Given their time and resource constraints, companies have to learn how to prioritise between the various investor organisations that demand their attention. This requires them to choose between:
- different types of organisation
- different organisations of the same type.
Companies receive questions from four sources:
- ‘buy-side’ (asset manager) analysts and portfolio managers
- ‘sell-side’ analysts
- SRI agency analysts
- investor coalitions
‘Buy-side’ asset managers
Asset manager questions should be given highest priority as these are usually sent with a view to adding a company to a ‘buy list’ or to verifying its continued position on that list.
Companies should naturally prioritise asset managers:
- that are large holders of their shares or,
- that hold their shares within specialist SRI funds or,
- that are significant players in the company's domestic or target markets or,
- that are high-profile SRI managers that do not yet hold the company’s shares
‘Sell-side’ broker analysts
‘Sell-side’ analysts very rarely ask general questions. Almost all of the questions they ask are directed towards specific research pieces that will be published and actively marketed to a global audience of SRI and mainstream investors. This focus means that questions from them are usually worth answering.
At this stage, there is little to distinguish the reach of different sell-side brokers, so companies should prioritise those that are actively writing research on them and on the themes that affect them
SRI agencies
Ratings agency questions should be prioritised according to:
- the number of relevant clients that the agency in question represents
- the volume of screened assets that they supply research for
- their influence (if any) on any publicly-disclosed SRI indices.
Investor coalitions
Investor coalition questions should be vetted according to the same screening processes that apply to ratings agencies - relevant asset manager clients, volume of assets etc.
Companies should also try to gauge how active the asset manager buy-in to the coalition is. It is eay to sign a letter asking somebody else to do something.
