CEO tells WP company is working diligently to address audit issue and remains proud of ETF offerings
Emerge Canada vowed to continue its mission to bring “diverse and sustainable solutions” to the ETF industry despite being hit with a cease trade order (CTO) by the Ontario Securities Commission.
The company, which was the first to bring strategies run by Cathie Wood’s ARK Investments to the Canadian market, is facing a major setback after the order halted trading of 11 of its ETFs, including its six ARK sub-advised strategies and its five recently launched EMPWR ETFs, which promote sustainable investing and are manage by women-led teams.
The OSC order stems from Emerge’s failure to file audited annual financial statements, fund performance reports and associated filings for the fiscal year ended December 31, 2022 by the prescribed March 31, 2023 deadline.
Lisa Langley, Emerge Canada’s CEO (pictured), told WP via email that on December 19, its relationship with its auditors, BDO LLP, ended. The decision was mutual, according to Langley. Since then, she said it has been in discussions with other auditing partners but that this delay meant it missed the filing deadline.
Langley said: “Once our audits are complete, we will file the required documents with the OSC to lift the CTO. We are working diligently to complete this. Investors can expect an update from Emerge regarding the appointment of an auditor and subsequent progress as we work towards resolving this outstanding matter.”
She added that Emerge, which operates in both Toronto and New York and, through Emerge Capital Management and Emerge Canada, manages around USD$600 million in assets, is working to communicate and maintain relationships with advisors during the CTO. “We greatly appreciate and empathize with all advisors during this time.”
With ARK Investment Management also partnering with BMO Investments in November, Emerge is now facing up to the challenge of restoring its reputation amid increased competition. Langley, however, pointed to its strong start and awards since she founded the company and remained defiant.
“We continue to pride ourselves on bringing diverse and sustainable solutions while advocating for diversity within the industry,” she said. “In doing so, we have received tremendous support from the industry. Our plan is to continue to build on that.”
List of Funds Impacted by the CTO:
EMERGE EMPWR SUSTAINABLE DIVIDEND EQUITY ETF
EMERGE EMPWR SUSTAINABLE EMERGING MARKETS EQUITY ETF
EMERGE EMPWR SUSTAINABLE GLOBAL CORE EQUITY ETF
EMERGE EMPWR SUSTAINABLE SELECT GROWTH EQUITY ETF
EMERGE EMPWR UNIFIED SUSTAINABLE EQUITY ETF
EMERGE ARK GLOBAL DISRUPTIVE INNOVATION ETF
EMERGE AI & BIG DATA ETF
EMERGE ARK AUTONOMOUS TECH & ROBOTICS ETF
EMERGE ARK FINTECH INNOVATION ETF
EMERGE ARK GENOMICS & BIOTECH ETF
EMERGE ARK SPACE EXPLORATION ETF
