Value reporting

Checklist of criteria for value reporting

University of Zurich

Institute for Banking and Finance (IBF)

Prof. Dr. Alexander Wagner, PhD
Mirko Reichlin, BA UZH
Ermir Binakaj
Copyright by Institute for Banking and Finance,
University of Zurich

The original version of the investor relations rating emerged during the course of a dissertation project coordinated by Dr. Peter Labhart under Prof. Dr. Rudolf Volkart.

Introductory remarks

The criteria described below are designed to be a definitive list. The examples, however, are not intended to be definitive. In other words, the evaluator has scope for discretion when it comes to identifying analogies and incorporating them into the evaluation. Evaluated are explicitly encourages to exploit this scope. This is to ensure the evaluation is as balanced as possible and applicable across industries. One of the ways the Department of Banking and Finance has endeavoured to ensure the quality of the evaluation is by selecting well-trained jurors (students on business and economics degree courses at the University of Zurich). In the following, this document often refers to "products". In addition to physical products, this term is also used to refer to abstract financial and insurance products and services.

Scoring

The rating consists of scores of 1 to 6 as follows:

Score

Remark

6

Exists, contains very good information

5

Exists, contains good information

4

Exists, contains usable information

3

Exists, information usable, but only just

2

Exists only indirectly, contains very little information

1

Does not exist, contains no information

Weighting

The various sets of criteria were weighted as follows:

Set of criteria

Weighting (%)

Weighting of
final rating list (%)

1

General impression

5

80

2

Background information

20

3

Important non-financials

20

4

Trend analysis

5

5

Information on risks

10

6

Value-based remuneration policy

10

7

Management discussion and analysis of actual results

10

8

Target data and credibility

10

9

Sustainability

10

 

Total

100

10

Internet investor relations

Separate rating

20

The (weighted) score for a particular set of criteria is calculated by multiplying the average score by the weighting factor. An example for criterion set 1, "General impression": score for criterion set 1.1/1.2: 4/6. P. Average score for criteria set 1: (4+6)/2 = 5. Number of points achieved for criteria set 1 (weighting factor: 5%): 5 × 0.05 = 0.25). For the final rating, the criteria 1-9 above account for 80%.

The "Internet investor relations" criteria are rated separately. Here the responses "Exists" or "Does not exist" are allotted a score of 1 and 0 respectively, and this score is incorporated into the evaluation. The sub-criteria sets 10.0 to 10.9 from the "Internet investor relations" sub-section each have an equal weighting of 10%. The "Internet investor relations" criteria set makes up 20% of the final ranking.

Scoring

Certain criteria are intended specifically for listed companies, for example "4.4 Total shareholder return". As only listed companies are able to fulfil the corresponding criteria, these criteria as skipped for the rating in the case of unlisted companies, and are not taken into account when determining the overall score. As a consequence, unlisted companies are not disadvantaged. Corresponding criteria are marked with an asterisk.

Terms such as "investor" or "investor relations" are applied rather more broadly within the context of this catalogue of criteria (in particular in the criteria set "Investor relations on the Internet"). This means that in the case of unlisted companies in particular, such terms may also refer to other groups (e.g. taxpayers, cooperative members, etc.).


Catalogue of criteria with explanatory notes (PDF)