The traditional day to day tasks of the IRO have been fundamentally transformed in this new regulatory environment where all messages and communication must be made public.  Gone are the days when the daily chat to update company news with the “best friend” analyst was the practice for most IROs.  Selective communication across all outlets, media and private, is no longer allowed. 

So what value does the IRO bring to the table?  What do you really need after the IPO euphoria has passed?  The company message has been crafted with the Investment Bankers and is probably good for a couple of months following the listing.  It is then time to turn to an experienced IRO, not that junior associate the big IR firm has most likely assigned to your account.

Here is what to look for in choosing an IRO:

·       judgment to position the company positively but not to establish unrealistic expectations with potential to damage credibility;

·       crafting messages with the understanding of what analysts are thinking and expecting;

·       maturity to interact with management, obtain consensus, and look out for long-term company interests;

·       choosing correct language to convey future performance, positioning it correctly, and insight when to best use it;

·       ability to write concisely, compile all thoughts, and efficiently produce an earnings release, company news, investor presentation, and other written collateral.

Outsourcing provides an objectivity that is often difficult for an internal employee to exercise.  It also allows you to have a senior person for significantly less than the cost of a full time experienced IRO. Whether your investor relations is conducted internally or outsourced with a trusted partner, it is a strategic position that is essential to the fair valuation of the company’s stock price.

Published and  copyrighted content: July 21, 2010 by

As the quarterly earnings season for the second quarter of 2010 gets underway, investors, analysts and the media will be watching to see how well public companies are emerging from the economic downturn, and what that might mean for the stock market. With unemployment rates still high and federal measures of economic growth shaky, observers are hoping for earnings numbers that reaffirm signs of a recovery.

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In today’s volatile markets it is essential, more than ever, to keep the communication line open with the investment community.  Many companies are overwhelmed with everyday challenges and some feel like it just isn’t worth the effort.  This oversight carries a heavy cost for the company and the valuation of its stock price.

 It is in difficult times that investors need to hear a company’s strategy and outlook.  They need to understand how management is dealing with the current economic challenges and how the company will manage its growth as markets regain stability.