Several years after MiFID II drove sharp price deflation in research, pricing and budgets are finally showing signs of settling into a more sustainable middle ground. Many sell side research departments still struggle to turn a profit as standalone units, which has led to consolidation and reduced coverage – particularly in small and mid-caps.
Recent discussions in the UK and continental Europe about moving back to client-funded research via Commission Sharing Agreements (CSAs) are lifting expectations that a fresh influx of client funding could reflate research budgets, broaden coverage and spur innovation.
Against this backdrop, five themes are reshaping the European investment research landscape.
1. Regulatory reset and the slow transition back to joint payments
European asset managers are preparing for a measured shift back towards client-funded research via joint payments. After early skepticism, most now expect CSAs to become dominant over the next few years.
This marks a partial reversal of MiFID II’s unbundling and is driven by UK and EU rule changes that restore some flexibility in how research is paid for. The strategic goal is clear: make UK and European capital markets more competitive and narrow the gap with U.S. peers, who never had to unbundle research.
But this is evolution, not revolution. Buy side firms are moving cautiously. Few want to be the first movers in rebundling without industry consensus or clear client communication. Almost everyone agrees it is a matter of when, not if – but success will depend on:
- Transparent explanations to end-investors;
- Clear evidence of value for money.
2. Tech and AI: from buzzword to infrastructure
AI and advanced data tools are rapidly becoming part of the research infrastructure, although more behind the scenes than in the finished product. Both buy side and sell side largely agree: AI is there to augment, not replace human analysts.
Today, the main use cases are operational:
- Automating repetitive work (data collection, screening, initial drafting);
- Speeding up information retrieval and summarization;
- Supporting faster, more consistent coverage updates.
The payoff is more time for what clients value most: differentiated ideas, credible judgement and direct interaction with analysts.
A second, equally important theme is discoverability. In an environment of content overload, being found is half the battle. We see:
- Asset managers building internal research portals and AI-driven search to ingest broker and independent research;
- Banks experimenting with direct data feeds and APIs to integrate their research content into clients’ AI platforms;
- A shift from “publishing PDFs” to “feeding datasets and insights into client workflows”.
The more seamlessly research can flow into client systems – securely and with appropriate permissions – the greater its influence and the better the chances of being paid for.
3. Buy side needs: insight plus industrial-scale efficiency
For the buy side, fundamental research is as important as ever. Portfolio managers still want differentiated views and high-quality insights based on deep company knowledge and sector expertise. What has changed is the efficiency bar.
Asset managers are:
- Investing in in-house AI tools (often in partnership with tech and data providers) to sift through research and data at scale;
- Using third-party AI platforms that can respect IP protections yet allow customization on top of their own data and models;
- Integrating research and market data functions, reflecting the blurring line between data and research content.
The message to providers is clear: high-quality insight is non-negotiable, but it must be delivered in formats and through channels that fit increasingly automated and data-driven workflows.
4. Sell side talent: redefining the analyst of the future
Sell side research teams are under pressure to rethink not just what they produce, but who produces it and how. The product is changing – more bespoke work, more formats, more bite-sized and digital-first distribution – and so is the talent profile.
Tomorrow’s successful analysts and associates will need to be:
- Tech-enabled – comfortable with analytics, APIs and AI tools for modeling, screening and routine drafting;
- Client-centric – spending more time in conversations (engaging portfolio managers with insight and service) and less time manually wrangling data;
- Commercially aware – able to align research output with what drives broker votes and client wallet.
Most firms are allowing junior talent to use AI for efficiency, but are strict on how generative AI is applied to actual written research. Common elements include:
- Guardrails that ensure human authorship and accountability for key views and recommendations;
- Restrictions or full bans on using AI to draft core sections of reports;
- Review processes designed to protect originality, house style and compliance.
Over-reliance on AI is widely viewed as a threat to a firm’s edge and credibility.
Some forward-thinking brokers are pushing the operating model further. They are:
- Using AI to mine historical transcripts, monitor company data and automate routine updates;
- Outsourcing parts of fundamental work to specialized third parties;
- Freeing senior analysts to spend more time directly with clients – a high-value, hard-to-automate activity that also supports corporate access and broker votes.
5. Corporate access: the premium on face time
Corporate access – the arrangement of meetings between fund managers and company executives – is emerging as a red-hot topic in investment research. It is fiercely contested among brokers and often carries significant weight in broker votes.
Post-pandemic, conference calendars are full again and demand for quality C-suite face time significantly exceeds supply. Asset managers are willing to pay for access that is:
- Differentiated (exclusive 1:1s, carefully curated small group site visits);
- Convenient (management coming to the investor’s office or hosting focused virtual sessions);
- Relevant (aligned with portfolio holdings, watch lists and thematic priorities).
The sell side is responding with:
- Larger and more specialized conferences and roadshows;
- Technology such as smart badges, personalized conference apps and hybrid (virtual + in-person) formats to extend reach and gather better data.
Regulation, however, complicates the picture. Under MiFID II, corporate access in Europe could not simply be bundled with research and had to be treated as a separately priced service or “minor non-monetary benefit”. U.S. brokers, by contrast, can include corporate access within broader soft-dollar arrangements, which gives them more flexibility. This has led to active lobbying in Europe to allow corporate access to be more directly integrated into the research bundle.
Data and AI are set to play a bigger role here as well. The opportunity is to:
- Track which meetings lead to investment decisions or improved trading outcomes;
- Help issuers allocate scarce management time to the most relevant investors;
- Move towards true personalization: matching the right investor to the right company at the right time – likely achievable with better data on investor interests and past interactions.
At its core, though, corporate access remains a relationship business – one that is difficult to commoditize or automate.
In summary: a market ready for renewal
Europe’s investment research market is poised to enter a period of significant change as regulatory adjustments and competitive pressures force a rethink of research procurement and delivery.
Takeaways that stand out:
- Rebundling with accountability. The move back towards client-funded research through CSAs aims to restore coverage and depth, especially beyond large caps. Its success will depend on transparency, clear client consent and operational simplicity.
- AI as an enabler, not a replacement. AI will continue to reshape research workflows and distribution. The winners will be firms that treat it as leverage for their human talent – not a shortcut. Expect faster turnaround times, better discovery and more tailored content, not AI-only research.
- The enduring value of human relationships. The rise of corporate access underlines that investing is still a people business. No model can fully replicate the insight and conviction that come from meeting management teams, visiting assets or having a trusted analyst challenge your thesis.
Firms that can combine robust, transparent funding models; smart use of technology; and a strong human interface with clients are likely to be the ones that thrive in the next phase of European investment research.
