Here’s a rare intersection of something tangentially related to my job, and this blog. An IPO, or initial public offering, is when a privately owned company lists its shares on a stock exchange. It is a capital raising exercise: shareholders pay for part-ownership in the company, and will usually expect to receive a portion of the company’s future earnings in the form of dividends. Shares in the company will trade publicly on whatever stock exchange the company has listed on. The firm receives a cash injection from the shareholders when it lists, and can use this to expand, or for other capital-intensive projects.
China Tuna Industry Group, a tuna fishing company, attempted to list on the Hong Kong stock exchange last June. The firm targets bigeye and yellowfin tuna, which are IUCN redlisted as vulnerable and near threatened respectively. In its prospectus – a document meant to entice investors to sign up to purchase shares in the IPO – the company states that it can catch more tuna than quotas allow, because there is no enforcement of catch limits. As the excellent Guardian article on the IPO states (emphasis mine):
In a series of circular arguments, the document stated that China, which presides over the world’s largest long-distance fishing fleet, would not crack down on companies engaged in illegal fishing because it never had in the past; that the catch limits set by the Regional Fisheries Management Organizations apply only to China the country, not to actual Chinese fishing boats; and that even if the catch limits did apply, the regional fisheries organizations would not enforce them because “there is no sanction for non-compliance with Bigeye catch limits.”
The IPO was cancelled because of negative publicity, which escalated when Greenpeace got involved. The Chinese government and the investment bank handling the IPO (shame on them) were, respectively, amazed (sure) and silent on the subject.
Read the Guardian article here. It’s an revealing journey through the legal loopholes, apathy, and big money that characterise so much of what is wrong with global fisheries, and China’s in particular.
