Compensation, external spend and career path
IR team sizes
The average number of people working in IR at small-cap companies is 1.5. This is more than a whole body lower than the overall average of 2.6 among companies of all cap sizes. Small-cap companies typically have half the IR personnel found at large-cap companies and a quarter of the personnel seen at mega-cap firms.
IR team sizes for both small caps and overall have remained consistent since 2013, with small-cap IR teams always having just over one member fewer than the average for all cap sizes.
IR salaries and bonuses
The median salary ranges for IR professionals at small caps is the same as those among all cap sizes: $150,000 to $199,999 for IR heads and $75,000 to $99,999 for IROs. But 39 percent of IR heads and 31 percent of IROs at small-cap companies earn above the median pay bracket, compared with 47 percent of IR heads and 48 percent of IROs at companies of all cap sizes. This means IR professionals at small-cap companies typically earn less than the overall average, although not to a significant degree.
Bonuses are also lower at small caps: 21 percent for IR heads, 18 percent for IROs, compared with 32 percent and 25 percent overall.
Career path
IR professionals at small caps come from similar backgrounds to those at other cap sizes, with 53 percent coming from a corporate background and 30 percent from a capital markets background. This compares with overall figures of 58 percent for corporate and 29 percent for capital markets.
IR professionals at small-cap companies are much more likely than professionals at other cap sizes to have multiple roles and additional responsibilities outside of IR. Just 9 percent of small-cap IR professionals have IR as the sole focus of their job with no additional responsibilities, compared with 31 percent of IR professionals across all cap sizes.
Nearly six in 10 IR professionals at small-cap companies also have responsibility for corporate communications, 43 percent have PR responsibilities and 42 percent are involved in corporate strategy.
IR budgets
Small-cap companies have less cash to spend on IR than companies of other cap sizes. The average IR budget is $393,000, which lies between the average budgets for mid-cap and large-cap companies. Small-cap firms have an average budget of $232,000 – $161,000 and more than 40 percent less than the average for all cap sizes.
The gap in IR budgets between small-cap companies and others has narrowed over the past nine years. While IR budgets overall have gone down by almost a third in this time, small-cap budgets have remained fairly consistent and are now just $18,000 lower than their 2011 figure. This means the difference between small-cap and all-cap IR budgets has almost halved since 2011, from $311,000 to $161,000.
External services
Small-cap companies typically spend 37 percent of their IR budget on external services, 4 percentage points more than the all-cap average. In real terms, this amounts to an average of $86,000, 33 percent lower than the average spend of $130,000 among all cap sizes.
What IR departments at small-cap companies choose to outsource and their levels of outsourcing are more a matter of resources than desire. For example, just 28 percent of small caps commission perception studies compared with 46 of companies across all cap sizes. But 56 percent of small-cap IR professionals say they would outsource perception studies if resources permitted. This is also true of outsourcing targeting.
