In Cooperation with:
Scoring Criteria
The criteria used in this study were chosen by the Economist Intelligence Unit’s research team in close consultation with LAVCA, and reflected LAVCA’s internal consultations with its members working in the industry. The real-world relevance of each of the criteria was initially evaluated through in-depth interviews conducted in late 2005. For this third Scorecard, the Economist Intelligence Unit conducted sixteen additional interviews in January and February 2008 with LAVCA members who are fund managers based in the LAC region and Spain (and in two cases government regulators). These aimed primarily to obtain more in-depth information on the nature and impact of regulations in the country or countries in which they operate.
Based on the views of these respondents and senior LAVCA staff, five of the criteria—tax treatment, minority shareholder rights, restrictions on institutional investors, capital market development and corporate governance requirements—once again this year received double weighting within the 100 point score to reflect their prominence in investment decisions made by PE/VC funds.
The EIU researchers gathered data for both the scorecard and investment flows from the following types of sources (see Appendices for a complete listing):
- Personal interviews
- EIU proprietary country rankings and reports
- Websites of government authorities and international organizations
- Websites of industry associations and funds
- Local and international news media reports
As in past years, information was more readily available for the larger and more developed countries in the region where there are more and varied market players. Also, data about PE/VC investments and investment conditions in LAC countries in general tended to be more fragmented than data available for the benchmark countries. This ongoing disparity of information in Latin America and the Caribbean reflects in part the nascent character of the PE/VC industry in much of the region, but constitutes a persistent obstacle to the industry’s further development.
Albeit imperfect, sufficient data were available to generate reliable qualitative scorings. Documentation of the scoring process, methodology and sourcing are provided in this workbook. In the following pages we make available further details about our scoring and provide graphic representations of the findings.