The 1998 Reuters survey of Hong Kong and China companies -- the first such survey in this market -- was carried out by Tempest Consultants Ltd, management consultants to the securities industry.

A director at Tempest, Stephen Parker said the lack of transparency was worrying, particularly since the uncertainty created by the fall in Asian markets had created a need to build bridges.

``If a market is to be efficient, it has to be based on knowledge and information,'' he told a news conference.

But up to 50 per cent of the companies participating in the survey said they planned to reduce the time they allocated to fund management groups and to brokers.

They were particularly decreasing time with international fund managers and brokers.

``I think there are twoelements to this. I think first is where the market is. If there is bad news it may be that some people prefer not to talk about it,'' said Parker.

``And I think another thing is that, and this is based on the meetings that we have had with fund management groups, they were generally saying that they did not get enough access, or they got access but it was not necessarily with the right people.''

The survey of institutional investors and company finance directors also found that fund managers were seeking direct contact with companies, pointing to frustration with the quality of broker research provided on Hong Kong-listed companies.

Of the fund management groups participating, 49 per cent said they were using fewer broker teams and 46 per cent planned to increase their own in-house research resources.

``The fund management groups do say that a lot of broker research is really, really bad,'' said Parker.

``It is alarming that a number of brokers' heads of research confided that they also believethat the general level of broker research leaves a lot to be desired,'' Tempest said in the survey.

It identified 498 individual broker sector analysts who research the 350 largest Hong Kong-listed companies. Of the 498, only 253 received votes from fund managers.

The findings pointed to further consolidation in the brokerage industry. ``If you think markets are going to continue to be depressed, there must be more fallout,'' said Parker.

Marginal houses needed to cut costs to stay in business and risked going under if markets did not pick up, he said.

Fund management groups voted Credit Lyonnais the best provider of broker research and the top broker in terms of execution. Merrill Lynch's general sales team was ranked first by fund management groups.

Hong Kong-listed companies ranked Goldman Sachs first for its broker research and ranked it top in investment banking.

Fidelity Investments was voted the top fund management group by companies.

The survey was carried out over the last three monthswith the participation of 56 fund management groups representing US$32 billion of funds invested in Hong Kong equities and 144 companies representing 58 per cent of the combined market value of the 350 largest Hong Kong listed companies.