Regarding short sales, NIRI issued a press release (pdf) yesterday announcing the results of our recent short selling member survey. NIRI survey respondents overwhelmingly favor additional reforms to ensure short selling is not abused. Today, I am attending an SEC roundtable meeting on this issue, and will report next week on the discussion. In the next few weeks, NIRI will submit public comments on the SEC’s proposed REG SHO short sale amendments (pdf). This past week, NIRI submitted comments (pdf) to IOSCO (International Organization of Securities Commissions) in response to its request for public comments on a short selling consultation report (pdf). I expect similar letters to be submitted by other peer international IR organizations as NIRI’s response was developed in coordination with several members of GIRN (Global Investor Relations Network) – an organization of global IR organizations
NEWS RELEASE
For Immediate Release: May 4, 2009
NIRI Survey Respondents Strongly Support SEC’s Proposed Short Sale Reforms
Vienna, VA – The National Investor Relations Institute (NIRI), the largest association of public company investor relations professionals in the world, today announced that a significant majority of members responding to a recent survey support short sale reforms, including those contained in the proposed amendments to Regulation SHO by the U.S. Securities and Exchange Commission (SEC).
NIRI conducted a member survey from April 23, 2009 to May 1, 2009 to aggregate their opinions and experiences regarding short selling. Approximately 7.5%, or 295, NIRI members participated in the survey. The results indicate strong support for short sale reforms among survey respondents:
• 91% favor a market-wide short sale uptick rule
• 71% favor a single-stock short sale circuit breaker
• 90% favor making the temporary prohibition of “naked” short sales permanent
• 96% favor public short position reporting similar to long position reporting
“NIRI applauds the SEC for taking up this comprehensive examination of short-selling,” said Jeff Morgan, President and CEO of NIRI. “NIRI agrees with the Commission that short selling provides important market benefits such as liquidity and pricing efficiency, but that short selling may also be used to illegally manipulate stock prices. NIRI supports a comprehensive evaluation of market stabilizing systems and processes during times of extreme volatility such as some form of short selling uptick rule or circuit breakers. Additionally, NIRI supports equity ownership position transparency – full and frequent ownership disclosure by all institutional investors including long positions, short positions and derivative positions. We plan to include these important survey results in NIRI’s upcoming Reg SHO comment letter to the SEC.”
