As the corporate world becomes further complex and competitive, it is essential that companies start to give more focus on the aspect of investor relations (IR). Scott Tominaga mentions that the IR department is especially needed in the medium-to-large public companies of today as it provides the investors with an absolutely accurate account of company affairs. These details subsequently aid investors to make well-informed decisions as they decide on putting their money in a firm. The IR department typically has to be well integrated among the legal and accounting department of a firm, as well as its executive management team.
Scott Tominaga marks a few pointers to help build and maintain investor relations
Investor relations makes sure that the publicly traded stock of a firm is being traded in a fair manner through the proper dissemination of vital information that enables investors to orderly determine whether a company would be a good investment as per their requirements. Scott Tominaga mentions that the professionals belonging to the IR department quite commonly communicate with the investors, government organizations, shareholders and other stakeholders of a firm in important matters. Here are a few pointers that the professionals belonging to this domain follow in order to both build and develop investor relations:
- Balance being promotional with visibility: It is a good idea for a company to stay active in multiple investor conferences and take part in non-deal road shows. These events typically keep a firm adequately visible among the current shareholders, while also aiding them to make connections with new ones. However, companies must try to make sure that they do not appear to be too promotional in such events, so that it leaves the investment community wanting more. A balanced approach towards business promotion can, in fact, augment the credibility of a firm.
- Build a relationship on the basis of mutual benefits: Managers should start to build relationships way before they plan to seek investment. The relationship between a company and its investors must ideally be built on the mutual benefits of being experts in the relevant field, which include mentoring and knowledge sharing. This way companies would get the chance to get in touch with investors who wants to help them to flourish and succeed.
- Take a fresh look at last year’s plan and strategy: People can a lot from the result of the investor relation plan of the previous year. Moreover, it is also much easier for companies to make edits on the last year’s plan rather than starting one from scratch. IR professionals must not be afraid to think creatively, as well as to revaluate and develop plans by incorporating new business trends along into the investor relation plans made early on.
- Think beyond finances: It is crucial to note that investors are professionals in their own rights and not just walking additions to the budget. Hence, managers can opt to seek out valuable guidance and help from these professionals.
According to Scott Tominaga, a good IR strategy is crucial to ensuring the overall operational consistency and success of a firm.