Congratulations to GMI Ratings for winning top place for corporate governance research firms and Kimberly Gladman, Ric Marshall, and Sarah Wilson for top individual awards. Top ranking for SRI research goes to Sustainalytics.
RESEARCH OVERVIEW – to give readers a taste why they might want to download the full report.
The IRRI survey interviewed four groups with a stake in the SRI & Corporate Governance research value chains:
- Asset managers
- SRI & CG research providers
- Sell-side brokers
- Quoted companies
We asked about the nature and quality of products and services in the market, their relationships with each other and their expectations for how research and communications processes could improve in future.
We found that the SRI & CG research markets are complex and rapidly evolving but that they are doing so in a confident, well- supported and optimistic way.
We cannot pretend to summarise effectively our findings and this complex picture in one neat ‘Executive Summary’. Instead we reproduce the headlines from each insight area and encourage you to read in full those that most interest or surprise you.
SRI & CG research markets show strength, sustained interest and promise of more to come
Sell-side brokers believe the UK & France dominate demand for SRI & CG research
Industry thematics support integration; in- house action is limited
Materiality, mainstreaming & integration expectations
Competitive differentiation should drive ‘integrated analysis’ through the valuation process
The ‘most-integrated’ broker research is nominated
Analysts want direct contact with companies and integrated reporting
Director investor meetings are highly valued by companies, but too few are happening
SRI communications – companies are taking a well-balanced approach
No clear picture of responsibility for SRI communications
Energy and natural resource companies dominate investors’ meeting wish-lists
Please can I have an Apple … and an ArcelorMittal
Research process – status quo
Coverage is king; but financial focus and analyst access are ascending
Brokers use data, news & ad hoc services from research firms; they make less use of ratings for fully integrated research
SRI indices: Core, Could do better, Considering it & Cowards
Analysts, be transparent, do your homework, tailor your questions, ask them directly & engage deeply with the answers
Little time with companies; little time with clients; perhaps analysts should get out more?
IRRI Survey 2013
The most innovative research products and reports are nominated
Research process – economics
Brokerage communication & commission: 35% shining beacons; 20% lost in the mist; 45% on the murky middle ground
OTC research would drive up quality, diversify research supplier base and increase asset manager spend
Research process – future expectations
Trend towards data & in-house research – rather than ratings
Sell-side brokers to make more use of research firms
‘Bottom-up’ engagement is beating ‘top- down’
Feedback is listened to … usually