Go next-level with post-call evaluations and analysis
Once you are under way with including ESG talking points in your earnings call, there are several extra considerations in order to refine your approach and ensure it will serve your company well through to a mature stage.
Stakeholder engagement One of the key ways to engage different quadrants of your investment community is by actively encouraging questions or suggested talking points in advance (via the website or other communication channels). Even unanswered questions can provide valuable data points from your stakeholder audience.
Following up with post-earnings questionnaires is standard practice at many organizations, so consider adding specific ESG topics to this. And do not neglect one of your most important stakeholder groups: corporate management. Make sure you evaluate what it cares about and ensure your IR function gets credit for everything it is doing.
Evaluating channels Earnings calls assumed several new forms during the Covid-19 pandemic, with online and video content taking center stage for many firms as in-person events became increasingly impossible. Leveraging ESG-centric video content is a great way to drive ‘one to many’ communication, and has extended uses both internally and externally to highlight and promote the different areas of an ESG program that can tally with established talking points.
Audiences consider video a top component when it comes to evaluating ESG audiences, and featuring your executives talking directly to them on these issues is a surefire way of ensuring connection.
Listening in Monitoring what the markets are saying and thinking about your firm is a crucial part of the refinement process. Observing traditional media is important – picking up on analyst notes and written reports on how your company is perceived – but social media can be a more revealing snapshot about which issues are considered important.
In addition, a robust analysis of how other companies in your sector, industry and locale are including ESG topics in earnings can give you some crucial points of comparison or indications of what the market may be expecting of you.
Some questions you may try to answer include:
An intersectional approach The pandemic has illustrated how many ESG issues intersect with others – for example, how supply-chain management topics can have far-ranging impacts on other E, S and G factors, such as how human capital, corporate governance or environmental risks are managed at suppliers and service providers.
Taking account of this and developing ways of reporting and highlighting those risks can provide an excellent opportunity to demonstrate transparency to stakeholders and a deep understanding of your supply chain’s wider impacts.
Companies should increasingly be seen to follow such threads throughout their operations, and the outcomes felt throughout their wider ecosystem.
Managing management Many companies choose to include their chief executive and CFO on earnings calls to highlight certain aspects of a company’s performance, provide extra context or answer questions from investors. For communication around ESG issues, the same is often a good starting point, but adding more specific management to communicate around a particular issue can be a great way to add focus.
‘We try to have a guest member of management on our calls,’ says Brian Dingerdissen of Essential Utilities. ‘For example, we include our chief operating officer once or twice a year to give him some exposure to investors and provide a deeper dive into how a utility works, or a specific change in a regulatory environment related to compliance.
‘I find that if your earnings call just speaks to your financials, you’re not going to have too much participation from the investor community.’
If your earnings call just speaks to your financials, you’re not going to have too much participation from the investor community
