Recently, the responsibilities of the investor relations officer, or IRO, have grown immensely. On top of the regulatory and financial knowledge required for earnings and financial modeling, IROs are also required to have a breadth of soft skills. As the demands of investor relations on a company grow, so too will the role of the IRO. The future of the role will be subject to regulatory, communication, and human resource challenges.
Legal, Regulatory and Technological Changes
While it’s impossible to predict exactly how regulatory changes will affect IROs, change is inevitable. In the last 20 years, there have been two major regulatory events (Sabarnes Oxley 2002, and MIFID II 2018) that have permanently impacted investor relations, as well as several significant stock market crashes. There’s no telling what the future holds, therefore an IRO must be adaptable to a constantly changing environment.
IROs can be supported in a changing environment through networking, training, and technology.
Professional associations such as NIRI and CIRI can provide an excellent starting point for IROs to share best practices and disseminate information. Additionally, industry specific bodies such as the Mining Association of Canada or the BioPharma Networking Group, among others, can help IROs navigate challenges that are related to certain industries.
Investing in IROs within your organization is also a good way to ensure your IROs are able to do their best work. Investing in courses and certifications will not only help IROs perform in a fluid industry, but it can also payback in the long run as an incentive for IROs to stay with your organization and grow into more senior roles.
Lastly, technology is an IROs best friend when it comes to keeping up with rapidly evolving markets. Powerful investor relations software can help IROs bridge the gap between the best practices of yesterday and tomorrow. Irwin’s software supports IROs with the latest and greatest advancements in investor targeting, shareholder monitoring, research and estimates, and more. A strong tech stack can help IROs automate busywork so they can focus on making strategic and impactful contributions to their organization.
High-Touch Communication Trends From Analysts and Retail Investors
One of the biggest driving factors for change in IR is the rapidly changing communication landscape. Twenty years ago social media barely existed, and even email was seldom used in investor relations. Today, investor relations is expected to communicate compulsory and occasionally voluntary announcements on company websites, social media accounts, and through email. Furthermore, email is currently the preferred method of communication for buy-side professionals, and is an integral part of any investor outreach campaign.
As such, IROs should ensure they have clear communication guidelines and competencies for a variety of digital communication tools. Familiarity with investor targeting tools, shareholder monitoring software, research and estimates, and an investor CRM are all assets.
Remote or Hybrid Workplaces
One of the major themes of recent years is whether or not employees should be expected to work in the office or remotely. For IROs, the reality might look different than the average office worker given the need for proximity to executives and board members.
There are some aspects of the role that can be carried out remotely, namely investor outreach, voluntary disclosures, and other public relations duties.
That said, there are many aspects of the role that are challenging or impractical for remote workers. These duties include board meetings, roadshows and presentations, and earnings season. Additionally, face time with the CEO and other key board members is crucial for building the internal relationships needed to effectively advise on strategy.
In order for a hybrid role to work effectively, IROs should plan to visit the office a few weeks per quarter. These visits should coincide with any work that benefits from facetime or team collaboration, such as executive profiling or earnings reports. That said, more facetime is almost always better, and prospective IROs may find it easier to pursue in-person roles or negotiate relocation packages.
Conclusion
With the industry subject to rapid technological and cultural changes, it’s crucial to stay up to date on the latest news, laws, and investor relations trends. Pay attention to professional organizations, current events, your investors, your organization, and ir-jobs.com to stay up to date on the latest needs and expectations in investor relations.