Social media has become a key source of decision-making information for institutional investors that are now using it as a regular part of their work flow, according to research by market intelligence firm Greenwich Associates.
Eighty percent of institutional investors now regularly use social media within their work, according to a survey of 256 corporate and public pension funds, insurance companies, endowments and foundations worldwide. Thirty percent say social media has directly influenced an investment decision.
The survey also shows that almost half (48 percent) of institutional investors were prompted to carry out extra research on an industry or topic after seeing something on social media. Thirty-seven percent shared information from social media with decision makers at their firm while 34 percent said social media influenced a decision to work with a particular company or client.
‘These results show that social media is influencing decisions that can result in the allocation of billions of investment dollars around the world,’ says Dan Connell, head of market structure and technology at Greenwich Associates and author of the study. ‘With approximately 40 percent of the institutions globally expecting to increase their use of social media in the coming year, we’re projecting a further, rapid increase in social media on institutional investment markets.’
LinkedIn is the most popular outlet for work purposes, with a penetration rate of 52 percent among institutional investors. Four fifths of the investors that use LinkedIn do so at least once a week.
The survey also shows that investors in Asia use social media more than those in North America or Europe. YouTube and Facebook are the most popular social media with investors for personal use and are often used at work for group discussions and video distribution.
