Institutional investor lobby group Pensions Investment Research Consultants (Pirc) is decrying a lack of engagement from investment trusts.

We often report on Pirc recommendations in this section because of the useful insight they provide into the most pressing corporate governance concerns at the UK’s largest listed firms. Companies are calling for so-called ‘proxy agencies’ such as Pirc to show their recommendations before they are published - essentially giving them the opportunity to vet their advice.

This demand is winning support from regulators, including the European Securities and Markets Association (ESMA), while the industry group set up to respond on this issue, Best Practice Principles for Governance Research Providers, is in the process of drawing up relevant guidelines. Pirc says it already provides draft reports to companies for comment but says the response from investment trusts is poor.

Of the listed investment companies to which it sent draft reports between 16 December and 16 January it says 40% did not respond. Of the 60% which did reply, 35% did so simply to acknowledge receipt of the report without any feedback. It adds that its most significant governance concern on investment trusts is their ability to function independently of asset managers. In this context it notes 66% of the responses from externally managed trusts were received from the relevant asset management group.