. Our solutions protect sensitive data and facilitate productive collaboration, so

board members and teams can work faster and more effectively.

In January 2020, Nasdaq acquired OneReport, a provider of ESG reporting solutions that helps organizations to navigate corporate responsibility frameworks, manage the information capture and response process, and deliver ESG data to ratings agencies and other stakeholders.

Investment Intelligence

Our Investment Intelligence business provides the global investing community with access to the financial markets together with strong investment insights.

Our Investment Intelligence segment is organized into the following businesses:

• Market Data;

• Index; and

• Analytics.

For both institutional and retail investors, our market and alternative data enhances transparency and access to the markets we operate, and we help guide investment decisions around the globe through our proprietary indexes and analytics.

Market Data

Our Market Data business sells and distributes historical and real-time market data to the sell-side, the institutional investing community, retail online brokers, proprietary trading shops, other venues, internet portals and data distributors.

Our market data products enhance transparency of market activity within our exchanges and provide critical information to professional and non-professional investors globally. We collect, process and create information and earn revenues as a distributor of our own, as well as select third-party content. We provide varying levels of quote and trade information to our customers who in turn provide subscriptions for this information. Our systems enable distributors to gain access to our market depth, fund valuation, order imbalances, market sentiment and other analytical data.

We distribute this proprietary market information to both market participants and non-participants through a number of proprietary products, including Nasdaq TotalView, our flagship market depth quote product. TotalView shows subscribers quotes, orders and total anonymous interest at every displayed price level in The Nasdaq Stock Market for Nasdaq-listed securities and critical data for the opening, closing, halt and IPO crosses. We also offer TotalView products for our Nasdaq BX, Nasdaq PSX, Nasdaq Fixed Income and other Nordic markets.

We operate several other proprietary services and data products to provide market information, including Nasdaq Basic, a low cost alternative to the industry Level 1 feed and Nasdaq Canada Basic, a low cost alternative to other high

priced data feeds. We also provide various other data, including data relating to our six U.S. options exchanges, Nordic and U.S. futures, Nordic commodities, and U.S. Treasuries.

Our Market Data business also includes revenues from U.S. tape plans. The plan administrators sell quotation and last sale information for all transactions in Nasdaq-listed securities, whether traded on The Nasdaq Stock Market or other exchanges, to market participants and to data distributors, who then provide the information to subscribers. After deducting costs, the plan administrators distribute the tape revenues to the respective plan participants based on a formula required by Regulation NMS that takes into account both trading and quoting activity.

The Nasdaq Nordic and Nasdaq Baltic exchanges, as well as Nasdaq Commodities, also offer data products and services. These data products and services provide critical market transparency to professional and non-professional investors who participate in European marketplaces and, at the same time, give investors greater insight into these markets.

Much like the U.S. products, European data products and services are based on trading information from the Nasdaq Nordic and Nasdaq Baltic exchanges, as well as Nasdaq Commodities, for the following classes of assets: cash equities, bonds, derivatives and commodities. We provide varying levels of quote and trade information to market participants and to data distributors, who in turn provide subscriptions for this information. Significant European data products include Nordic Equity TotalView, Nordic Derivative TotalView, and Nordic Fixed Income TotalView, Level 2 and Analytics.

Index

Our Index business develops and licenses Nasdaq-branded indexes and financial products. License fees for our trademark licenses vary by product based on a percentage of underlying assets, dollar value of a product issuance, number of products or number of contracts traded. We also license cash-settled options, futures and options on futures on our indexes.

As of December 31, 2020, 339 ETPs listed in over 20 countries and exchanges tracked a Nasdaq index and accounted for $359 billion in AUM. This includes approximately $121 billion in ETP AUM, or 34% of the total AUM that tracked our smart beta indexes during this same time period. Our flagship index, the Nasdaq-100 Index, includes the top 100 non-financial securities listed on The Nasdaq Stock Market, and is tracked by more than 70 ETPs worldwide, and had nearly $200 billion in assets tracking the index as of December 31, 2020.

We provide index data products based on Nasdaq indexes. Index data products include our Global Index Data Service, which delivers real-time index values throughout the trading day, and Global Index Watch/Global Index File Delivery Service, which delivers daily as well as historical weightings and components data, corporate actions and a breadth of

additional data for our more than 46,000 indexes that we operate.

Nasdaq Dorsey Wright, or NDW, provides passive indexing and smart beta strategies to support the financial advisor community, as well as Systematic Relative Strength strategies to manage separately and unified managed accounts. NDW strengthens Nasdaq’s position as a leading smart beta index provider in the U.S.

Analytics

Our Analytics business provides asset managers, investment consultants and institutional asset owners with information and analytics to make data-driven investment decisions, deploy their resources more productively, and provide liquidity solutions for private funds. Through eVestment and Solovis, we provide a suite of cloud-based solutions that help institutional investors and consultants conduct pre-investment due diligence, and monitor their portfolios post-investment. The eVestment platform also enables asset managers to market their institutional products worldwide.

Additionally, our Nasdaq Cloud Data Service provides a flexible and efficient method of delivery for real-time exchange data and other financial information. Data is made available through a suite of application programming interfaces, or APIs, allowing for the integration of data from disparate sources and a reduction in time to market for customer-designed applications. The API is highly scalable and can support the delivery of real-time exchange data.

Through the Solovis platform, endowments, foundations, pensions and family offices transform how they collect and aggregate investment data, analyze portfolio performance, model and predict future outcomes, and share meaningful portfolio insights with key stakeholders. The Nasdaq Fund Network and Quandl are additional components in our suite of investment data and analytics offerings. Nasdaq Fund Network gathers and distributes daily net asset values from over 33,000 funds and other investment vehicles across North America. We have extended Nasdaq Fund Network to support the distribution of collective investment trusts, hedge funds, managed accounts, separate accounts and demand deposit accounts. Quandl strengthens our position as a leading source for financial, economic, and alternative datasets. For investment management firms, investment banks and other investors, we provide predictive insights to inform investment decisions from discovered data.

Market Technology

Powering over 130 market infrastructure operators and new market clients in more than 50 countries, our Market Technology business is a leading global technology solutions provider and partner to exchanges, clearing organizations, central securities depositories, regulators, banks, brokers, buy-side firms and corporate businesses. Our solutions can handle a wide array of assets, including but not limited to cash equities, equity derivatives, currencies, various interest-bearing securities, commodities, energy products and digital currencies. Our solutions can also be used in the creation of

new asset classes, and non-capital markets customers, including those in insurance liabilities securitization, cryptocurrencies and sports wagering.

