Equity Finance 2025

Global Equity Finance Overview: Legal Frameworks, Market Trends and Innovative Financing Solutions

In today’s interconnected global economy, equity finance plays a crucial role in business growth, technological innovation and market expansion. This guide provides an in-depth exploration of the legal and regulatory framework for equity financing across jurisdictions that include Brazil, Hong Kong, India, Italy, Japan, Mexico, the Middle East, the Netherlands, the Philippines, Singapore, Sweden, Switzerland and Thailand, as well as the key market trends and developments in those jurisdictions. By bringing together perspectives from leading legal experts, it aims to offer a comprehensive overview of equity finance, covering early-stage and growth investments, public markets and IPOs, regulatory and tax issues, and the impact of bankruptcy and insolvency on shareholders.

The diversity of equity finance techniques and the role of regulation

The choice of equity financing, as opposed to debt financing, and the types of equity finance techniques and structures deployed will depend on a company’s stage of development and the specific needs of a given jurisdiction. Early-stage and venture capital financing provide essential support for young, innovative companies through common shares, convertible instruments, or hybrid options such as mezzanine financing. These structures cater to the high-risk, high-reward nature of venture investments, allowing investors to benefit from potential upside while managing risks.

Growth and private equity financing, on the other hand, introduce more sophisticated structures that reflect the changing risk profile and operational scale of maturing businesses. Private equity investors often use a mix of debt and equity, emphasising control mechanisms to protect their investments. This approach typically involves majority or significant minority stakes, balancing risk with the potential for substantial returns.

Public equity markets offer another important avenue for companies to raise capital. The decision to go public or stay private depends on factors such as access to broader capital, liquidity needs, and regulatory requirements. While some jurisdictions (eg, the USA) have highly active public equity markets, others ‒ particularly in emerging economies ‒ are still developing.

Stringent and, some would argue, overly burdensome regulation also makes accessing public equity too challenging for many. Although equity restructurings such as debt-to-equity swaps, down rounds and dilutive capital increases help companies manage financial distress, they similarly come with challenges related to shareholder rights and creditor consent.

Recognising the scale of this problem, in 2025, the Brazilian Securities Commission (CVM) introduced a landmark regulation: FÁCIL (“easy” in Portuguese). With effect from 2 January 2026, FÁCIL will provide a proportionate regulatory regime for “smaller issuers” (companies with annual revenues below BRL500 million that are listed and operating). It is designed to reduce costs and compliance burdens while maintaining investor protections. If it succeeds, it will lower Brazil’s structural barriers to market access, strengthen SME participation in capital markets, and consolidate the growing role of market-based financing, which has now overtaken the banking system as Brazil’s main source of corporate credit for the first time.

Opening the markets: how improving market access and ESG are reshaping equity finance

The equity finance landscape is shaped by the types of financing available and by the key players involved, including venture capitalists, private equity funds, institutional investors, and government bodies. These stakeholders have different risk appetites, investment horizons, and levels of involvement. In recent years, there has been a growing focus on hybrid financing models that combine debt and equity, providing greater flexibility.

Regulatory reforms to improve market access have been a priority for many jurisdictions. By way of example, Hong Kong has positioned itself as a “global superconnector” between Mainland China and international markets through initiatives such as Stock Connect, which marked its tenth anniversary in 2025, and the China Securities Regulatory Commission’s “Five Capital Market Co-Operation Measures”, which encourage leading Mainland enterprises to list in Hong Kong. Programmes like this facilitate cross-border investments and strengthen Hong Kong’s role as a major capital market hub.

Meanwhile, the effects of initiatives to improve access to equity capital have led in India to a so-called “reverse flip”. Indian start-ups that used to be held by offshore parents are redomiciling to India amid simplified FDI norms, lower corporate tax rates, deeper domestic markets, and strong growth. Public markets are enabling larger exits and raises. Since 2020, PE/VC-backed IPOs realised USD13.9 billion across 158 IPOs, led by financial services and e-commerce, and private credit is rapidly scaling to fill funding gaps in public markets.

