There are many individual roles that comprise an investment bank's operations, and a corporate finance associate is one of those positions. The individual who fulfills this role works on major deals in the capital markets, such as initial public offerings (IPOs) in the equity markets or bond offerings in the debt markets, alongside more senior personnel. Corporate finance associates participate in the deal-making process and might be involved in performing the due diligence and research tasks leading up to a transaction. They are not mere bystanders while decisions are being made by senior investment bankers.
Industry professionals in corporate finance associate jobs typically are hired by investment banks, including large institutional firms and independent boutique banks that might focus on smaller deals. Throughout a career, an associate can advance and take on increased responsibility along the way. The process can help a young associate identify his or her strengths and interests as they relate to corporate finance. This might be an entry-level position, and this person might participate in broad industry coverage of deals, especially if he or she is employed at a large financial institution. Upon achieving some level of success in this role, an individual might advance to participate in deals that involve a particular industry, such as energy or healthcare, that offers an opportunity to gain expertise in a specific niche for further career growth.
Even though a senior banker leads the transaction processes with clients, a corporate finance associate also plays an integral role. The associate is expected to create and maintain client relationships that could continue for an entire career. Industry connections are a vital part of investment banking, and the relationship-building process begins in earnest for a corporate finance associate.
The specific tasks of the associate could include writing proposals for merger-and-acquisition activity for a potential takeover candidate. This professional might participate in negotiating terms for a merger, such as the value of a deal or the way that the transaction will be financed using debt and equity, for instance. A corporate finance associate might be involved in deals involving the issuance of both debt and equity in the capital markets and might begin to focus on one of those segments. On the equity side, an associate might contribute to a client's desire to raise money by selling stock in an IPO, and on the debt side, this professional might construct sophisticated bond offerings for clients who expose investors to varying degrees of risk.