Investors expecting rise in direct engagement after Mifid II implementation

Issuers may be ‘taken by surprise’ by the increase of direct engagement, asking more of IR departments 

With the implementation of Mifid II just months away, new statistics suggest that issuers and investors may not be aligned on how much the regulatory change will transform corporate access.

Over three quarters (77 percent) of investors think that once Mifid II comes into effect on January 3, 2018, more meetings between institutions and issuers will be arranged directly, according to data provided by corporate access platform ingage. Just under half (47 percent) of the investors surveyed say they expect to rely much more on software to help manage the corporate access process themselves.

While 47 percent of corporates surveyed also expect to see an increase in direct engagement, Michael Hufton, managing director at ingage, says that many issuers could be ‘taken by surprise if the behavioral shift by investors does prove to be as big as institutions are suggesting’.

In an IR Magazine webinar earlier this year, Lyndsay Wright, director of IR at William Hill, said that she expects the demands on IROs will grow and that IR teams may need to make the case with their management teams for increased resources.

Another area the alternative corporate access platform looked at is feedback, which makes up part of the company’s offering. Over half of the issuers surveyed by ingage say they are currently unsatisfied with the traditional intermediated feedback system.

This echoes comments that IR Magazine has received in the past. ‘Feedback is one of the main reasons ultimately, why companies go out – they want to hear what their shareholders think,’ Hufton told IR Magazine back in 2015. 

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Abu Dhabi Investment Authority

Although Sovereign Wealth Funds could be considered to be, in theory, the perfect investor target for IR teams, there have been historical hurdles to engagement, including external/internal asset management strategies, scant public ownership disclosure and less visibility at the traditional investor meeting places.

To combat these and other historical barriers, a positive recent trend across several SWFs has included significant outreach and direct corporate access programs, which has led to growing awareness and visibility into the SWF community.

With this trend of increased engagement in mind, Ipreo collaborated with the investment team at the Abu Dhabi Investment Authority to provide issuers with a view into the institution’s investment strategy and recent moves to bring an increasing amount of capital under in-house active management.

Download the report here for clear and thorough insights into these strategies >>

About Ipreo

Ipreo provides market intelligence, data, and workflow solutions to all participants in the global capital markets, including sell-side banks, publicly traded companies, and buy-side institutions. Our extensive suite of IR services includes cross-asset class surveillance, investor targeting, perception studies, and custom analytics. Ipreo's BD Corporate platform offers the most comprehensive database covering global institutional contacts, profiles, and ownership data. Our critical insights and flexible solutions help our clients run more effective investor relations programs.

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