Cision recently partnered with the National Investor Relations Institute (NIRI) to release The State of Investor Relations in the Virtual World report, an in-depth look at the challenges and opportunities IR teams are facing in a still uncertain time. For the study, Cision and NIRI spoke with senior IR leaders from companies representing a broad set of industries and market caps to get their views on 1) how they responded to an unprecedented year with a crisis around every corner and 2) where they see the industry headed. Among the findings, four major trends emerged.
Trend 1: Embracing Technology and Innovation
It should come as no surprise that COVID-19 was a major disrupter for the IR industry. The vast majority of respondents (83 percent) said the virus had somewhat or strongly impacted their programs. Yet, more than more than 90 percent felt satisfied with how they pivoted to deal with the new reality. For many, embracing new technology was the key to their success in connecting with portfolio managers, shareholders, analysts, retail investors and the broader financial community. Many IR teams pivoted from face-to-face meetings to video and phone calls. One participant cites how the move created more engagement from portfolio managers, who normally do not travel but could easily join a virtual conference.
Trend 2: Increased Focus on CSR and ESG
Corporate Social Responsibility (CSR) and Environmental, Social and Governance (ESG) initiatives got renewed focus in 2020, spurred in part by the protests for social and racial justice that began in May. According to one participant: "This year really accelerated what investor relations professionals were having to communicate around ESG, primarily [around] human capital measures, diversity, inclusion, health, and safety of employees, and benefits offered during COVID."
Looking ahead, IR will continue to highlight companies’ ongoing investment in CSR and ESG initiatives as consumers, investors and partners gravitate toward more purpose-driven businesses. Similarly, while Diversity and Inclusion (D&I) has long been part of IR communications for many companies, over a third of IR respondents (36 percent) indicated that the events of 2020 brought the conversation further into the spotlight for their organizations.
Trend 3: Newswire services continue to dominate
When it comes to releasing their quarterly earnings reports, all respondents – without exception – said they rely on newswire services. Nearly all of them (98 percent) also post the information on IR websites, while 30 percent utilize social media. Contact CRMs were also among the top communications vehicles for IR teams.
As for what messages IR professionals are communicating via these channels, the vast majority (90 percent) are actively engaging investors as they predict and react to trends. Nearly two-thirds are using them for disclosure purposes, while around 20 percent are commenting on market volatility and mergers and acquisitions. Activism, crisis communication, and financing were also cited.
Trend 4: Planning Around an Uncertain Future
When asked what their plans were for their 2021 events (including shareholder and annual meetings or investor days), 45 percent of respondents said they will host a fully virtual event, while 42 percent said they are undecided. Only 6 percent plan on hosting in-person events, while 4 percent said it will be a hybrid (both virtual and in-person).
Heading into 2021, one of the biggest priorities for IR teams will be finding new and creative ways to interact with current investors -- and attract new ones to their companies. Many are also planning to enhance existing digital tools such as their IR website. Along the way, they will continue to assess how their current virtual engagement strategies are working and adjust accordingly.