ESG (with an emphasis on the E) considerations continue to play a significant role in equity financing. Some jurisdictions are integrating ESG principles into convertible bond issuances, offering new opportunities for investors focused on sustainability. The growing importance of ESG factors is reshaping equity finance, especially in public markets, where companies face both regulatory and investor pressure to demonstrate sustainable practices, while at the same time steering clear of allegations of “greenwashing”. The EU’s Gender Balance on Corporate Boards Directive, which will require large, listed companies to ensure that either 40% of non-executive director positions are held by the underrepresented sex or that 33% of all director positions (executive and non-executive) are by the underrepresented sex, has already had a significant impact on public markets across the EU.

From Dubai to Tokyo: IPO trends and follow-on offerings

IPO activity and follow-on offerings have varied significantly across jurisdictions, influenced by local economic conditions, regulatory environments and geopolitical factors.

The UAE has become a leader in IPO markets within the Gulf Cooperation Council (GCC) region, with both state-backed and private companies actively participating. Regulatory reforms have enabled dual listings, such as Americana’s dual listing on the Abu Dhabi Securities Exchange (ADX) and the Saudi Tadawul, thereby enhancing visibility and liquidity. But while IPOs and secondary offerings dominate, the market for equity-linked bonds – hybrid instruments combining debt and equity features – remains nascent. These securities, which include convertible and exchangeable bonds, offer issuers lower funding costs and investors downside protection with equity upside, making them increasingly relevant as interest rates rise.

Japan is witnessing the unwinding of long-standing cross-shareholdings: equity stakes held by listed companies in one another for strategic rather than investment, purposes. As a result, disposals of cross-held shares – through secondary offerings, block trades and tender offers for treasury stock – have reached record levels in FY2025. In an attempt to address IPO under-pricing linked to rigid filing timelines, Japan has also introduced the Form S-1 Securities Registration Statement. This allows earlier filing, demand surveys (to “test the water”) before listing approval, and reduced disclosure at the initial stage – shortening IPO preparation from about 30 to 21 days. The first S-1 IPO occurred in December 2024, though uptake remains limited due to added documentation and practical uncertainties.

In Switzerland, 33 companies have gone public since 2021, confirming the country’s continued appeal despite global uncertainty. Recent years have seen fewer but larger IPOs. Examples include Galderma’s listing, which raised around CHF2 billion and valued at between CHF12.5 billion and CHF14.5 billion, and Holcim’s CHF26 billion Amrize spin-off – alongside a surge in public takeovers, which jumped 465% to USD16.7 billion in 2025. Dual listings have also re-emerged following the lifting of EU-Swiss trading restrictions, with Holcim and SoftwareOne completing cross-border listings.

In Sweden, the market has long enabled equity raises through rights issues or directed share placements, and these have accelerated while IPOs have stalled. Between 2000 and 2024, Swedish companies carried out 3,416 secondary public offerings (SPOs), the second-highest count in Europe (behind only the UK) representing nearly a third of all EU SPOs by number. Relative to GDP, Swedish issuers raise more equity via SPOs than any peer market, reaching 1% of GDP annually, over twice the EU average.

Regulatory challenges and the outlook for equity finance

Equity capital markets face various challenges across jurisdictions, including regulatory hurdles, geopolitical uncertainty, and market volatility. In Mexico, political developments and currency depreciation have impacted investor confidence, leading to a decline in the number of listed companies. However, recent reforms and opportunities arising from global supply chain shifts and the rise of “nearshoring” offer a path forward for revitalising the market. In Japan, cross-border listings present unique challenges related to share certificates, tax considerations and foreign direct investment regulations ‒ as previously mentioned ‒ but the regulatory framework will likely evolve to accommodate these changes.

Looking ahead, equity capital markets are expected to continue evolving, with a focus on regulatory reform, market access and innovative financing methods. The increasing prominence of ESG considerations, the use of hybrid financing instruments, and the development of platforms tailored to SMEs are likely to drive growth. Understanding these variations is essential for investors and companies looking to navigate the complexities of equity finance and achieve their financial goals.

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The global equity finance landscape is dynamic, shaped by evolving investor preferences, regulatory frameworks and economic conditions. While the core principles of equity finance remain consistent, local legal, regulatory and market nuances create a complex environment that requires careful navigation. This guide aims to equip investors, companies and advisers with the insights needed to make informed decisions, seize opportunities and navigate the challenges of equity financing in an increasingly globalised economy.