Managing investor relations

How to communicate with investors?

There are several different ways for a company to communicate with its investors, these can be monthly reports containing P&L (performance and loss) information, that give detailed snapshots of the company at that time. Another good strategy is to have monthly conference calls with the investors. It would be wise to have the conference calls and reports done at the same time, so if the investors have any questions about the report, that is the time they can ask those. DUring the conference calls it is also a good time to brainstorm ideas and share ideas. The third and most effective communication strategy is to hold annual, quarterly or monthly meetings with the investors. The investors often want to meet face-to-face and see the operational side of the business and this gives them the opportunity to do so. It should be remembered that scheduling these meetings well before hand is essential and they should not be held too often. If these meetings are held on a monthly basis, it best to actually have them every 5 or 6 weeks, not 4, to give time for stuff to actually happen. It is also recommended to have about 8 meetings per year, and not hold them during august and december, because of the traveling schedules of people.

How to build trust between a company and investors

9 elements of effective investor communications:

1. Know when to disclose to the market.

2. Admit when things don’t go to plan.

3. Build relations with investors in good times as well as bad.

4. Be transparent about sources of funding.

5. Be consistent with investment criteria.

6. Give investors exposure to a broader group of individuals.

7. Bear in mind the local competition.

8. Articulate a “Plan B.”

9. Avoid surprises.

The best way to build trust with investors is to have good investor communication. Hold well planned board meetings and keep the investors up to date. Avoid surprises and be honest with the investors, let them know about any difficulties and do not keep secrets. 

How do share-/stakeholders influence corporate strategy?

Shareholders of a company have a huge say of the aims of a company. The main thing that they are concerned about is making profit, and this shows in their actions. They make clear profit objectives that they expect to be met. They are also typically short-term oriented and want to make profits quickly. The pressure from shareholders can affect the decision making of managers. Shareholders also vote on major corporate decisions. Shareholders can also influence the strategic planning of the company and for example put cutting costs before ethical issues.

Managers influence a company all the time with their decisions. They decide what to produce, and who to hire and fire. They also decide about company policies and make strategies that affect the profitability of a business.

Employees can influence the success of an organization by their productivity and efficiency in the job, duties and tasks they do everyday. If they disagree on working conditions or pay, they can also go on strike.

Suppliers can raise prices for orders and their reliability can affect production and delay the shipping of finished goods for customers. Suppliers can also change credit terms which may have cash flow issues for a company and they could decide whether or not to allow discounts for bulk orders or loyal customers.

Government can introduce new laws that can affect operations, such as minimum wage or they can raise taxes which would have an effect on firm's profits.

Customers can influence a company by their purchasing decisions 

Banks influence companies by giving or denying loans and charging interest rates.

Local Community can have an influence in a company, by for example petitioning against their new developments or building permissions.

Examples of Investor Relations communication

Twitter

Websites:

Sources:

http://www.forbes.com/sites/patrickhull/2013/10/16/choosing-the-right-strategy-when-communicating-with-investors/

http://www.businessinsider.com/how-to-communicate-well-with-your-investors-between-board-meetings-2010-5?IR=T

http://www.ey.com/GL/en/Issues/Managing-finance/CFO---A-tale-of-two-markets---Top-investor-communication-tips-for-CFOs

http://www.bbc.co.uk/bitesize/higher/business_management/business_enterprise/business_contemporary_society/revision/10/

http://smallbusiness.chron.com/shareholders-affect-business-65880.html

http://www.entrepreneurship.org/resource-center/managing-a-mailorder-marriage-building-trust-with-your-vc-investor.aspx