Sodali announces results of Institutional Investor Survey on Ownership Disclosure

Posted on: 12 April 2012

Institutional investors indicated ‘conservative support’ for a program that would give companies access to more detailed ownership information on the record date for a shareholder meeting, according to results of a survey released this week by Sodali, Ltd.

 

The Sodali survey – ‘Ownership Disclosure by Institutional Investors’ – was conducted during January and February. Sodali selected 90 institutional investors based on their portfolio size and cross-border investment activity. They were sent an electronic survey asking ten questions about ‘a proposed voluntary program’ that would share ‘systematically-generated ownership information’ with issuers.

 

22 investors responded, a return of nearly 25%. Andrea di Segni, Sodali’s Head of Operations, described the response rate and the level of interest in the survey as ‘encouraging’.

 

On the key questions, 41% of respondents said they would be willing to participate in the proposed ‘limited disclosure program’, while 32% said they would not participate, and 27% did not answer the question. Mr. di Segni described this as a ‘conservative level of support’, sufficient to justify a pilot program by Sodali during the 2012 annual meeting season.

 

Mr. di Segni noted that 77% of respondents have a formal policy that governs disclosure of their ownership positions, indicating widespread awareness of the issue and its importance. Even more importantly, he said that the question dealing with ‘concerns that make you reluctant to disclose ownership data to issuers’, revealed that by far the most significant obstacle cited by investors was ‘confidentiality of trading strategy’. Mr. di Segni said that this concern should not be a factor in the proposed program ‘because disclosure would occur only once a year on the annual meeting record date – not often enough to reveal trading patterns or investment strategies’.

 

Mr. di Segni indicated that he is in discussion with a few of Sodali’s corporate clients about participating in a pilot program. If the pilot is conducted, the names of the companies will not be publicly disclosed and the results will be shared on a confidential basis only with participants, regulators and professional groups working on improvements in cross-border share voting. 

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