Nasdaq’s market technology is utilized by leading markets in the U.S., Europe and Asia as well as emerging markets in the Middle East, Latin America, and Africa. Additionally, more than 180 market participants leverage our surveillance technology globally to manage their integrity obligations and assist them in complying with market rules, regulations and internal market surveillance policies.

During 2020, we advanced our strategic goals in order to establish a comprehensive SaaS business with a broad and interconnected portfolio by extending and migrating our current offerings to services. We created a cross-discipline transformation program, successfully migrated our Nasdaq Market Surveillance offering for marketplaces and regulators, advanced our Universal Matching Service, which is a cloud-optimize matching service, and launched our new SaaS marketplace platform layer, the Nasdaq Marketplace Services Platform, which leverages the NFF. We added 10 SaaS market infrastructure customers and 17 market participant customers, and established a partnership with Microsoft to deliver our Marketplace Services Platform via Microsoft’s Azure cloud platform.

Our Market Technology business has evolved from its origins serving the capital markets, as we have leveraged NFF to develop our SaaS platform and offerings. We expect to continue to expand adoption by our clients to this SaaS model in the future.

Market Infrastructure Operators (MIO) & New Markets Portfolio

For MIOs, we provide and deliver mission-critical solutions across the trade lifecycle via the NFF, which is our flexible and modular architecture and technology that provides next generation capital markets capabilities in an open and agile environment. The NFF is designed to cover all aspects of a market operator’s needs, from trading and clearing to risk management, market surveillance, index development, data, management, testing, and quality assurance. During 2020, we continued to invest in the NFF by enabling emerging technologies, including integrating technology for issuance and settlement of securities, cloud-enabled trading and clearing, and machine learning applications. In 2020, we also

materially completed development of the core NFF platform and moved to the deployment phase.

Our New Markets initiative is focused on extending the NFF’s capabilities and our expertise as a market operator outside of capital markets. Market Technology currently offers its services to several digital assets exchanges, two commercial real estate markets, the reinsurance market, and several sports wagering operators. Our Marketplaces Services Platform provides next-generation marketplace capabilities spanning the transaction lifecycle to facilitate the exchange of assets, services and information across various types of market ecosystems and machine-to-machine transactions. The Marketplaces Services Platform is targeted at new markets and enables end-to-end marketplace implementation without the resources required with on-premise solutions.

Many MIO and New Markets projects involve complex delivery management and systems integration. Through our integration services, we can assume responsibility for projects that involve migration to a new system and the establishment of entirely new marketplaces. We also offer operation and support for the applications, systems platforms, networks and other components included in an information technology solution, as well as advisory services.

Buy- and Sell-side Portfolio

We continue to expand the NFF offering to the global bank and broker community. Regulatory pressure across multiple jurisdictions has made outsourcing of front-office infrastructure an attractive option for sell-side organizations and, as a result, we offer trading and execution infrastructure for SIs, single-dealer platforms and both multi-lateral and organized trading facilities. Our execution platform business continued its growth in 2020.

We also continue to extend our anti-financial crime strategy. Our Nasdaq Trade Surveillance solution is a managed service designed for brokers and other market participants to assist them in complying with market rules, regulations and internal market surveillance policies. In 2020, we added an anti-money laundering offering with a new automated investigator tool for retail banks, the Nasdaq Automated Investigator. Additionally, in February 2021, we completed the acquisition of Verafin, a provider of anti-financial crime management solutions that provides a cloud-based platform to help detect, investigate, and report money laundering and financial fraud to more than 2,000 financial institutions in North America. We also offer our clients Nasdaq Risk, which is a suite of products that offer a real-time, multi-tiered risk solution that integrates pre-, at- and on-trade risk management, including margining.

Technology

Technology plays a key role in ensuring the growth, reliability and regulation of financial markets. We have established a technology risk program to evaluate the resiliency of critical systems, including risks associated with cybersecurity. This program is focused on identifying areas for improvement in systems, and implementing changes and

upgrades to technology and processes to minimize future risk. We have continued our focus on improving the security of our technology with an emphasis on employee awareness through training, targeted phishing campaigns, and new tool deployment for our securities operations team. See “Item 1A. Risk Factors,” in this Annual Report on Form 10-K for further discussion.

Core Technology. The NFF is Nasdaq’s approach to delivering end-to-end solutions for market infrastructure operators, buy-side firms, sell-side firms and other non-financial markets. The framework consists of a single operational core platform that ties together Nasdaq’s portfolio of functionality across the trade lifecycle, in an open framework whereby exchanges, clearinghouses, central securities depositories, and other entities can easily integrate Nasdaq’s business applications with each other, as well as other third-party solutions. In addition to being able to integrate a broad range of business functions, the NFF enables end users to leverage recent technology developments.

Competitive Strengths

We are a global technology company and we continue to diversify our product and service offerings by having a client-first focus and orientation; unparalleled expertise in markets; a trusted, independent, global brand; unique technology capabilities and reputation; and fostering a leading issuer community and investor intelligence platform. We believe that our strong competitive position in large, high-growth markets positions us for sustained growth.

A Unique Value Proposition

We operate a diverse and resilient capital markets franchise with a marketplace core. Our businesses provide capital-markets infrastructure services to industry players, allowing us to:

• Develop efficient and reliable technologies to facilitate capital markets activity;

• Manage the complexities and costs of business on a global scale; and

• Provide data, tools and insights that drive sound decision making.

Technological Strength

The strength and resiliency of our technology, enhanced by our Market Technology business, in meeting the advancing demands of our global customer base is vital to the continued success of our business and distinguishes us from our competitors.

A Focus on Client Needs Throughout the Marketplace

We strive to serve a diverse range of clients including:

• Brokers and Traders** - Helping brokers and traders to confidently plan, optimize and execute their business vision.

• Market Participants** - Enabling market participants to monitor and capitalize on real-time market changes.

• Investors and Asset Managers** - Offering products and services to assist investors and asset managers in optimizing their portfolios and offerings.

• Listed Companies** - Promoting the capital health of our listed companies.

• Private Companies** - Working with private companies to meet liquidity needs, manage relationships with long-term institutional investors and oversee their entire equity program.

• Market Infrastructure Players** - Assisting market infrastructure players (exchanges, regulators, clearinghouses, and central securities depositories) in increasing efficiency, meeting customer needs and growing revenue.

• Capital-Markets - Delivering efficiencies through economies of scale (cost, speed, connectivity) to all members of the capital-markets ecosystem.

