Press Releases

SEC Division of Corporation Finance Director Testifies Before Subcommittee


Washington, April 26, 2018 -

The Subcommittee on Capital Markets, Securities, and Investment held a hearing today to review the Securities and Exchange Commission’s (SEC) Division of Corporation Finance and analyze how recent activities and future agenda items by the Division will advance the SEC’s mission to both protect investors and facilitate capital formation. 

"We must continue to make pro-growth reforms that ensure the United States has the strongest, deepest, and most liquid markets in the world," said Subcommittee Chairman Bill Huizenga (R-MI). "Our shared goal should be to reverse the negative trend of declining IPO’s and focus on capital formation. Hardworking families across the nation rely on the capital markets to save for everything from college to retirement.  By making capital formation the priority we can maximize Mr. and Mrs. 401(k)’s return on investment, expand opportunity, increase job creation, and grow our economy."

Key Takeaways

  • Given the decline in IPOs and public companies, the SEC should continually reevaluate their regulations that affect the ability of companies to go public to ensure that investors have access to material information.
  • The federal securities laws are not the avenue to advance social and political agendas. Instead, they should focus on ensuring that investors have access to information that supports long-term growth and shareholder value. 
  • The SEC should ensure that guidance and rules for investor disclosures are clear so that companies can follow and comply with the federal securities laws.  

Topline Quotes from the Witness

“Against the backdrop of a declining number of U.S. public reporting companies, the Division has been looking at ways to make the public company alternative more attractive. While there are many reasons why companies may choose not to go public, to go public at a later stage, or to exit the public markets, to the extent we are able to attract more companies to join our public company reporting system and do so at an earlier stage, it will ultimately benefit companies, our markets and investors. Companies that go through the evolution from a private company to a public reporting company emerge as better companies with better disclosure. Markets as a whole benefit from the increased transparency and the better-informed price discovery that occurs when more companies participate in the public markets. Investors benefit when there are more companies in which to invest..” – William Hinman, Division of Corporation Finance, U.S. Securities and Exchange Commission

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