The International Organization of Securities Commissions (IOSCO) has published a consultation report concerning conflicts of interest and associated conduct risks during the equity capital raising process.
The consultation report covers the key stages of the equity raising process where the role of intermediaries might give rise to conflicts of interest, and it requests public comment on IOSCO’s proposed guidance for tackling these issues. The proposed guidance comprises eight measures that are grouped according to the various stages in the capital raising process. Each group of measures addresses the following specific conflicts of interest:
- guidance to address conflicts of interest and pressure on analysts during the formative, pre-offering phase of a capital raising;
- guidance to address conflicts of interest during the allocation of securities;
- guidance to address conflicts of interest in the pricing of securities offerings; and
- guidance to address conflicts of interest and conduct risks stemming from personal transactions by staff employed within firms managing a securities offering.
The guidance would not be binding, but IOSCO members would be encouraged to consider it in the context of their legal and regulatory framework.
The deadline for comments on the consultation report is 4 April 2018.