• Banks and Financial Institutions** - Providing a suite of trade surveillance and anti-financial crime management solutions.

Competition

Market Services

We face intense competition in North America and Europe in businesses that comprise our Market Services segment. We seek to provide market participants with greater functionality, trading system stability, speed of execution, high levels of customer service, and efficient pricing. In both North America and Europe, our competitors include other exchange operators, operators of non-exchange trading systems and banks and brokerages that operate their own internal trading pools and platforms.

In the U.S., our options markets compete with exchanges operated by Cboe Global Markets, Inc., or Cboe, Miami International Holdings, Inc., or MIAX, and Intercontinental Exchange, Inc., or ICE. In cash equities in the U.S., we compete with exchanges operated by Cboe, ICE, MIAX, The Investors Exchange, and the recently launched Members Exchange and the Long Term Stock Exchange. We also face

competition from ATSs, known as “dark pools,” and other less-heavily regulated broker-owned trade facilitation systems, as well as from other types of OTC trading. In Canada, our cash equities exchange competes with exchanges such as the Toronto Stock Exchange, or TSX, and other marketplaces.

In Europe, our cash equities markets compete with exchanges such as Euronext N.V., Deutsche Börse AG and London Stock Exchange Group plc, or LSE, and many MTFs such as Cboe, Turquoise and Aquis. Our competitors in the trading and clearing of options and futures on European equities include Eurex, Cboe, ICE Futures Europe and London Clearing House, or LCH. In addition, in equities in Europe we face competition from other broker-owned systems, dark pools, SIs, and other types of OTC trading. Competition among exchanges for trading European equity derivatives tends to occur where there is competition in the trading of the underlying equities. In addition to exchange-based competition, we face competition from OTC derivative markets.

The implementation of MiFID II and MiFIR has resulted in further competitive pressure on our European trading business. SIs are already attracting a significant share of electronically matched volume and we expect such venues to compete aggressively for the trading of equity securities listed on our Nordic exchanges. Different bilateral trading systems pursuing block business also remain active in Europe. As part of this, trading on SIs has increased markedly as volumes migrate from more transparent types of trading venues. Regulators are continuously monitoring the market structure and have, in a series of consultations, asked for input regarding suggested changes to MiFID II.

Our FICC business also operates in an intensely competitive environment. Our trading platform for benchmark U.S. treasuries faces competition from both long-established competitors, such as CME Group Inc. and newly emerging electronic and voice brokerages, and the operating environment remains extremely challenging. Our European fixed income and commodities products and services are subject to relentless competitive pressure from European exchanges and clearinghouses.

Our Trade Management Services business competes with other exchange operators, extranet providers, and data center providers.

Corporate Platforms

Our Listing Services business in both the U.S. and Europe provides a means of facilitating capital formation through public capital markets. There are competing ways of raising capital, and we seek to demonstrate the benefits of listing shares on our exchange. Our primary competitor for larger company stock share listings in the U.S. is NYSE. The Nasdaq Stock Market competes with local and international markets located outside the U.S. for listings of equity securities of both U.S. and non-U.S. companies that choose to list (or dual-list) outside of their home country. For

example, The Nasdaq Stock Market competes for listings with exchanges in Europe and Asia, such as LSE and The Stock Exchange of Hong Kong Limited. Additionally, we face competition from private equity firms that may elect to keep their portfolio companies as private companies.

The Listings Services business in Europe is characterized by a large number of exchanges competing for new or secondary listings. Each country has one or more national exchanges, which are often the first choice of companies in each respective country. For those considering an alternative, competing European exchanges that frequently attract many listings from outside their respective home countries include LSE, Euronext N.V. and Deutsche Börse AG. In addition to the larger exchanges, companies seeking capital or liquidity from public capital markets are able to raise capital without a regulated market listing and can consider trading their shares on smaller markets and quoting facilities.

In our IR & ESG Services business, competition is varied and can be fragmented. For our Investor Relations Intelligence business, there are many regional competitors and relatively few global providers. Other exchange operators are partnering with firms that have capabilities in this area and seeking to acquire relevant assets in order to provide investor relations services to customers alongside listing services. The competitive landscape for our Governance Solutions business varies by customer segment and geography. Most competitors offer SaaS solutions that are supported by a data center strategy. Some firms offer specialized services that focus on a single niche segment. The larger players often offer additional services. Customers frequently seek single-source providers that are able to address a broad range of needs within a single platform. Our ESG-focused services, including Nasdaq OneReport and ESG Advisory, are positioned in evolving markets with competitors offering multiple point solutions providing software, data or consulting services.

Investment Intelligence

Our Market Data business in the U.S. includes both proprietary and consolidated data products. Proprietary data products are made up exclusively of data derived from each exchange’s systems. Consolidated data products are distributed by SEC-mandated consolidators (one for Nasdaq-listed stocks and another for NYSE and other-listed stocks) that share the revenue among the exchanges that contribute data. In Europe, all data products are proprietary, as there is no official data consolidator. Competition in the data business is intense and is influenced by rapidly changing technology and the creation of new product and service offerings.

The sale of our proprietary data products in both the U.S. and Europe is under competitive threat from alternative exchanges and trading venues that offer similar products. Our data business competes with other exchanges and third party vendors to provide information to market participants. Examples of our competitors in proprietary data products are ICE, Cboe, TSX, and Dow Jones & Company.

The consolidated data business is under competitive pressure from other securities exchanges that trade Nasdaq-listed securities. In addition, The Nasdaq Stock Market similarly competes for the tape fees from the sale of information on securities listed on other markets.

Our Index business faces competition from providers of various competing financial indexes. For example, there are a number of indexes that aim to track the technology sector and thereby compete with the Nasdaq-100 Index and the Nasdaq Composite Index. We face competition from investment banks, dedicated index providers, markets and other product developers, including S&P Dow Jones Indices, MSCI and FTSE Russell.

Our Analytics business faces competition from a broad array of data and analytics suppliers, both established firms and small start-ups. Our primary competitors are Morningstar, FactSet, Mercer and any number of smaller firms along with start-up data providers and aggregators. Our Solovis offering competes with other analytics providers, including Addepar and Caissa. Additionally, other large providers to the financial services industry, such as Bloomberg and Refinitiv, are believed to be interested in pursuing certain aspects of the services we provide.

