Hi gang,
For anyone who might be feeling slightly cynical about the very poor level of "research" that went into yesterday's Bloomberg article, here is an opinion piece (ironically from today's AFR) where they used FOI requests to find out who was really responsible for a Sydney Morning Herald piece late last year attacking short-sellers. The TL;DR is: the "research" came from University of Sydney Business School, and was sponsored by a PR firm who has ties to WiseTech, who had been recently targeted by the very short-sellers that the article was slamming.
It all goes to show how the media is used for gain. So bear that in mind when reading shoddy hit-jobs on any listed company. The last line of the article is brilliant!
Cheers,
mondy
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Sold short: USyd takes cash for comment
How much does it cost to launder your spin through the name of Australia’s most prestigious business school?The answer: far less than you might think.
For a paltry $7272.27 all-inclusive, the University of Sydney Business School will even chuck in a series of non-disclosure agreements. What a steal!In December, The Age and The Sydney Morning Herald ran front exposes of the world of “short and distort attacks”, whereby foreign analysts produce malicious allegations of companies committing accounting fraud, in cahoots with fund managers who profit off the ensuing fall in the share prices of the targets. In recent years the practice has “cost investors billions”.
That contention hung off an analysis by Sydney University Business School, provided utterly without caveats apart from citing some data from German-based researcher Breakout Point. But the university perplexingly refused to release the research to other journalists. And Breakout Point told us it was not a collaborator in the study and distanced itself from the findings.
Documents released under freedom of information laws show that even the university’s media relations team was unaware of the article, telling the business school they would “usually provide responses to every question” subsequently asked of it and “aim to be as transparent as possible” with journalists. These aspirations were quickly dumped.In mid-December, The Australian Financial Review reported that the university was refusing to name any “funding organisation” that sponsored the research and had said neither the academics nor the funding organisation engaged a public relations firm for the research.But two days after that, the Herald and Age quietly published online clarifications to the article to state that “the university study received a nominal sponsorship fee from corporate relations group Domestique”. Though “it was independently peer reviewed”.
Domestique is a top-tier PR firm that does work for some of Australia’s largest companies, including WiseTech, which is targeted by short sellers, and was quoted extensively in the Herald article.Sponsored research is a growing area for universities, rising from $338 million in 2008 to $522 million in 2018. You’d think prestigious (and publicly funded) Group of Eight institutions surely pursue such collaborations with the utmost probity, unlike the private researchers and consultancies who can always be assured of finding precisely what their sponsors want them to. But hey: even the consultants will usually release their findings (and funders) publicly.The “research project agreement” struck between the university and Domestique reveals the project’s title: “Short & Distort Attacks on ASX companies by foreign-based research activists”. It’s hardly suggestive of an independent, open-minded inquiry into the topic.Non-disclosure agreements revealed through FOI covered “proprietary or confidential ... information or data” supplied to the university by Domestique, of which “the unauthorised use, duplication or disclosure ... would result in significant harm to [Domestique Consulting]“. Which is a total crock. The data provided was nothing more than share prices, trading volumes and short interest in 50 companies, taken from “public sources including the ASX and ASIC” and “proprietary databases such as Eikon (Refinitiv) and Bloomberg”.Domestique also provided short reports, which are usually publicly released by their issuers anyway.This was all fun and games until the Australian Securities and Investments Commission asked for the research. The university “presented the key findings in their report to ASIC in confidence on the 15 of January 2021”.
The alleged short-selling villains are less than impressed.J Capital Research’s Tim Murray said sponsors of university research should be disclosed, otherwise regulators would be “lobbied by academics as a front for corporates”. GMT Research’s Gillem Tulloch said Domestique used the university’s “reputation to publicly promote impartial research and then hid behind the cloak of an non-disclosure agreement”.
And Bucephalus Research’s Rob Medd said “it is amusing that people that complain about short sellers’ ethics are so quick to show that they have the morals of alley-cats”.
(20min delay)