Investor relations is all about transparent communication

Although investor relations (IR) is a relatively young subject compared to the entire field of public relations, we can observe its dynamic development in recent years. On the one hand, the driving force here is, of course, digitalisation and the intensive development of new technologies, which offer the possibility of convenient and easy access to the most important information. On the other hand, the last few years have been the era of start-ups and fledgling businesses seeking external funding, e.g. through equity crowdfunding campaigns. In this case, dialogue with potential shareholders based not only on presenting financial results for the next quarters is key. It is about building a real relationship based on trust and constant sharing of information and company news.

Let us remember that it was our shareholders who trusted and invested in our start-up, as it were, a little 'in the dark', based on plans and promises. Let us therefore repay them with real access to the 'inside of the company', and treat them as equal co-owners. It is impossible not to mention in the current situation the significant impact of the coronavirus pandemic on capital markets and company valuations. It is causing a great deal of uncertainty among investors, which makes it all the more necessary for us PR professionals to put even more emphasis on open, two-way communication. In difficult times, those who invest in regularly and successively building a positive image among investors from the outset, becoming credible and trustworthy even when the market is in a tough atmosphere, 'win'.

Investors well informed

When talking about investor relations, it is worth mentioning two groups of investors who usually gather around a given company. Some of them are people who are not heavily involved in the life of the entity, without in-depth knowledge of it. These types of investors make decisions quite spontaneously, e.g. on the basis of the so-called information noise generated in the media or forums. The other part are investors who are well informed, have a solid and constantly updated knowledge of the situation of the entity they are interested in. At the same time, they are less susceptible to the aforementioned information noise.

As one can easily guess, the aim of IR professionals should be to gather representatives of the latter group around the company. It is us, not them, who should care about building relations and trust through an open and partnership-based approach. It is thanks to a well-thought-out IR strategy that we have the chance to create a community around our company, which will stay with us regardless of the atmosphere on the market.

When planning communication with investors, we must assume that they are not in a position to follow all market news. Inundating them with periodic reports or obligatory announcements will not build dialogue and relations with them. Let us focus on ensuring that communication brings added value. What, in this context, is worth bearing in mind?

Involve investors in the life of the company

How can we best ensure that our investors trust us? Let's invite them in, into the company, let's treat them as co-owners, regardless of their level of financial commitment. Let's share with investors not only quarterly results, but also introduce them to the most important projects on an ongoing basis, consult with them on plans, thoughts. Let them feel that they are part of the company and that we actually count their opinion. If we have experts on board who can prove useful for the development of our business, let's involve them even more, for example by inviting them to the Supervisory Board - let's use and benefit from their knowledge and experience. Let's also avoid surprises - let's keep investors in the loop on key decisions, let's let them know about them before we communicate a thing more widely.

Reach out to investors where they are actually present

Let us remember that it is important for an investor to have easy access to information that interests him. Following the galloping development of new technologies, let us be present with company information where it is desired by our environment. In short, let us focus on the digitalisation of investor relations. The basis and standard should be a modern, intuitive website dedicated to investor relations, additionally adjusted to mobile devices. In the face of pandemic, but also widespread digitisation, virtual meetings, including General Meetings of Shareholders, are also gaining importance.

A social media strategy that allows for less formal communication and 'breaking the ice' with our entity's business community is also key. Let's remember to use the different platforms holistically: Facebook, Twitter, LinkedIna or YouTube. Finally, in line with global trends, modern solutions such as Big Data or artificial intelligence and communication automation, which will allow us to personalise content according to the needs of a given investor, such as within a dedicated IR platform or mailings sent to subscribers, will gain in importance.

Opt for diverse forms of communication

The basis of IR communication is the aforementioned transparency and the provision of concrete information that is interesting from the perspective of the recipient. In keeping with the spirit of the times, let us show these specifics in an accessible form. Today, we cannot imagine communication without interactivity, without animated content, without attractive video or investor presentations that are engaging but rich in content. Let our audiences feel that we care not only about the content of the communication itself, but also about its quality. On the other hand, we should also keep diversity in mind - there is certainly still a group of people among our recipients who, instead of following our social media, prefer to read an interview with the CEO of our company in the paper edition of Parkiet or Puls Biznesu☺ over their morning coffee.

While the evolution of investor relations is playing out before our eyes, its basis is still to reach out to audiences as a credible and trust-building entity. What is changing is how we can gather an engaged community around us. And engagement and 'loyalty' to the company is key in these uncertain times.