Earlier this year, I wrote a blog post that recounted a discussion that ensued on #irchat regarding one of Rivel’s research findings in late 2009 regarding IR’s role in a company’s valuation.
An interesting discussion developed when Dan Dykens, CEO of Meet the Street and host of #irchat asked “What do you think about Rivel Research’s buy-side survey which suggests that the valuation differential between good and bad IR is 35%?”
This question stirred up quite a debate, especially since no one had access to the methodology or a definition of what constitutes “good” vs “bad” IR. So the responses were based on the information we had.
Shortly thereafter, Brian Rivel, president of Rivel Research Group, the firm specializing in perception research for public companies posted the following comment:
Glad to see that this data sparked such a debate! One of our most popular findings, as you might imagine. Just as an FYI, the study goes on to define what IS superb IR, according to the buy-side. That result can’t be looked at in a vacuum. I would be happy to provide more flavor to anyone who is interested.
With that, I jumped at the chance and contacted him for an interview:
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In a recent edition of IR Alert, Jeffrey D. Morgan, CAE, President and CEO, National Investor Relations Institute cites “the top challenge facing IR now is regulation including moves to have companies become more transparent, governance changes and generally looking at corporate practices. Regulation is one of the key challenges right now. It’s evolving rapidly and where we’ll end up is not quite known.”
What follows is some of his advice to IR professionals for keeping pace in this rapidly changing regulatory environment. He also discusses current challenges and opportunities and ways to address them.
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As you may know, Q4 conducted a webinar a couple of weeks ago on IR Website Best Practices. The main theme was ‘Avoiding the 5 Barriers to Effective Communications‘:
1. Home page/investor index lacks easy access to key information.
2. Content does not convey/summarize a compelling investment proposition.
3. Information is not geared to various investor audiences.
4. Key content is missing, in wrong format or just not engaging.
5. Lack of tools to aid relationship/brand building.
We also used a few case stories to illustrate how leading issuers are maximizing their websites to communicate their investment propositions and unique advantages.
I recently read an interesting article entitled “Corporate Tweets and the SEC: Sometimes It’s Better to Keep Your Mouth Shut” which provides some insights and commentary on social media, investor relations and web disclosure.
Since the SEC announced its recognition of corporate blogs as public disclosure in July of last year, social media has been used quite effectively by PR, marketing, and advertising professionals. However IR practitioners are still pondering the risks and opportunities outlined in the recent SEC guidelines.
There are many things to consider for integrating blogs and other social networks into an IR program – such as disclosure and adhering to legal compliance. This is quite a dilemma as the adoption of social media has exploded and continues to be a medium of choice for millions of individuals hungry for instant information. Read more…
We had a great turnout at our first ever webinar yesterday – IR Website Best Practices. Catherine Crofton, VP at Q4 discussed five common barriers to effective web site communications to an audience of representatives from Canada, the U.S. and the UK. (Our CEO, Darrell Heaps also Tweeted the event with lots of links to examples).
We attribute the large turnout to the fact that the web and the IR website is now the dominant channel for investor communications and many companies are looking for ways to do things better. We were really pleased with the number of people that attended and that we had lots of questions at the end. We’ll be doing webinars on a regular basis so be sure to subscribe to our RSS feed or email alerts to stay up to date.
For those of you who missed it here are some highlights of the common barriers:
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I attended an interesting CIRI (Canadian Investor Relations Institute) round-table luncheon yesterday, and the topic of discussion was Understanding how the buy-side makes decisions . The format of the session was great; it was almost entirely Q&A and provided the opportunity for participants to openly dialogue with the speakers. The panelists were Stephanie Griffiths, Lead Portfolio Manager for Mackenzie Ivy Enterprise Fund, and Craig MacAdam, Portfolio Manager with the Aurion Capital equity team. Both were frank and concise in their answers, and while much of the information they provided was fairly intuitive, I did find some of their comments surprising and interesting. Read more…
General Electric, parent of NBC Universal, has gained attention in the blogosphere over the last few weeks since the October 22 launch of its corporate blog, ‘GE reports – Your source for what’s happening at GE.’
The response has been both positive and negative. Criticism has primarily focused on the accessibility of information disclosed in this way – although anyone can receive automatic updates through RSS feeds, which take all of 2 minutes to set up. And North America enjoys the highest penetration of internet usage in the world.
What’s important to note is that GE executives say the blog permits them to disclose more information and on a more frequent basis, which translates into greater transparency regarding issues that would otherwise remain internal. “This is a tough environment, a lot of misinformation in the marketplace,” GE spokesman Gary Sheffer said. “This is just a fast and simple way to punch through it and to make sure that you tell your story in a simple and engaging way.”
This immediacy is one of the many positive outcomes of the new Reg. FD governing corporate web sites and blogs. In terms of engagement, I love the fact that GE incorporates video to support many of their blog stories. (Jason’s post on the Q4 blog yesterday sited another great example of this tactic, as employed by Overstock.com.)
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As many of you know, over the past several weeks I have been speaking with issuers of all sizes across North America – both U.S. and Canadian inter-listed companies – regarding their transition to a web disclosure model.
Most of the companies I’ve spoken with are intrigued by the potential cost savings of disseminating their disclosure without the expense of newswires. Some of the companies I’ve spoken with are busy putting plans in place to meet the new SEC criteria. Others have been made to fear that adopting this method of disseminating information to the market would prevent them from attaining simultaneous disclosure.
Most are wondering what steps they need to take to transition to this model. Although I have dealt with this more specifically in previous blog posts, here is my 1,000 foot perspective:
1. Inform yourself of what’s possible from a technical standpoint and obtain opinions from a number of sources. To optimize web disclosure according to the SEC’s new guidance, your goal should be to investigate technologies that enable you to easily meet the SEC criteria while minimizing risk for your company. You may have to pay more than you do now for this technology, but taking control of your own distribution will allow you to reallocate some of your newswire costs to ensure a more effective web presence.
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I’m pleased to announce that we have closed our latest round of funding, bringing the total raised to $3M (CDN) since the fall of 2006. Investors include a mix of institutional funders and angels. You can access the full press release on our web site:
Q4 Web Systems Closes $1.2M in Funding for Web Disclosure
Here are a couple of my quotes from the release:
I’m very pleased to close this latest round of funding in this current market climate. We continue to receive validation for our business model from the addition of new clients, business partners and our ability to attract investment. This latest round of funding will enable us to continue scaling the business while we roll-out our next generation platform in 2009.
This regulatory guidance is a significant change to how material information is distributed to the market. Not only does it lower costs for issuers, but it also creates opportunities for a number of companies, of which we are one. This investment is a validation of the market potential for our platform and web disclosure in general.
Darrell and I had an interesting conversation with a securities regulator the other day regarding where legislation is headed as fallout to the financial crisis. (This is a topic of great interest to us and at times I find myself providing armchair observations.) Read a summary of the conversation: Read more…