Call for evidence on Treasury’s investment research review

Treasury has invited written evidence as part of its review of the UK’s research and investment landscape, as promised by the Edinburgh reforms.

The review aims to examine the link between levels of research and the attractiveness of the UK as a destination for companies to access capital, in both the private and public markets. Ultimately, it intends to provide recommendations on improving the UK’s research landscape with the aim of making the UK a more attractive listing location.

Treasury set out the following non-exhaustive list of questions on which views are sought:

1. How does investment research provision in the UK compare, or how is it perceived to compare, with other major international financial services centres?
2. What is your assessment of the amount, quality and type of investment research currently provided on companies that are listed or quoted, or seeking to be listed or quoted, on the UK public markets?
3. How important is investment research to the attractiveness of the UK public markets to listed companies (or companies considering listing) and their investors or to companies looking to access capital in private markets? – Is there a specific link between research and valuations for listed companies or those seeking to list?
4. Are there specific issues relevant to UK investment research on technology and life sciences companies that should be addressed, including compared to other jurisdictions?
5. Are there specific issues relevant to UK investment research on smaller UK listed or quoted companies that should be addressed?
6. What demand do investors have for research on UK listed and quoted companies, what are the factors driving this demand, and is the amount, quality and type of investment research currently provided sufficient to meet this demand?
7. What impact does the current UK legislative and regulatory environment have on the provision and quality of research, including (but not limited to) the MiFID II unbundling rules? Please provide references to relevant legislative/regulatory provisions with your answer where relevant.
8. Have the UK 2022 revisions to the MiFID unbundling rules applicable to smaller quoted companies helped to facilitate investment research in relation to those companies?
9. What might be the impact of any changes on the proposed UK legislative and regulatory environment on the provision and quality of research, the management of conflicts and payment for the provision of research?
10. Are there impediments (actual or perceived) to dialogue between UK listed or quoted companies and investment analysts that impinge the quality of research that should be considered and addressed?
11. Are there other impediments (actual or perceived) on the provision of research to investors – whether institutional or private – that should be considered and addressed?
12. What steps (legislative and non-legislative) could be taken to improve the provision and quality of research on UK listed and quoted companies?

The call for evidence closes 24 April 2023. The wider review will run until June 2023.