The Standard Mark is awarded to a community shares offer that meets national standards of good practice. It has been developed by the Community Shares Unit, a government-funded body that promotes community shares. Unlike public share offers in companies, which are regulated by the Financial Conduct Authority, community shares are exempt from regulation. Investors have no right of complaint to the Financial Ombudsman and the money invested in community shares is not covered by the Financial Services Compensation Scheme.
The Community Shares Unit's Standard Mark scheme provides a quick and easy way for potential investors to check that the community share offer is genuine, and meets national standards of good practice. It ensures that:
• The offer document and application form are easy to understand
• Potential Shareholders are provided with all the facts you need to make
an informed decision
• The facts are supported by the business plan for the society
• Nothing in the documents is purposefully incorrect, confusing or misleading
It also gives any investor the right to complain to the Community Shares Unit, who will look into matters and decide how any problems should be addressed. (Because the Standard Mark is voluntary, their powers are limited, but the CSU will compare any queried share offer to good practice, and decide if the society needs to change what it is doing)
More information, including the Community Shares Unit's code of practice is available for download here.
