As investors become more discriminating about which companies to prioritise, companies naturally ask whether they are likely to be on the radar screen. Clearly, this question should be answered on a case-by-case basis. However, the following rules of thumb have merit for European companies:
- Size: For companies of >€2bn market cap, there will typically be Europe-wide interest; for companies in a leading market index (e.g. FTSE100, CAC40) there will be interest from domestic investors
- Sectors: There is typically more investor interest in environmentally and socially sensitive sectors: Autos, Consumer, Oil & Gas, Utilities etc. There is less interest ‘screened sectors’: Aerospace, Tobacco etc.
- Product mix: Environmental technologies or socially-beneficial services are favoured
- Quality of social/environmental performance. Companies with well-structured sustainability strategies that are delivering results should shouting it from the rooftops; Companies with less advanced strategies should keep working internally – and keep key investors up to date in a low-key manner
- A company’s domicile. Investors in UK, France, Switzerland & Netherlands tend to be interested; (With some notable exceptions) investors in Spain, Italy and Germany are less interested
