New Research Shows that Majority of Retail Investors Feel Undervalued

Research by Yonder Consulting released today, showed that a majority of UK retail investors feel undervalued by the companies in which they invest, with shareholders aged 35 years and above statistically being the most likely to feel overlooked.

Results of a recent survey commissioned by The Engagement Appeal (‘TEA’) – a platform for inclusive investor reations – indicate that 52% of shareholders who participated feel the companies to which they have committed capital do not sufficiently engage with them in terms of ease of access to information and levels of communication.

This percentage rises to 59% for those investors over 35 years old who are likely to have contributed significant equity to improve their personal wealth, or perhaps to secure their financial future for them and their families. Such objectives are typically pursued via a traditional investment strategy, in the hopes of increasing their pension pots, retirement plans and various funds for children once they reach adulthood. As such, these investors are all the more expecting communication and greater reassurance from companies that their capital is safe.

This is further evidenced by greater utilisation of wealth managers by older generations, who are governed by strict mandates to protect their clients’ best financial interests. In contrast, Millennials and Gen Z- investors are typically more tech-savvy, and more likely to primarily invest via mobile apps which lack this level of protection.

The survey affirms findings made by TEA independently and its belief that much more needs to be done to ensure retail investors have their voice heard. Over the past 20 years, TEA has noted that there has been a genuine democratisation of buying and selling shares. However, this trend has not resulted in or led to any meaningful improvement on the engagement side.

Lord Lee of Trafford, an active private investor and the UK’s first ISA millionaire, said: “We currently live in an era of rapid and ever-increasing digitisation. The traditional model, by which retail shareholders are updated via written communications and physical AGMs, is no longer sustainable. It is important that we adopt a hybrid model of dialogue allowing equitable access for all stakeholders with the companies in which they invest. So, whilst I believe there should still be the option of a physically attended AGM, remote access should also be made available.”

Sheryl Cuisia, co-founder and director of The Engagement Appeal said: “The Engagement Appeal believes that all investors should have equal voice in how their investments are managed. We are committed to driving real change by developing solutions that meet the needs of companies and shareholders alike, allowing all stakeholders to benefit from corporate decision making.”

Sheryl and Lord Lee will both be speaking at the Quoted Companies Alliance (QCA) Annual Conference 2023 “Energising Public Markets”, on Thursday 8^th June. This will be followed by an ‘Afternoon TEA’ talk on inclusive investor relations and capital markets, which will take place in the City. For more information, please visit the TEA website https://teaxall.org/.