SEC should use Musk to transition to new age

The US Securities and Exchange Commission should take the opportunity of errant tweeting from Tesla boss Elon Musk to figure out how it transitions to a more modern way of regulating market communication.

  • By Sam Kerr
  • 09 Apr 2019
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A US district judge has ruled that the SEC and Musk must look into how the tech entrepreneur should conduct himself on social media and what pre-approvals he should be required to have before tweeting possibly incorrect information about Tesla on Twitter, inviting Musk to put on his “reasonableness pants”.

But the regulator should also take the opportunity to create a market information regime more suitable for the Twitter era.

The dispute between the regulator and the billionaire came after Musk posted misleading Tesla production numbers on the social media site, without pre-approval.

This was deemed by the SEC to be in breach of an earlier agreement Musk and Tesla reached with the SEC. The agreement followed Musk’s tweet that he was considering taking Tesla private at $420 a share, an offer which, it turned out, had little chance of success and had no financing attached.

The SEC determined Musk’s tweet was both “false and misleading”.

Both parties have a fortnight to come up with a regime that will stop Musk potentially misleading shareholders with his seemingly unfettered 280 character utterances.

But the agency should use this as an opportunity to trial a system that can be applied to all CEOs of listed stocks.

There is an age-old adage that anyone designing anything new should make it so simple a child can use it.

Therefore, what better test subject for a new social media based-investor communications regime than the petulant Musk.

The Tesla CEO has responded to SEC sanctions as a teenager would to a scolding parent. Other bizarre Twitter rants include calling a British rescue diver a “pedo guy” for daring to question the viability of a proposed miniature submarine in the rescue of Thai schoolchildren in a flooded cave.

Any system that allows Musk to continue to interact with his legions of followers and admirers, while also allowing him to apply the best practices of communication for a listed company CEO, could be applied across the market — if it can accommodate him, it can accommodate anyone.

Corporate communication is changing and as CEOs become celebrities in their own right, with their own direct channels to investors and customers, more will begin to be active on social media channels — blurring the line between official and unofficial corporate messaging.

The SEC, and other regulators, should think strategically about this issue and use these discussions with Musk — perhaps the worst offender of corporate Twitter abuse so far — to put in place a regime that can serve as a model for other CEOs and corporate executives.

  • By Sam Kerr
  • 09 Apr 2019

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 227,365.29 1021 8.28%
2 Citi 211,404.92 882 7.70%
3 Bank of America Merrill Lynch 176,375.36 735 6.42%
4 Barclays 164,503.56 674 5.99%
5 HSBC 136,422.24 745 4.97%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
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1 BNP Paribas 27,431.07 110 7.85%
2 Credit Agricole CIB 25,823.81 106 7.39%
3 JPMorgan 21,834.93 53 6.25%
4 Bank of America Merrill Lynch 21,382.31 54 6.12%
5 SG Corporate & Investment Banking 16,786.71 79 4.80%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
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1 Morgan Stanley 7,509.08 37 9.67%
2 JPMorgan 7,363.27 46 9.48%
3 Goldman Sachs 6,842.44 35 8.81%
4 Citi 5,763.97 41 7.42%
5 UBS 4,691.07 23 6.04%