Market Technology

Traditionally, exchanges and exchange-related businesses internally developed technology, sometimes aided by consultants. However, over time this model has changed as many operators have recognized the cost-savings made possible by buying technology from third parties. As a result, two types of competitors have emerged in our Market Technology segment: exchange operators and technology providers unaffiliated with exchanges. These organizations make available a range of off-the-shelf technology, including trading, clearing, market surveillance, settlement, depository and information dissemination, and offer customization and operation expertise. Market conditions in Market Technology are evolving rapidly, which makes continuous investment and innovation a necessity.

A wide range of providers compete with us in surveillance. In surveillance, standardization of products and budget pressures drive customers to focus on pricing. Our competitors range from large enterprise software providers that cover the broader compliance lifecycle to smaller vendors focusing on a single silo of the compliance workflow. Recently, an influx of start-ups have entered the space from the FinTech landscape, often shifting from data and analytics, or a complimentary silo like electronic communications, to surveillance. Our offerings must demonstrate ability to decrease false-positives, provide in-depth views into potential abuses and risks that stem from those cases and help firms both reduce the reputational and regulatory risk and complexity in efforts to keep markets safe.

Intellectual Property

We believe that our intellectual property assets are important for maintaining the competitive differentiation of our products, systems, software and services, enhancing our ability to access technology of third parties and maximizing our return on research and development investments.

To support our business objectives and benefit from our investments in research and development, we actively create and maintain a wide array of intellectual property assets, including patents and patent applications related to our innovations, products and services; trademarks related to our brands, products and services; copyrights in software and creative content; trade secrets; and through other intellectual property rights, licenses of various kinds and contractual provisions. We enter into confidentiality and invention assignment agreements with our employees and contractors, and utilize non-disclosure agreements with third parties with whom we conduct business in order to secure and protect our proprietary rights and to limit access to, and disclosure of, our proprietary information.

We own, or have licensed, rights to trade names, trademarks, domain names and service marks that we use in conjunction with our operations and services. We have registered many of our most important trademarks in the U.S. and in foreign countries. For example, our primary “Nasdaq” mark is a registered trademark that we actively seek to protect in the U.S. and in over 50 other countries worldwide.

Over time, we have accumulated a robust portfolio of issued patents in the U.S. and in many other jurisdictions across the world. We currently hold rights to patents relating to certain aspects of our products, systems, software and services, but we primarily rely on the innovative skills, technical competence and marketing abilities of our personnel. No single patent is in itself core to the operations of Nasdaq or any of its principal business areas.

Corporate Venture Practice

We operate a corporate venture program to make minority investments primarily in emerging growth financial technology companies that are strategically relevant to, and aligned with, Nasdaq. Investments are made through the venture program to further our organic research and development efforts and accelerate the path to commercial viability. We expect that capital invested will continue to be modest and will not have a material impact on our consolidated financial statements, existing capital return or deployment priorities. Since its inception in 2017, our venture program has grown, with aggregate initial and follow-on investments of approximately $67 million in 15 companies in various sectors, including data and analytics, blockchain and digital assets, market infrastructure, machine intelligence and regulatory technology and compliance, ESG and new marketplaces.

Environmental, Social and Governance Matters

Nasdaq is committed to long-term ESG, advocacy, oversight, and philanthropy to engage with stakeholders at all levels. During 2020, particularly in response to the COVID-19 pandemic and the social justice movement, we broadened our corporate and community ESG efforts, including expanding ESG oversight of our own operations and furthering our commitment to greater sustainability. Nasdaq achieved its continued commitment to be carbon neutral across all business operations through the purchase of green power, carbon offsets, and renewable energy certificates. We were named to the Dow Jones Sustainability North America Index for the fifth consecutive year. We also expanded our ESG services and solutions with new offerings for our clients, including our new platform Nasdaq OneReport to help clients streamline the data gathering process to provide data to ratings agencies, the Nasdaq Sustainable Bond Network, which provides access to detailed information on sustainable, green and social bonds and allows investors to obtain detailed information on sustainable bonds for product due diligence, selection and monitoring, the Nasdaq ESG Data Portal, which now includes ESG-related data from more than 600 companies and the Nasdaq ESG Footprint, a tool to help both institutional and retail investors understand the real-life impact of their portfolios. We also provide clients with counsel on a range of governance and sustainability-related issues.

Additionally, we filed a new proposed U.S. listing rule with the SEC that seeks to standardize disclosure of board-level diversity statistics through a consistent disclosure framework. The proposal includes disclosure of either the recommended minimum diversity goal of two diverse directors or an explanation, and is subject to SEC approval.

For more information regarding our ESG efforts in 2020, both internally and externally, please see the section entitled “Human Capital Management” below and our 2021 Proxy Statement.

Regulation

We are subject to extensive regulation in the U.S., Canada and Europe.

U.S. Regulation

U.S. federal securities laws establish a system of cooperative regulation of securities markets, market participants and listed companies. SROs conduct the day-to-day administration and regulation of the nation’s securities markets under the close supervision of, and subject to extensive regulation, oversight and enforcement by, the SEC. SROs, such as national securities exchanges, are registered with the SEC.

This regulatory framework applies to our U.S. business in the following ways:

• regulation of our registered national securities exchanges; and

• regulation of our U.S. broker-dealer and investment advisor subsidiaries.

National Securities Exchanges. SROs in the securities industry are an essential component of the regulatory scheme of the Exchange Act for providing fair and orderly markets and protecting investors. The Exchange Act and the rules thereunder, as well as each SRO’s own rules, impose many regulatory and operational responsibilities on SROs, including the day-to-day responsibilities for market and broker-dealer oversight. Moreover, an SRO is responsible for enforcing compliance by its members, and persons associated with its members, with the provisions of the Exchange Act, the rules and regulations thereunder, and the rules of the SRO, including rules and regulations governing the business conduct of its members.

Nasdaq currently operates three cash equity, six options markets and one corporate bond market in the U.S. We operate The Nasdaq Stock Market, The Nasdaq Options Market and the Corporate Bond Market pursuant to The Nasdaq Stock Market’s SRO license; Nasdaq BX and Nasdaq BX Options pursuant to Nasdaq BX’s SRO license; Nasdaq PSX and Nasdaq PHLX pursuant to Nasdaq PHLX’s SRO license; and Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX, each of which operates an options market under its own SRO license. As SROs, each entity has separate rules pertaining to its broker-dealer members and listed companies. Broker-dealers that choose to become members of our exchanges are subject to the rules of those exchanges.

