By Paula Phelan
In a logical world, investor relations and public relations would work in harmony, bringing together the perfect blend of brand awareness, product value and differentiation for customers and investors. In today’s upside down economy IR and PR rarely speak, much less coordinate campaigns. In fact, over the last two decades they have grown further and further apart. The question is – will this natural relationship end up permanently estranged or is there hope for a reconciliation?
Understanding Roles
To answer that question it may help to better understand the roles of Investor Relations (IR) and Public Relations (PR). While both teams are responsible for promoting the company, they rarely work together. Each group reports to different corporate officers; IR is responsible for communicating the finances of the company to financial analysts, investors and shareholders, placing them under the purview of the Chief Financial Officer (CFO) while PR reports to the Chief Marketing Officer (CMO) and is charged with promoting the company’s products or services to industry analysts, media, customers, partners, prospects and depending on the size of the organization, employees. The CEO is the only executive who crosses the great divide, holding court with both groups; IR when preparing earnings calls and acquisitions and PR when announcing new products and offerings.
As workloads have increased and resources have become scarce the IR and PR teams have hunkered down and focused on the tasks at hand without any thought of each other. Opening a dialogue between the two could potentially strengthen and clarify a company’s message while increasing visibility, resulting in more sales and stronger partnerships.
Immediate and Easy Ways to Improve Relations
There are several quick and easy ways to start benefitting from an open dialog between IR and PR.
Sharing Timelines:
Both groups maintain timelines of upcoming events. For PR the focus is on press releases, trade shows and speaking opportunities at events and awards. IR looks towards quarterly results, scripting earnings calls and end of year 10Ks. By sharing key dates and information, each group is able to benefit from shared knowledge and upcoming deadlines, making the creation of original documents more efficient and of greater value across the company landscape.
Industry Trends:
PR monitors the latest industry trends, leveraging news and working with the media to produce coverage through executive thought leadership programs. IR is often buffeted by news items that may result in investor demands that require an explanation on how the company plans to address a new trend or a perceived weakness in a current product offering. If PR advised IR of the trends as they occur, IR could respond confidently to shareholder calls following an industry event. Also, if IR sent out a weekly or monthly note regarding typical questions being asked, PR could capture approved CMO and CEO responses based on industry analyst and media briefings.
Coverage and Success:
PR success is measured by the number and quality of articles secured for the company. Often these pieces are not seen by IR until they search the company website to determine what coverage has been obtained in the last quarter (assuming the website is kept up to date). Since the PR team disseminates coverage wins to the marketing team as they post, it would be simple enough to include IR on the communication thread.
In a perfect world IR would see ongoing coverage reports, enabling them to pick and choose items that may be of interest to IR’s key audiences as they happen. For instance, large investors put a great deal of value on awards. In this case, awards would be sent immediately to IR so that they can promote them in their next discussion.
With a combined effort, and by reducing redundancies in workflow, the quality of communication would generate greater interest from prospects and investors, while improving ROI.
Irreconcilable Differences
If things continue as they are – opportunities will be lost. The current partnership isn’t focused on collaboration and has historically led to both parties lacking a complete understanding of pertinent information. However, during a time of limited resources and a demand for transparency, it seems a shame to lose any opportunity to enhance customer and investor satisfaction.
