Aviva Investors calls for overhaul of 'biased' sell-side research

Urges regulators to take action

Aviva Investors has proposed reforms of sell-side research practices, which it said were failing investors by being "overly positive, sometimes biased, and preoccupied with short-term financial metrics".

The firm said poor sell-side research "contributes to a misallocation of capital and potentially rewards poor corporate practices" and that "many sell-side analysts do not apply enough scrutiny to businesses, management projections and risks". Study: Just 6% of asset managers are ready to meet MiFID II best execution requirements A survey of 342 sell-side analysts conducted by Aviva Investors found that 42% of respondents believe sell-side research has a detrimental short-term focus, failing to consider material non-financial drivers of company performance, such as ESG factors. Som...