Shareholder perks

Attractive Perks for UK Shareholders

Over the years Hargreaves Lansdown has been appointed as the lead retail broker in many new public share offerings. Many companies ask whether they should offer some type of perk to their shareholders. The good companies understand that it is the shareholders who should come first in any deliberation about future policy of the business. Having shareholders who use the company’s products or services at a discount or with some incentive focuses the minds of management that their owners, i.e. the shareholders, are sampling their wares and the service they provide. This is prima facie evidence that those companies really are trying to add shareholder value.

Private investors buy shares in UK companies for two potential returns: the dividends and hopefully capital growth as share prices rise. It is very rare to find three potential rewards for holding one investment, but anyone who enjoys the product or service of a company in which they own shares has in effect another dividend if those services are provided more economically to shareholders.

An example is Laura Ashley, which not only offers shareholders a 20% discount voucher, but anyone who has invested will also have seen a very good return over five years. £1,000 invested in July 2003 would have been worth £3,018.17 by July 2008 – a return of 202%. (Past performance should not be seen as an indication of future performance. Lipper offer to bid income reinvested 01/07/03 : 01/07/08).

Whilst we do not believe you should buy a share purely for the perk, the addition of the perk makes owning the share more desirable.

We have included the name and telephone number of the Registrars with each entry so you can check that the perks have not changed before investing.

The information contained is believed to be correct as of June 2008. However, the companies concerned reserve their right to change their rules and regulations regarding shareholders, or withdraw any concessions at any time. There is normally a period of time before new shareholders become eligible for concessions.

View our list of shareholder perks

Peter K Hargreaves
Chief Executive
Hargreaves Lansdown PLC