A Descriptive Account of the Investor Relations Profession: A National Study

Abstract

Despite being a practice of vital importance for corporations, investor relations commands little attention in scholarly research. The studies of investor relations from a strategic communication standpoint are almost nonexistent in the United States. At the same time, investor relations today is undergoing a major shift from financial reporting to building and maintaining relationships with shareholders. The article reviews literature to define the current body of knowledge and state of research in investor relations. Then, the article reports on a survey of Fortune 500 companies to identify major investor relations practices at corporations: investor relations activities, their target audiences, their place in organizational structure, the education of investor relations officers, and what problems investor relations officers face.

Ethics and Ethos in Financial Reporting

“…An important consequence of these changes was that businesses had to dedicate more time and resources to the process of financial disclosure. In a survey of Fortune 500 companies carried out by Laskin (2009), preparing financial documentation was identified among the most frequent of business activities, spanning across investor relations, finance, and communication departments.…”

An Increasing Usefulness for Managerial Communication Research on the Main Topics of Management

“…One of the main tasks of the manager is to motivate and communicate, which is a basic skill needed for a manager (Bell, 2011d). In a survey of Fortune 500 companies carried out by Laskin (2009) preparing financial documentation was identified among the most frequent of business activities, spanning across investor relations, finance, and communication departments. Voluntary financial disclosure is on the rise, as it helps companies have more control over the message they wish to communicate, achieve greater visibility to distinguish themselves from competitors, and enhance perceived value (Williams, 2008).…”

Relationship marketing's role in managing the firm–investor dyad

“…1995). Although many companies subordinate its tasks to finance or public relations departments (Laskin, 2009), the IR function increases in scope (Rao and Sivakumar, 1999) due to some key developments.…”

“…To be successful, IR requires companies to expand their activities to more "frequent, extensive, proactive and diversified two-way interaction and communication" (Tuominen, 1997, p. 53), taking into account variation in behavior and preferences of different investor types (MacGregor et al, 2000;Aspara and Tikkanen, 2010). Current IR practice, however, focuses on reactive management of financial stakeholders' requests (Laskin, 2009) instead of establishing proactive and strategic interaction flows. Acknowledging the latter, the next section presents a relationship marketing approach to IR.…”