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Beneficial owners survey methodology
17 January 2014
Global Investor/ISF has made big changes to the methodology of its beneficial owners survey
Beneficial owners survey
Regular readers of our annual beneficial owners survey will
notice some substantial changes to this year's methodology and
presentation. The most substantial change is to the weighted
tables. This year the raw data tables replace the unweighted
They are identical - but with an easier to understand name - as
the methodology remains a simple average of the relevant scores
to that table.
The weighted tables were calculated using a three-stage
process, allowing for how important respondents considered each
service category to be, the size of the respondent's lendable
portfolio and differences in the generosity of respondents'
ratings in the three regions.
These tables have become our headline tables. We consider these
adjustments improve the relevance of the results - that is why
we made them. The other major change is to how the results are
presented. The regional and global scores of the agent lenders,
set out in alphabetical order, are positioned next to each
other so readers can compare internationally at a glance.
Likewise, the service category scores are positioned so readers
can identify the strengths and weaknesses quickly. The winning
score in each case is coloured red. Due to the efficiency of
presenting the results in this way, for the first time we have
room to present both the weighted and raw data service category
Beneficial owners are asked to rate the performance of
their securities lending providers. Respondents are asked to
rate their service providers across 12 service categories (see
below) from 1 (unacceptable) to 7 (excellent). There are two
methodologies - weighted and unweighted.
All valid responses for each lender are averaged to
populate unweighted tables. All beneficial owners' responses
are given an equal weight, regardless of the size of their
lendable portfolio. All categories are given equal weight
regardless of how important they are considered to be by
respondents. No allowances are made for regional
Step one - weighting for lendable portfolio: The
weighted table methodology makes allowances for both the size
of the respondent's lendable portfolio and how important the
respondents, on average, consider each category to be - these
were considered separately in the 2013 survey. An allowance is
also made for differences between average scores in each region
to make meaningful global averages.
Weightings are attached for the size of the respondent's
lendable portfolio. This means a greater weight is given to the
views of larger beneficial owners relative to smaller ones.
Weightings are generated according to the size of the
respondent's lendable portfolio. The boundaries are set, based
on data collected in the 2013 survey, so that there is an equal
amount of beneficial owners in each group (<$500m and
$500m-$2bn are given an equal weight of 0.6 as they contained
half as many responses each as the other bands in 2013 - the
information is collected separately only because it is useful
when analysing the data). The mean band of $5bn-$20bn is given
a weight of 1 - logically, an average client is given a neutral