Budgets may fall but team sizes expected to hold
Almost a third of IR teams have seen a drop in their budgets since the outbreak of Covid-19, with 35 percent anticipating a budget decrease in the coming months. Nearly half (45 percent) of IR teams either already have seen or expect to see a fall in their budgets in this period.
Regionally, it is in Asia, where the outbreak was first experienced, that IR teams are most likely to see a decrease in budgets. Half of Asian IR teams have already seen a fall in their budgets, with 55 percent expecting an initial or further fall in the coming months. In North America, less than a quarter of teams have seen a drop in budgets.
There are few differences in budgetary changes according to company size so far. But notably more IROs at smaller companies anticipate budget cuts in the coming months than do IROs at larger firms.
The size of IR departments globally has been largely unaffected by Covid-19, with just 2 percent seeing an increase and 2 percent seeing a decrease in numbers since the outbreak. Nor do IR teams expect to see changes to their numbers in the short term, with just 6 percent anticipating an increase and 4 percent a decrease in the coming months.
There are no real differences in these findings according to region or company size, with the vast majority across the board expecting IR team sizes to stay the same over the course of this pandemic.
There has been a slight increase in senior management involvement in IR since the outbreak of Covid-19: nearly one in five IROs has noticed an increase in senior management IR involvement, while one in 20 has witnessed a decrease. Three quarters of IROs expect to see no change in senior management involvement in the coming months.
Increased senior management involvement in IR is seen more in Asia and North America than in Europe, where only 6 percent of IROs have witnessed an increase. IROs at smaller firms are almost twice as likely as those at larger companies to have seen greater engagement by senior management. Both these trends in senior management IR involvement according to region and market cap are matched when IROs are asked whether they anticipate changes in the coming months.
More IR teams have seen a decrease in the use of external services since the outbreak of Covid-19 than have seen an increase, although the majority of IROs have seen no change. But more IROs anticipate an increase in outsourcing in the coming months than expect a decrease.
A quarter of Asian IROs have seen a drop in outsourcing levels and a quarter expect to see a drop in the coming months. While more North American and European IROs have seen a decrease than an increase initially, roughly a quarter of each expect to see an increase in external service use over the next few months.
Smaller companies have seen greater change in outsourcing than larger companies, with just over half expecting outsourcing levels to remain the same in the coming months.
More than a quarter of companies globally have seen an increase in discussions about IR at board meetings since the outbreak of Covid-19. This is expected to continue with three in 10 IROs expecting an increase in IR discussions with the board in the coming months and no one expecting a decrease.
Board engagement with investor relations has grown most in North America, with 38 percent of IROs seeing an increase in discussions of IR at board level and the same percentage anticipating an increase in the coming months. A third of IROs at larger companies have seen more IR board discussions compared with less than a quarter of those at smaller companies, although more IROs at smaller companies anticipate an increase in IR board discussions in the coming months.