All of our U.S. national securities exchanges are subject to SEC oversight, as prescribed by the Exchange Act, including periodic and special examinations by the SEC. Our exchanges also are potentially subject to regulatory or legal action by the SEC at any time in connection with alleged regulatory violations. We have been subject to a number of routine reviews and inspections by the SEC or external auditors in the ordinary course, and we have been and may in the future be subject to SEC enforcement proceedings. To the extent such actions or reviews and inspections result in regulatory or other changes, we may be required to modify the manner in which we conduct our business, which may adversely affect our business.

Section 19 of the Exchange Act provides that our exchanges must submit to the SEC proposed changes to any of the SROs’ rules, practices and procedures, including revisions to provisions of our certificate of incorporation and by-laws that constitute SRO rules. The SEC will typically publish such proposed changes for public comment, following which the SEC may approve or disapprove the proposal, as it deems appropriate. SEC approval requires a finding by the SEC that the proposal is consistent with the requirements of the Exchange Act and the rules and regulations thereunder. Pursuant to the requirements of the Exchange Act, our exchanges must file with the SEC, among other things, all proposals to change their pricing structure.

Nasdaq conducts real-time market monitoring, certain equity surveillance not involving cross-market activity, most options

surveillance, rulemaking and membership functions through our Nasdaq Regulation department. We review suspicious trading behavior discovered by our regulatory staff, and depending on the nature of the activity, may refer the activity to FINRA for further investigation. Pursuant to regulatory services agreements between FINRA and our SROs, FINRA provides certain regulatory services to our markets, including some regulation of trading activity and surveillance and investigative functions. Our SROs retain ultimate regulatory responsibility for all regulatory activities performed under regulatory agreements by FINRA, and for fulfilling all regulatory obligations for which FINRA does not have responsibility under the regulatory services agreements.

In addition to its other SRO responsibilities, The Nasdaq Stock Market, as a listing market, also is responsible for overseeing each listed company’s compliance with The Nasdaq Stock Market’s financial and corporate governance standards. Our listing qualifications department evaluates applications submitted by issuers interested in listing their securities on The Nasdaq Stock Market to determine whether the quantitative and qualitative listing standards have been satisfied. Once securities are listed, the listing qualifications department monitors each issuer’s on-going compliance with The Nasdaq Stock Market’s continued listing standards.

Broker-dealer regulation. Nasdaq’s broker-dealer subsidiaries are subject to regulation by the SEC, the SROs and various state securities regulators. Nasdaq operates five broker-dealers: Nasdaq Execution Services, LLC, Execution Access, LLC, NPM Securities, SMTX, LLC, and Nasdaq Capital Markets Advisory LLC. Each broker-dealer is registered with the SEC, a member of FINRA and registered in the U.S. states and territories required by the operation of its business.

Nasdaq Execution Services operates as our routing broker for sending orders from Nasdaq's U.S. cash equity and options exchanges to other venues for execution. SMTX acts as an intermediary to facilitate closings of, and introduce prospective accredited investors in connection with, private non-capital raising transactions. Nasdaq Capital Markets Advisory acts as a third-party advisor to privately-held or publicly-traded companies during IPOs and various other offerings.

Two of our broker-dealers also are registered with the SEC as ATSs. Execution Access operates as the broker-dealer for our fixed income business, including as Nasdaq Fixed Income’s registered ATS for U.S. Treasury securities. NPM Securities operates an ATS that facilitates the purchase and sale of ownership interests in primary and secondary transactions in certain funds (both registered or not registered under the Investment Company Act of 1940), business development companies, certain closed end funds and private real estate investment funds.

The SEC, FINRA and the exchanges adopt rules and examine broker-dealers and require strict compliance with their rules and regulations. The SEC, SROs and state securities commissions may conduct administrative proceedings which

can result in censures, fines, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer, its officers or employees. The SEC and state regulators may also institute proceedings against broker-dealers seeking an injunction or other sanction. All broker-dealers have an SRO that is assigned by the SEC as the broker-dealer’s Designated Examining Authority. The Designated Examining Authority is responsible for examining a broker-dealer for compliance with the SEC’s financial responsibility rules. FINRA is the current Designated Examining Authority for each of our broker-dealer subsidiaries.

Our registered broker-dealers are subject to regulatory requirements intended to ensure their general financial soundness and liquidity, which require that they comply with certain minimum capital requirements. As of December 31, 2020, each of our broker-dealers were in compliance with all of the applicable capital requirements.

Regulatory contractual relationships with FINRA. Our SROs have signed a series of regulatory service agreements covering the services FINRA provides to the respective SROs. Under these agreements, FINRA personnel act as our agents in performing the regulatory functions outlined above, and FINRA bills us a fee for these services. These agreements have enabled us to reduce our headcount while ensuring that the markets for which we are responsible are properly regulated. However, we have reduced the scope of services provided by FINRA under these regulatory services agreements and are performing certain of those regulatory functions directly. In addition, our SROs retain ultimate regulatory responsibility for all regulatory activities performed under these agreements by FINRA.

Exchange Act Rule 17d-2 permits SROs to enter into agreements, commonly called Rule 17d-2 agreements, approved by the SEC with respect to enforcement of common rules relating to common members. Our SROs have entered into several such agreements under which FINRA assumes regulatory responsibility for specifics covered by the agreement, including:

• agreements with FINRA covering the enforcement of common rules, the majority of which relate to the regulation of common members of our SROs and FINRA;

• joint industry agreements with FINRA covering responsibility for enforcement of insider trading rules;

• joint industry agreement with FINRA covering enforcement of rules related to cash equity sales practices and certain other non-market related rules; and

• joint industry agreement covering enforcement of rules related to options sales practices.

Regulation NMS and Options Intermarket Linkage Plan. We are subject to Regulation NMS for our cash equity markets, and our options markets have joined the Options Intermarket Linkage Plan. These are designed to facilitate the routing of orders among exchanges to create a national market system

as mandated by the Exchange Act. One of the principal purposes of a national market system is to assure that brokers may execute investors’ orders at the best market price. Both Regulation NMS and the Options Intermarket Linkage Plan require that exchanges avoid trade-throughs, locking or crossing of markets and provide market participants with electronic access to the best prices among the markets for the applicable cash equity or options order.

In addition, Regulation NMS requires that every national securities exchange on which an NMS stock is traded and every national securities association act jointly pursuant to one or more national market system plans to disseminate consolidated information, including a national best bid and national best offer, on quotations for transactions in NMS stocks, and that such plan or plans provide for the dissemination of all consolidated information for an individual NMS stock through a single plan processor.

