Did You Know...

...that according to the buy-side, investor relations can have as much as a 25% impact on a company’s valuation? In our most recent study of the buy-side, we uncovered that portfolio managers and buy-side analysts attribute a premium of 10% of a company’s valuation to good investor communications and a discount of 15% to bad investor communications.

Global Buy-side Attitudes Regarding Superstar CEOs

With the passing of Steve Jobs we got to thinking of his legacy on the buy-side, where he ranks among his best known business peers and, more generally, how investors approach companies that are headed by what some may call “superstar” CEOs. So in the latter half of October we completed 104 telephone interviews on this topic among buy-side investment professionals around the world – North America, Europe and Asia-Pacific. The results are interesting:

Even though the global buy-side recognizes that “superstar” CEOs generally receive more credit than they deserve for the success of their company, a sizable proportion (2 in 5 or more) say they frequently (12%) or sometimes (29%) invest in companies purely on the reputation and prestige of a CEO.

Which US CEOs are most highly respected by the global buy-side? Warren Buffett on the basis of his overall influence over the last 25 years and, perhaps not surprisingly given his recent death and subsequent media coverage, Steve Jobs as the most visionary.