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Publicly quoted companies cannot determine who buys or sells their shares, but they can have a significant impact upon the construction of their shareholder register through their IR programme. Each type of shareholder will have their own investment characteristics. For example, private investors may be more loyal and hold the stock longer than institutions. Yet private investors are likely to have relatively little individual impact on your stock whereas one institutional buy or sell decision can have a major effect. Hedge funds, on the other hand, may introduce an element of volatility into your stock by buying and selling large tranches of shares in a relatively short period.
It is in the interests of an IRO to try and identify which types of investors have holdings in the company. Your broker, registrar and IR consultant should be able to help you in that process. Armed with that knowledge, you are in a better position to know how your stock might react to certain corporate news. You can also begin targeting particular types of investor to slowly change the make-up of your shareholder register should it be desired.
The most common problem with web sites is that they fail to take into account the needs of the user. Your web site might have far more corporate information than any of your competitors but it will be useless unless users can navigate easily around the site.
Make sure that your IR home page offers easy links to the most frequently accessed information. You should maintain a regular check on which pages are being accessed the most and then bring those pages to the fore when redesigning the site or via button links from the home page. A good search engine facility on your site can help users locate the information they need. The most advanced IR web sites are now allowing visitors to ‘pull’ the information they want from the site by defining their own virtual home page.
The IR web site is the easiest and most costeffective way of keeping your audiences up to date with corporate initiatives but it should not be seen as a replacement for sending out releases to the market via the PIP system. Use the web as an added channel of information to grant access to your investor presentations, analyst meetings, and site tours. E-mail alerts are easy to set up so that interested visitors can register for up-to-date news but, as with the warning on company statements, do not abuse the system by sending out too much information. Your audiences will soon lose interest in your alerts.
Traded companies are advised to monitor internet chat rooms but to steer clear of responding directly to chat or rumour within the chat rooms themselves. You should invite feedback via your official IR web site and develop a consistent rule for responding to rumours that operates across written, spoken and electronic communications.
Source: LSE Investor Relations Practical Guide (see IR Downloads) |