The UTP Plan was filed with and approved by the SEC as a national market system plan in accordance with the Exchange Act and Regulation NMS to provide for the collection, consolidation and dissemination of such information for Nasdaq-listed securities. The Nasdaq Stock Market serves as the processor for the UTP Plan pursuant to a contract that was recently extended for a two-year term through October 2023. The Nasdaq Stock Market also serves as the administrator for the UTP Plan. To fulfill its obligations as the processor, The Nasdaq Stock Market has designed, implemented, maintained, and operated a data processing and communications system, hardware, software and communications infrastructure to provide processing for the UTP Plan. As the administrator, The Nasdaq Stock Market manages the distribution of market data, the collection of the resulting market data revenue, and the dissemination of that revenue to plan members in accordance with the terms of the UTP Plan and of Regulation NMS.

In May 2020, the SEC adopted an order to require changes to the governance of securities information processors. The SEC also approved, with material amendments, SRO proposed policies regarding the governance of these entities. In June and July 2020, we and several other exchanges petitioned the U.S. Court of Appeals for the District of Columbia Circuit to review both the SEC’s governance order and its amendments to the SRO-proposed policies. In December 2020, the SEC adopted a rule to modify the infrastructure for the collection, consolidation and dissemination of market data for exchange-listed national market stocks, or NMS data. The rule changes include, among other things, requiring exchanges to add more “core data” to the securities information processors, including partial depth-of-book, certain odd-lot quotations/transactions, auction, regulatory, and administrative data; eliminating central, official consolidators of tape plans and enables multiple competing consolidators to register to aggregate and disseminate core data; and authorizing persons to purchase and aggregate core data directly from the exchanges for their own use. The rule implementation schedule has not yet been finalized by the SEC, and we are not certain of the timing, or

the impact, of these new rules on our business or role as a securities information processor. In February 2021, we petitioned the U.S. Court of Appeals for the District of Columbia Circuit to review the SEC’s rulemaking. In addition, we requested the SEC to stay implementation of the rule.

Regulation SCI. Regulation SCI is a set of rules designed to strengthen the technology infrastructure of the U.S. securities markets. Regulation SCI applies to national securities exchanges, operators of certain ATSs, market data information providers and clearing agencies, subjecting these entities to extensive new compliance obligations, with the goals of reducing the occurrence of technical issues that disrupt the securities markets and improving recovery time when disruptions occur. We implemented an inter-disciplinary program to ensure compliance with Regulation SCI. Regulation SCI policies and procedures were created, internal policies and procedures were updated, and an information technology governance program was developed to ensure compliance.

Regulation of Registered Investment Advisor Subsidiary. Our subsidiary NDW is an investment advisor registered with the SEC under the Investment Advisors Act of 1940. In this capacity, NDW is subject to oversight and inspections by the SEC. Among other things, registered investment advisors like NDW must comply with certain disclosure obligations, advertising and fee restrictions and requirements relating to client suitability and custody of funds and securities. Registered investment advisors are also subject to anti-fraud provisions under both federal and state law.

CFTC Regulation. The Dodd-Frank Wall Street Reform and Consumer Protection Act also has resulted in increased CFTC regulation of our use of certain regulated derivatives products, as well as the operations of some of our subsidiaries outside the U.S. and their customers.

Canadian Regulation

Regulation of Nasdaq Canada is performed by the Canadian Securities Administrators, an umbrella organization of Canada’s provincial and territorial securities regulators. As a recognized exchange in Ontario, Nasdaq Canada must comply with the terms and conditions of its exchange recognition order. While exempt from exchange recognition in each jurisdiction in Canada other than Ontario where Nasdaq Canada carries on business, Nasdaq must comply with the terms and conditions of an exemption order granted by the other jurisdictions. Oversight of the exchange is performed by Nasdaq Canada’s lead regulator, the Ontario Securities Commission. Additionally, Nasdaq Fixed Income provides access to Canadian-based “Permitted Clients” for trading non-Canadian fixed income securities and is subject to Canadian securities regulations in connection with providing these services.

Nasdaq Canada is subject to several national marketplace related instruments which set out requirements for marketplace operations, trading rules and managing

electronic trading risk. Exchange terms and conditions include but are not limited to, requirements for, governance, regulation, rules and rulemaking, fair access, conflict management and financial viability.

European Regulation

Regulation of our markets in the European Union and the European Economic Area focuses on matters relating to financial services, listing and trading of securities, clearing and settlement of securities and commodities as well as issues related to market abuse.

In July 2016, the European Union’s Market Abuse Regulation, which is intended to prevent market abuse, entered into force. MiFID II and MiFIR entered into force in January 2018 and primarily affect our European trading businesses. Many of the provisions of MiFID II and MiFIR are implemented through technical standards drafted by the European Securities and Markets Authority and approved by the European Commission. In addition, in 2016, the European Union adopted legislation on governance and control of the production and use of benchmark indexes. The Benchmark Regulation applies in the European Union from early 2018. However, due to transitional clauses in the Benchmark Regulation, Nasdaq as a benchmark provider, did not need to be in compliance with the Benchmark Regulation until January 1, 2020 in relation to benchmarks provided by Nasdaq’s European subsidiaries, or until January 1, 2024, in relation to benchmarks provided by non-European Nasdaq entities. As the regulatory environment continues to evolve and related opportunities arise, we intend to continue developing our products and services to ensure that the exchanges and clearinghouse that comprise Nasdaq Nordic and Nasdaq Baltic maintain favorable liquidity and offer fair and efficient trading.

The entities that operate trading venues in the Nordic and Baltic countries are each subject to local regulations. As a result, we have a strong local presence in each jurisdiction in which we operate regulated businesses. The regulated entities have decision-making power and can adopt policies and procedures and retain resources to manage all operations subject to their license. In Sweden, general supervision of the Nasdaq Stockholm exchange is carried out by the SFSA, while Nasdaq Clearing’s role as CCP in the clearing of derivatives is supervised by the SFSA and overseen by the Swedish central bank (Riksbanken). Additionally, as a function of the Swedish two-tier supervisory model, certain surveillance in relation to the exchange market is carried out by the Nasdaq Stockholm exchange, through its surveillance function.

Nasdaq Stockholm’s exchange activities are regulated primarily by the SSMA, which implements MiFID II into Swedish law and which sets up basic requirements regarding the board of the exchange and its share capital, and which also outlines the conditions on which exchange licenses are issued. The SSMA also provides that any changes to the exchange’s articles of association following initial

registration must be approved by the SFSA. Nasdaq Clearing holds the license as a CCP under EMIR.

