Every year, the Office for National Statistics drills down into the share registers of dozens of listed British companies, large and small. The aim is to use the sample to hazard an informed guess at the beneficial owners of the £1.48trn worth of quoted shares - in other words, to answer the question: Who actually owns Britain?
The answer is: "Certainly not individual Britons". Private investors have been dwindling in importance for at least 50 years and probably a hundred. When official measures began in 1963, individuals in the UK owned 54 per cent of all London-listed shares. The latest report shows they own just 14 per cent.
Curiously, the decline of the private investor carried on throughout the Thatcher and Major years, despite these leaders' passion for a share-owning democracy. The Conservatives privatised large chunks of the economy, often selling them at bargain prices. Yet the millions who responded to the "Tell Sid" and other campaigns were not enough to stem the tide.
According to the ONS, in 1981, just as the privatisation programme was about to get going in earnest, private investors owned 28 per cent of London-listed shares. By 1992 that figure was down to 20 per cent and by the time Labour came to power in 1997 it had fallen to 17 per cent. Nor have the vast demutualisations of building societies and insurers done anything more than slow the trend.
The days are long gone when dog-eared share certificates of companies that were once household names - Distillers, Courtauld, Dunlop, Hawker Siddeley, Swan Hunter and Vickers - were stuffed in the drawers of a million middle-class bureaux. So are all those company names. Today people are still just as financially exposed to the stock market - but indirectly, through pension funds, insurance company endowments and pooled investment vehicles such as unit trusts and investment trusts.
Yet even these four categories of owner don't explain the full picture. Pension funds played a dominant role, their share of all London-listed shares rising from 6 per cent in 1963 to a peak of 32 per cent in 1992. But the ageing population and regulatory issues have - rightly or wrongly - persuaded pension funds either to reduce their bet on shares in favour of
safer bonds or to diversify overseas. Their share of the total UK equity market has shrunk back to just 16 per cent.
It's a similar story with insurance companies, solvency rules forcing them to sell out of equities at a moment that is far from ideal. Their share of the stock market, which peaked at 24 per cent in 1997, is down to 17 per cent. Unit trusts and investment trusts are also well past their heyday. In the mid-1990s, they accounted for more than 9 per cent of listed companies. Today it's 5 per cent - a still considerable £76bn, mind you.
So who has taken up the slack? Foreigners. Overseas investors accounted for just 7 per cent of British shares in 1963. They now own a record 33 per cent, or £483bn worth of UK plc. On average, a third of every company is in foreign hands.
This trend is due partly to the internationalisation of the stock market. When South African brewers or Aussie miners or Russian retailers choose to make London their main listing, they inevitably bring many of their own domestic shareholders with them. Cross-border mergers also enrich the mix. But the main engine for the trend is the search for diversification. Investors around the world want to spread their bets. When investors in every country want a little piece of Britain in their portfolio, it adds up to a very large chunk in aggregate. The obverse is that the British public has invested heavily in American, European and Asian shares.
Has this got further to go? Much further. It seems likely that only a period of serious international tension or a prolonged era of economic underperformance (and not just a single recession) will persuade foreign investors to sound the retreat.
Does it matter? Yes. Companies need to be answerable to elected governments, domestic regulators and public opinion. The more geographically dispersed their shareholders, the less pressure is brought to bear.
Another category of investor in the survey is growing. The "other financial institutions" category used to account for less than 1 per cent of the total share market. In the past ten years it has mushroomed. The reason is hedge funds - unregulated, versatile, opportunistic beasts which roam the world's markets in search of profit. Their influence is likely to carry on rising because of the volume of money being handed over. They are accountable to no one but their anonymous, well-heeled clients. And with
that, the very idea that Britain's blue-chip firms are answerable to a handful of nicely UK-based organisations such as the Pru or Legal & General is fading rapidly.
Patrick Hosking is investment editor of the Times