MiFID II – A practical update for members on developments so far

The IR Society policy committee recently published a practical update for IROs on MiFID II developments so far and their view on how the market is changing. The full 15 point guide is available to IR Society members.

1. What have been the implications for corporate issuers, and what changes do we expect following MiFID implementation?
Following implementation on January 3, 2018, there has been much debate among the sell-side, investors and corporate issuers on the impact. It is clear significant changes are beginning and this is evolving and the implications for research, corporate access, analyst consensus and feedback will continue to play out over the next six to 12 months.  

2. Should I still be using brokers for roadshows?
Yes, if your house brokers are offering roadshows they can continue to provide a useful service to corporate issuers. You should note that in theory your house brokers can contact all investors who you request to arrange a meeting as in effect that meeting has been paid for (within the house broker retainer). All corporates should nevertheless take steps to understand which of their shareholders and potential shareholders their broker(s) have corporate access arrangements in place with. It’s also important to be aware that in practice, many investors are choosing to arrange all meetings themselves as the responsibility is theirs to make sure the meeting has been ‘paid for’ and many are taking great caution not to make any errors on this point. In addition, giving a few days roadshow to a non-house broker will now be much harder, as they will in theory be restricted to only arranging meetings with investors with whom they have a signed research/corporate access agreement.   It is also important to retain control over targeting and roadshow schedules to ensure there are no gaps and efficient use is made of the IROs and management’s time.

The full 15-point guide is available to signed-in IR Society members in the Policy & Regulation section of the Knowledge Bank. You can access it here

Contributed by: The IR Society policy committee; Laura Hayter, head of policy and communications; The IR Society; and Emma Burdett, chair of The IR Society's policy committee.
Contact Laura on: laura.hayter@irsociety.org.uk 

Published 26 July, 2018

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