Corporate transparency, trust, and access to top executives are more important than ever when it comes to making investment decisions in the Asia Pacific (Apac) region, according to research by Institutional Investor.
The magazine’s just-released 2016 All-Asia Executive Team survey canvassed opinion from 1,394 investment professionals at 582 financial institutions. Respondents from the buy side work at firms that collectively manage an estimated US$963bn in Asia ex-Japan equities.
Three magazine reports that three key trends emerged from this year’s survey:
• China’s state owned enterprises (SOEs) are communicating more with investors than ever before, including those outside of Asia. The SOEs are taking disclosure more seriously as well, reflecting the country’s increased focus on outbound investment and recognition of the increasing importance of perception and credibility in today’s global investment environment.
• Buyside participation in the polling surged 24% year-on-year (YoY) from 2015 to 2016, while hedge funds participation in the polling of the investor relations work of Asian companies is up three percentage points over last year to 29%. The growth in smaller asset manager participation (less than 2.5bn) from 74% to 78% is another significant development since the executive team polling does not weight assets under management in the voting.
• Banks in India are seeing their chief executive officers (CEOs), investor relations officers (IROs) and chief financial officers (CFOs) emerging as some of the top ranked in the region, reflecting greater transparency and accountability at the top, as well as a commitment to increasing shareholder value.
“With continued questions over the global economic outlook post both China slow down fears and Brexit, now is the time for companies to effectively engage investors and stakeholders around the world to tell their story and secure investment dollars,” said Will Rowlands-Rees, managing director of research at Institutional Investor.
Among other key trend evident in this year’s results is the way leading CEOs are using technology to bolster their presence in underserved segments of Asian markets.
The magazine reports that four companies swept their sectors in this year’s poll, capturing first place in every category in which they are eligible to compete. Three of the four were Hong Kong-based, reflecting the continuing significance of Hong Kong as a financial hub:
• China State Construction International Holdings, an engineering and construction outfit headquartered in Hong Kong.
• Kerry Logistics Network, a Hong Kong-based provider of freight services and warehouse operations, topped the transportation roster.
• MGM China Holdings, a casino, hotel and resort operator in Macau, outperformed its peers in gaming and lodging.
• Taiwan Semiconductor Manufacturing Corp., the world’s largest semiconductor foundry, leads the line-up in technology/semiconductors.
A study of the leadership pipeline at the UK’s FTSE 100 corporates shows modest progress, but many top companies still have no ethnic minority presence.
The world’s second-biggest economy will grow faster than previously predicted over the next four years, but the rate is unsustainable unless China addresses the problem says the International Monetary Fund.
The insurance industry will also benefit as private businesses increasingly bypass the public internet and communicate with one another direct, predicts Equinix.
The information and communications technology sector is suffering a triple whammy from slower growth, thin profit margins and fierce competition, claims Atradius.