With respect to ongoing operations, the SSMA requires exchanges to conduct their activities in an honest, fair and professional manner, and in such a way as to maintain public confidence in the securities markets. When operating a regulated market, an exchange must apply the principles of free access (i.e., that each person which meets the requirements established by law and by the exchange may participate in trading), neutrality (i.e., that the exchange’s rules for the regulated market are applied in a consistent manner to all those who participate in trading) and transparency (i.e., that the participants must be given speedy, simultaneous and correct information concerning trading and that the general public must be given the opportunity to access this information). Additionally, the exchange operator must identify and manage the risks that may arise in its operations, use secure technical systems and identify and handle the conflicts of interest that may arise between the exchange or its owners’ interests and the interest in safeguarding effective risk management and secure technical systems. Similar requirements are set up by EMIR in relation to clearing operations.

The SSMA also contains the framework for both the SFSA’s supervisory work in relation to exchanges and clearinghouses and the surveillance to be carried out by the exchanges themselves. The latter includes the requirement that an exchange should have “an independent surveillance function with sufficient resources and powers to meet the exchange’s obligations.” That requires the exchange to, among other things, supervise trading and price information, compliance with laws, regulations and good market practice, participant compliance with trading participation rules, financial instrument compliance with relevant listing rules and the extent to which issuers meet their obligation to submit regular financial information to relevant authorities.

The regulatory environment in the other Nordic and Baltic countries in which a Nasdaq entity has a trading venue is broadly similar to the regulatory environment in Sweden. Since 2005, there has been cooperation between the supervisory authorities in Sweden, Iceland, Denmark and Finland, which looks to safeguard effective and comprehensive supervision of the exchanges comprising Nasdaq Nordic and the systems operated by it, and to ensure a common supervisory approach. In 2019, the supervisory authority in Norway joined this cooperation.

Nasdaq owns a central securities depository known as Nasdaq CSD SE (Societas Europaea)¸ that provides notary, settlement, central maintenance and other services in the Baltic countries and in Iceland. Nasdaq CSD SE is licensed under the European Central Securities Depositories Regulation and is supervised by the respective regulatory institutions.

We operate a licensed exchange, Nasdaq Oslo ASA, in Norway that trades and lists commodity derivatives. Although Norway is not a member of the EU, as a result of

the European Economic Area, or EEA, agreement (agreement on the EEA entered into between the EU and European Free Trade Association) the regulatory environment is broadly similar to what applies in EU member states. In addition, in January 2019 new legislation entered into force in Norway mirroring the provisions of MiFID II and MIFIR. As a result, the regulatory environment in Norway is similar to Sweden. The Financial Supervisory Authority of Norway supervises the Norwegian exchange on an autonomous basis and the Norwegian exchange also has a separate market surveillance function overseen by the Financial Supervisory Authority.

Confidence in capital markets is paramount for trading to function properly. Nasdaq Nordic carries out market surveillance through an independent unit that is separate from the business operations. The surveillance work is conceptually organized into two functions: one for the review and admission of listing applications and surveillance activities related to issuers (issuer surveillance) and one for surveillance of trading (trading surveillance). The real-time trading surveillance for the Finnish, Icelandic, Danish and Swedish markets has been centralized to Stockholm. In addition, there are special personnel who carry out surveillance activities at Nasdaq Oslo and each of the three Baltic exchanges. In Finland and Sweden, decisions to list new companies on the main market are made by listing committees that have external members in addition to members from each respective exchange and in the other countries the decision is made by the respective president of the exchange.

If there is suspicion that a listed company or member has acted in breach of exchange regulations, the matter is handled by the respective surveillance department. Serious breaches are considered by the respective disciplinary committee in Denmark, Finland, Iceland, Sweden and Norway. Suspected insider trading is reported to the appropriate authorities in the respective country.

In the United Kingdom, The Nasdaq Stock Market and Nasdaq Oslo ASA are each subject to regulation by the Financial Conduct Authority as “Recognised Overseas Investment Exchanges.” Exchanges in Sweden, Denmark, and Finland have applied for status as “Recognised Overseas Investment Exchanges” and we expect these exchanges to receive such status during 2021. Pending approval, we are able to operate in the United Kingdom under the overseas person exemption. Nasdaq Clearing is registered as a recognized third country CCP with the Bank of England under the temporary recognition regime. The registration became effective on December 31, 2020, and lasts for three years. We will be applying for permanent recognition within eighteen months of the end of this implementation period.

Human Capital Management

Nasdaq’s commitment to, and investment in, attracting, retaining, developing and motivating its employees strengthened during 2020, and while the COVID-19 pandemic has created certain challenges for our employees, we have bolstered our human capital management efforts

throughout the past year. We have built on our existing foundation of striving to create a diverse and inclusive work environment of equal opportunity, where employees feel respected and valued for their contributions, and where Nasdaq and its employees have opportunities to make positive contributions to our local communities and to social justice initiatives.

As of December 31, 2020, we had 4,830 employees.

ESG Oversight

The Nominating & ESG Committee has formal responsibility and oversight for ESG policies and programs and receives regular reporting on key ESG matters and initiatives. Our internal ESG Working Group is co-chaired by executive leaders and comprised of geographically diverse representatives from multiple business units. The ESG Working Group serves as the central oversight body for our ESG strategy.

COVID-19 and Employee Safety

As the COVID-19 pandemic continues around the world, affecting all of our offices, we are committed to ensuring the safety and well-being of our employees and stakeholders, and complying with local government regulations in the areas in which we operate. This includes having the vast majority of our employees work from home, while implementing additional safety measures and precautions for employees continuing critical on-site work in certain of our offices. We have informed our employees that they may continue to work remotely through at least June 30, 2021, and we will continue to evaluate local conditions and regulations before we fully transition back to our offices.

Talent Management and Development

We continued to increase our efforts in attracting and retaining our employees.

Nasdaq seeks to hire world-class, innovative, and diverse talent across the globe. We recently strengthened our employer brand strategy with an updated “People Promise,” which encapsulates Nasdaq’s vision, mission, purpose and employment experience in order to become a leading company for highly sourced talent. In addition, we created a new diversity recruiting function to help us attract talent using innovative new techniques and channels.

We introduced new onboarding and exit surveys to better understand why employees join, and leave, Nasdaq. We conducted annual performance management, succession planning and advancement exercises to ensure we are aligning our employees with the right opportunities across the company. Additionally, we introduced a peer-to-peer employee recognition program. Finally, as a result of COVID-19 restrictions, we reinvented our internship program to remotely welcome 151 interns to Nasdaq.

