Great References = Great Results


New York – When hiring new analysts, many financial services companies—as a matter of process—check references on promising job candidates. When hiring new research firms, however, most financial services companies do not check references. In fact, many do very little due diligence whatsoever, and instead choose to put faith in a firm’s marketing materials and sales pitch.

If checking references on individual analysts is an important mechanism for determining if a candidate is a good fit, then it stands to reason that checking references on prospective research firms is even more important. Hiring a research firm is like hiring a whole team of analysts—timeshared, of course, but just as critical to a money manager’s investment decision-making process. When taking on a new research firm, it is important to know that they have historically been able to deliver insightful research and/or high quality data. Talking to some client references is a great way to find out.

At Integrity, checking references is a central part of our process for evaluating research firms. When working with a client to find innovative new sources of research or data, we routinely ask prospective vendors to provide references for their work. We typically ask references to provide both qualitative insights on the strengths and weaknesses of the firm in question and quantitative ratings on specific metrics that are important for evaluating it (e.g. quality of analysis, turnaround time, etc.).
After years of checking references, we have built up a significant database of client reference data, which has helped us rate and rank research providers in a broad range of methodological categories. These rankings alone are hardly the basis for choosing a provider, but they can provide some guidance on which firms are widely respected by their users and which firms are not.


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