Volatility rocks confidence index
VOLATILE financial markets have taken a further toll on shareholder confidence with the latest Melbourne Institute survey recording a 2.5 per cent drop in the three months to August.
The index shows shareholder confidence is now 9.4 per cent lower than a year ago, triggered by concern about the decline of the Chinese share market and weakness in local companies. But a lack of activism by major and institutional investors may also be a factor.
The GPS-Melbourne Institute Index of Shareholder Confidence measures expectations for price growth, price volatility and their future buying or selling intentions.
In August, the index measured 95.8, down 2.5 per cent since May.
For the first time, the August survey also asked shareholders if institutional investors should take a more active role to force change within companies and boards.
GPS director Andrew Thain said 57 per cent of shareholders wanted institutional investors to be more active for change and to also encourage and support other activist shareholders.
“Overwhelmingly, people want the big end of town to drive change, advocate for change and put their activist caps on when it comes to poor performances,’’ Mr Thain said.