Know your audience
Developing an effective IR strategy can seem like an overwhelming task, especially given the volatility of the current macroeconomic landscape. Knowing what to plan in advance and where to allocate resources to get maximum impact – while maintaining the flexibility to respond to changing investor sentiment – needs careful consideration.
Amir Rozwadowski is senior vice president of finance & IR at US-based multinational telecommunications company AT&T. Giving insight into his process, he says: ‘The foundation of any successful IR strategy is grounded in a commitment to understand your primary constituents and then communicate with them in a transparent fashion.
‘This begins with thoroughly understanding who your investors are – retail investors, active, passive, institutional, and so on – and what their current sentiment is toward your firm and overall sector.’
He says defining this sentiment involves answering several key questions. ‘How do investors view your strategy?’ he asks. ‘What are their thoughts on your management team’s credibility? Do they believe you’re well positioned relative to peers? And what do they view as the key opportunities within your industry? Once you can answer these questions, it then becomes your responsibility to better understand what your investors’ expectations are relative to owning your stock.’
For Maria Fontes, head of investor relations and corporate communications at Portuguese bank novobanco, developing an IR plan involves aligning with the company narrative and identifying targets while maintaining flexibility.
‘Our IR strategic goals are aligned with the strategy and business plan of the bank,’ she explains. ‘We consider factors such as how the bank wants to be recognized by capital markets and its investors, what its funding needs are and the targets to be achieved.
Establishing targets at the beginning of each financial year helps the IR team to focus on results
‘Establishing targets at the beginning of each financial year helps the IR team to focus on results, including goals such as a broader investor base and positioning how the institution wants to be perceived in areas like innovation and ESG. In the current environment – characterized by market volatility – being flexible to adapt the message and convey investors’ concerns makes the difference.’
The foundation of any successful IR strategy is grounded in a commitment to understand your primary constituents
Adding her perspective, Rebecca Gardy, senior vice president and chief investor relations officer at Campbell Soup Company, comments: ‘Our IR strategy is primarily structured to achieve a fair valuation. We focus on articulating the company’s financial performance, its long-term strategic plans and its competitive positioning. This includes having an understanding of our audience and tailoring our messaging and outreach to these accordingly – for example, for current shareholders and high-priority targets, as well as appropriately responding to their investment style and degree of sector focus.
‘We structure our engagement calendar, including our conferences, HQ visits and non-deal roadshows in consideration of our overall strategy.’
