ISP Research 25 Years – Why Is Research on Institutional Investment Important?
This year, we will carry out our traditional Institutional Investment Services Programme for the 25th consecutive time. In this blog post, we explain the significance of the study and shed light on its history. In addition, Iiro Nikander, who is responsible for research development, explains why research on institutional investment is important in 2024. This post is part of a blog series in which we present our study from different perspectives.
SFR Research is an independent research company founded in 1990 and we offer high-quality institutional investment and capital market research for the benefit of the entire wealth management and investor community. Our esteemed research is based on long-term trust and cooperation with the investors we interview. Explore all our studies here!
What is the Institutional Investment Services study?
Our Institutional Investment Services Programme, more commonly known as the ISP survey, is an extensive in-depth interview survey conducted regularly since 2000, in which approximately 100 of the most significant community investors in Finland participate annually. The respondents' combined investment assets amount to nearly EUR 300 billion.
The research population includes a wide range of investors, such as pension funds, insurance companies, universities, cities and foundations. The response rate of our survey is very high annually, over 90%, which highlights its importance in the Finnish institutional investment industry and at the same time guarantees the reliability and comparability of research results.
In the study, we examine investor allocation solutions, the use of investment assets and views on future trends, from which we compile a comprehensive market report for investors and service providers. In addition, we investigate investors' experiences of the results and quality of the work of different service providers and the reasons behind choosing an asset manager. From this information, we compile a competitive positioning report, which provides valuable information on market dynamics to service providers and at the same time serves as a useful information and feedback tool for investors.
About the history of ISP and SFR
Scandinavian Financial Research (SFR) was founded in 1990 on the initiative of Professor Ingo Walter to analyse the Nordic corporate banking market, and in the early days of the company, research focused specifically on the in-depth examination of the corporate banking market. In 1996, we launched the first version of the Institutional Investment Services Program, focusing on customer experience research. To this end, we interviewed carefully selected institutional investors in Finland.
Since 2000, we have conducted the survey annually, and as a result, the formats and contents of the reports have become more precise. From the very beginning, we have produced a competitive positioning report on different service providers and collected information on investment trends for the market report. Since 2006, we have also published a separate report focusing on alternative investments.
In response to the growing needs of investors, in 2024 we launched a separate in-depth study on alternative investing focused on private equity funds, which you can read more about here. The study is the first of its kind in Finland based on the quality of service of private equity fund managers and utilizing peer reviews of investors.
In 2021, there were changes in SFR's ownership base when SijoittajaPRO Finland Oy, now SFR Advisors, acquired a majority holding in the company. As a result of the acquisition, the business operations of both companies have developed further, which has enabled the provision of even higher quality services to both asset managers and investors. During its history, SFR has also been active in the other Nordic countries, and studying the northern economic area will be even more important for us in the future.
Who is the Institutional Investment Services study for?
Our research serves investment service providers both in Finland and abroad. Our customers utilise the research to develop their product portfolio, improve the quality of customer service and develop customer-responsible operations, among other things. Our reports provide impartial information on the market, enabling comparisons of one's own actions with competitors. The survey provides asset managers and other service providers with unique information to develop their operations, which will enable them to serve their institutional clients even better.
Most of our clients have been with us for a long time. An in-depth analysis of one's own business that utilises independent research data has become an annual review, which helps to develop one's own operations in an increasingly competitive field. Investor demands have changed over the years, which has also affected asset managers' performance. When service providers actively listen to investors, it strengthens their competitiveness and thus improves the services of the entire investor community.
All interviews are conducted as personal in-depth interviews, during which we get to delve deeper into the activities of investors. The investors participating in the study remain largely the same year after year, which improves the comparability of the results and shows that they also feel that the study is important. According to several interviewees, SFR acts as an effective feedback channel between service providers and customers, promoting a better customer experience and quality of service. In addition, the survey offers the interviewee the opportunity to compare their own actions with the solutions of other investors, thus bringing added value to their own work.
Why is it important to study institutional investing in 2024?
Iiro Nikander is responsible for planning and implementing studies at SFR Research together with the rest of our research analytics team. He describes the importance of research in 2024 as follows:
"In recent years, we have faced a number of significant geopolitical changes that have increased pressure on investors and asset managers alike to leverage high-quality data amid uncertain markets. In these circumstances, our research serves as an excellent support for decision-making.
On the other hand, there is no point in overemphasizing the exceptional nature of each moment we experience. One of the most significant strengths of ISP research is its annual implementation, which has enabled a unique 25-year monitoring history of investor behaviour. This long-term data provides an in-depth analysis of past trends and also serves as a key to understanding future markets. In this respect, our research is unique in Finland. However, these changes bring with them new requirements, which we respond to by constantly listening to the investors and subscribers we interview."
How is this year’s study better than ever before?
Iiro explains how our 25-year development has crystallized in the new system we introduced this year, which enables us to have strong analysis tools to produce higher quality reports for the entire asset management community. New analysis tools will help us better meet the challenges of the ever-evolving asset management market, for example by improving our ability to analyse historical data. We are excited about the opportunities we can offer investors and service providers as we head into the future.
In addition, Iiro reveals how the ISP 25th anniversary celebration at the end of November will be a unique opportunity in the Finnish institutional investment scene. Interesting panel discussions are expected related to, for example, the Finnish stock market and the situation in international geopolitics. Invitations to the event will be sent in October, so you should definitely stay tuned!