The New Year’s Message for Corporate IR Engaging the Buy-Side: Keep Talking

By December 5, 2019 Corporates
The New Year’s Message for Corporate IR Engaging the Buy-Side for Corporate Access: Keep Talking

“With the technology at our disposal, the possibilities are unbounded,” said Stephen Hawking in 1994. “All we need to do is make sure we keep talking.”

Although the brilliant scientist recorded the (otherwise very inspirational) quote for the purposes of a British Telecom commercial, the spirit holds true for corporates and their market partners. 

Corporate access has come a long way in the last decade, especially after sweeping changes brought about by regulations like MiFID II. 

The legislation unbundled costs for research and for corporate access from trading fees at big investment banks. This resulted in increased costs and reduced effectiveness in a lot of IR professionals’ day-to-day.

Surveys and research this past year showed that a strong majority of Investor Relations Officers (IROs) views MiFID II as a net negative when it comes to them engaging investors. Much like on the research side, the changes seem to have impacted small- and mid-cap companies the most. 

Larger firms can afford to continue working with large banks, and they do, because they know they can connect to certain investors and analysts that way. Smaller issuers, on the other hand, have to deal with the added costs and red tape, and seek out ways to get noticed by the buy-side as well as attract analyst coverage.

At the recent IR Magazine Awards – South East Asia 2019 event in Singapore, attendees noted that corporate IR departments need to get more proactive in contacting the buy-side. This is especially important for smaller companies who can’t count on investment banks to connect them like they used to.

The buy-side, which similarly expresses difficulties in connecting with corporate IR teams, has looked for ways to fill that gap. For example, certain buy-side firms set up internal corporate access teams to help drive their outreach, where in the past they relied on such teams within investment banks.

The Answer Is Online

But even that doesn’t necessarily solve the discoverability problem. There are a lot of companies out there, especially in the small- and mid-cap circles, and even dedicated buy-side corporate access teams can’t reasonably be expected to discover your company all by themselves.

This is where Professor Hawking talking about technology comes into the picture. Online networks have brought professionals and companies together in unprecedented ways, allowing for connections that would have previously been either too expensive or too time-consuming to establish.

At Smartkarma, we created just such a network for bringing together investors, analysts, and corporate IR teams. There is a range of online tools and features at an IRO’s disposal 24/7, in a network where analysts (or Insight Providers, as we call them) have already published over 25,000 pieces of research, and where institutional investors visit daily to read research and interact with the platform. 

It’s an all-in-one solution for IROs to initiate, establish, and cultivate relationships with the buy-side as well as analysts. This is possible thanks to in-platform messaging capabilities, seamless collaboration between platform and email, and comprehensive directories and investor-targeting features that help IROs make the right connections.

We also wrote an entire guide for IROs who want to get full mileage out of their corporate access strategy.

Read our eBook: The Cost-Effective Guide to Expanding Corporate Access

Such streamlining of communication avenues is particularly important as 2019 comes to a close. This year, markets started coming to terms with MiFID II’s impact and the European Union announced it will revisit certain aspects of the legislation. What’s coming in 2020 is far from certain – which is why it’s important, as Dr. Hawking insisted, to keep talking.

Find out what else Smartkarma Corporate Solutions can do for your company. Learn more by signing up for a FREE account and experience a brand-new range of services for C-Suite and Investor Relations personnel of listed companies, designed to help IR professionals establish and maintain valuable connections to the investment and analyst communities.

Lead image by Antoine Barrès on Unsplash

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