Investor Relations, like most sectors, has been disrupted by the Coronavirus pandemic in ways we would never have expected just a few months ago. So what qualities do IR professionals need to demonstrate in order to satisfy both the demands of investors and the expectations of their executive team in the current climate?
Organisations are moving quickly to share information, update earnings guidance, and reassure investors that governance standards are being maintained in a world in which entire businesses are being run remotely for the first time.
But restrictions on large gatherings, travel and concerns from investors about attending physical meetings during the COVID-19 pandemic are forcing changes in the way Investor Relations, and the communications programs that support it, are being conducted.
Regulators around the world are adapting to the same environment, releasing new guidelines governing how Investor Relations may be conducted in a largely online business world.
The new IR communications landscape is overwhelmingly a virtual one, with four in five (80%) respondents preferring digital channels for communicating with investors ahead of face-to-face events, according to a recent survey Redback conducted in partnership with the Governance Institute of Australia.
Virtual investor events are becoming increasingly popular, with 22% of respondents preferring online investor events to physical ones — a figure that is likely to increase dramatically due to the impact of COVID-19.
For a detailed run-down of the changing communications framework for Investor Relations, check out the full survey here.
Meanwhile, looking at the data and other trends driven by the impact of COVID-19, we’ve identified 5 fundamental characteristics Investor Relations professionals must demonstrate to communicate effectively in the current climate:
Organisations and their IR professionals are always very conscious of the need to be accountable to their investor community. This will only become more important in a remote working world, where investors will expect similar standards to be maintained via online and virtual channels in the current COVID-19-affected environment.
Increased public company scrutiny and the rise of social media and shareholder activism continue to contribute to an always-on approach to Investor Relations.
Digital communications and virtual investor events can support the increased frequency of communications that an active shareholder community demands.
Enabling investors to follow and connect with organisations in whichever channel they prefer is critical to Investor Relations in the current disrupted communications landscape.
Organisations can now connect with large and dispersed investor communities across geographic boundaries, enabling them to potentially open up new investor opportunities.
With restrictions on travel and large gatherings designed to limit the spread of COVID-19, IR professionals must become comfortable and familiar with digital channels and virtual investor events to provide all shareholders with the access and information they need.
In a COVID-19-affected world, the corporate watchdog ASIC considers virtual investor events such as online Annual General Meetings are now acceptable under regulatory guidelines to enable companies to communicate with investors without contravening social distancing guidelines and travel restrictions.
IR professionals in organisations with a December 31 reporting date may hold hybrid or virtual investor events without fear of being penalised by ASIC, so long as they provide the ability for attendees to fully participate via online Q&As and virtual voting mechanisms such as polls.
Essential to this is the use of robust, feature-rich virtual meeting technology with accessible local support and contingency planning to accommodate the increased load on digital infrastructure in the current climate.
With increased business pressures in the difficult economic conditions created by COVID-19, it is critical for organisations to lift their game when it comes to how they engage and interact with investors online.
This may include the need to provide access to video, slides and other engaging online communications formats and events, as well as the ability to interact with executives.
It should also include tracking the investors that access those resources to gauge areas of interest and commitment — valuable information for any company executive team.
The need for secure IR channels is not negotiable, with organisations preferring confidential channels that offer controlled access to information and events, as well as the ability to monitor and control participant activity.
Also important is improved contingency planning including technology back-up and support in these uncertain times, given the increased load on digital communications infrastructure in a remote working world.
On top of that, organisations that continue to hold hybrid or physical shareholder events must mitigate against the risk of spreading COVID-19 with strict social distancing protocols — a recent development that all Investor Relations professionals must now build into their IR event programs.
IR communications in a COVID-19-affected world must be virtual, accessible, accountable, engaging and secure.
IR professionals today are overwhelmingly taking advantage of new digital media channels and virtual event and online conferencing technology to deliver against these requirements, forging strong relationships with shareholders and investors, and providing valuable insights to their executive teams.
Redback Connect helps Australian and New Zealand organisations connect with investor communities across distance, providing a secure, feature-rich virtual conferencing platform that enables shareholders to interact fully with company executives. We design and deliver high quality digital events from concept to completion including AGMs, virtual conferences and live-streamed company announcements. Contact us to find out how we can help you hold your next shareholder event online.