We have invested in professional development for our employees, including offering access to more than 14,000 professional development programs; providing tuition

assistance to employees enrolled in degree-granting academic programs; holding internal career fairs and career development programs; and providing one-on-one professional coaching opportunities.

Diversity and Inclusion

In 2020, we established three pillars to guide our diversity and inclusion efforts with our employees: Workforce, to ensure our employee population is representative of the communities in which we operate; Workplace, to ensure a positive workplace experience for all employees of Nasdaq; and Marketplace, to positively influence our peers in the capital market space and to invest in our local communities in which we operate.

Nasdaq sponsors eleven employee-led internal affinity networks. These networks include more than 1,500 employee members to support the diverse communities that comprise our workforce, and include networks for our Black, Asian American, Hispanic, LGBTQ, female, disabled, veteran, and parent/caregiver employees. The networks provide both formal and informal development programs and guidance for their members, and benefit the entire Nasdaq workforce through educational events, guest speakers, and volunteering opportunities.

We created a dedicated diversity recruiting function to further our recruiting efforts and enhance the representation of women and minorities at Nasdaq. In order to monitor our diversity efforts on an ongoing basis, each business unit has a dashboard reflecting the diversity of their employee population and can track changes on a monthly basis. We launched a new “Inclusive Leadership” training program for all employees, starting with our Chief Executive Officer and senior executives. We also added customized developmental programs for underrepresented talent, including executive mentoring and accelerated leadership development programs. Additionally, as a signatory to the Parity Pledge, we fulfilled our commitment to interview female candidates for all externally advertised roles at the Vice President level and above.

On a company-wide basis, as the social justice movement gained momentum in 2020, we hosted a series of educational discussions for all of our employees featuring internal and external guest speakers addressing racial dynamics in our society and fostering greater understanding in the workplace. In honor of Juneteenth, we debuted “Amplifying Black Voices,” a series of art by Black artists displayed on the Nasdaq Tower in New York’s Times Square.

Finally, Nasdaq published statistics on the composition of its own global workforce by gender, and of its U.S. workforce by gender, race and ethnicity, in our U.S. EEO-1 report and our Sustainability Report, which reports are available on our website.

Compensation and Benefits

Our Total Rewards compensation program is designed to attract, retain, and empower employees to successfully execute our growth strategy. Nasdaq’s balanced Total

Rewards program encourages decisions and behaviors that align with the short and long-term interests of our shareholders. The building blocks of our Total Rewards program are designed to promote and support our strategy and reinforce our cultural values of: Act as an Owner, Play as a Team, Fuel Client Success, Lead with Integrity, Expand Your Expertise, and Drive Innovation. Our Company values energize and align employees with the most important priorities, and encourage and reward high levels of performance, innovation and growth, while not promoting undue risk. Our compensation program seeks to retain our most talented employees in a highly dynamic, competitive talent market, while also engaging and exciting current and future employees who possess the leading skills and competencies needed for us to achieve our strategy and objectives. The Total Rewards compensation program is comprised of base salary, an annual cash bonus incentive program and long-term equity incentive awards. The long-term equity awards align our employee interests with our shareholders.

In addition to cash and equity compensation, we also offer employee benefits such as health (medical, dental, vision and telehealth) insurance, paid time off, paid parental leave, adoption assistance and a U.S. 401(k) Plan with company matching. We also introduced additional new benefits this year as a result of the COVID-19 pandemic in an effort to help our employees with the additional stress in balancing their work and personal commitments, including providing “flex days” for additional time away from the office without requiring the usage of vacation or personal leave days, additional family care resources and benefits, including back-up childcare and other caregiver support, wellness benefits, and student loan repayment benefits. We also provide additional benefits to our international employees based on local regulations and practice to address market-specific needs.

Community Involvement

We are committed to creating lasting, positive change within our Company and the communities we serve, and increased our community involvement during 2020, both as a result of the COVID-19 pandemic and the heightened focus on social inequality in the United States.

Our employees take pride in being active in our communities. Through our Nasdaq GoodWorks Corporate Responsibility Program, we have committed to supporting the communities in which we live and work by providing eligible full and part-time employees two paid days off per year to volunteer. We also match charitable donations of all Nasdaq employees and contractors up to $1,000, or more in certain circumstances, per calendar year, and during 2020, we offered additional, higher matching programs for employee donations to global COVID-19 relief and response organizations and other charities selected by the Nasdaq employee networks. While most of our in-person volunteer efforts in 2020 pivoted to virtual volunteering events due to the pandemic, we still organized more than 90 volunteer events around the world,

and more than 260 associates volunteered and contributed over 2,600 service hours.

In 2020, we announced actions to strengthen our continued commitment to diversity and inclusion and donated an aggregate of $7 million, including $6 million in cash, to organizations serving underserved, minority communities in fighting the impact of the COVID-19 health crisis. These organizations included the Equal Justice Initiative, the NAACP’s COVID-19 project and World Central Kitchen’s Restaurants for the People. Additionally, we contributed $10 million to support the Nasdaq Foundation and plan to annually fund the Nasdaq Foundation with approximately one quarter of one percent of our operating profits beginning in 2021.

In September 2020, we launched the “Purpose Initiative,” which is designed to advance inclusive growth and prosperity. The Purpose Initiative comprises our philanthropic, community outreach, corporate sustainability, and employee volunteerism programs, all designed to leverage our unique place at the center of capital creation, markets, and technology and drive stronger economies, more equitable opportunities and contribute to a more sustainable world. We also relaunched the Nasdaq Foundation in September 2020, with a renewed mission focused on two primary goals: (i) reimagining investor engagement to equip under-represented communities with the financial knowledge to share in the wealth that markets create; and (ii) leveraging our investment in the Nasdaq Entrepreneurial Center alongside new strategic partnerships with organizations that can help build a deeper, data-led understanding of where the challenges are greatest, what existing efforts could be amplified, and how the Nasdaq Foundation can make new and distinctive contributions.

Nasdaq Website and Availability of SEC Filings

We file periodic reports, proxy statements and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is http://www.sec.gov.

Our website is http://ir.nasdaq.com. Information on our website is not a part of this Form 10-K. We make available free of charge on our website, or provide a link to, our Forms 10-K, Forms 10-Q and Forms 8-K and any amendments to these documents, that are filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. To access these filings, go to Nasdaq’s website and click on “Financials” then click on “SEC Filings.”