São Paulo’s IR supremos

The Brazilian global firms Vale, Petrobras and Itaú Unibanco are among the most actively traded stocks on the NYSE, which lists 30 Brazilian firms with a combined value of $1 tn. The Brazilian companies profiled below all stood out in their communications with investors during the past year, and were rewarded for their excellence in IR at the IR Magazine Brazil Awards 2011, held in São Paulo in July.

Itaú Unibanco
Not surprisingly, Itaú Unibanco, the biggest private bank in Brazil, was again chosen by the analyst and investor community as having the best IR program among large Brazilian companies. Excellence, proactivity and value creation are the keys to the bank’s success in the capital markets.

‘We have good structure in the IR department and staff qualified to meet individual and institutional investors, as well as analysts,’ says executive vice president of IR Alfredo Setubal. There are about 30 people handling IR at the bank, which deals with around 3,000 institutions.


Left to right: Rogério Calderon, Itaú Unibanco; Candice Teruszkin, head of DR business development for Latin America at JPMorgan; Geraldo Soares, Itaú Unibanco

Randon
Randon, a manufacturer of trailers, semi-trailers and rail cars, is not among the largest companies on the Bovespa by market cap, but when it comes to investor relations excellence, it’s very highly placed. ‘In all honesty, Randon deserves this award because our IR department has the same high quality as any of the blue chips,’ said CFO Geraldo Santa Catharina when collecting the grand prix for best overall IR in the small and mid-cap category. ‘We are very happy with this work, which is supported by top management.’

Astor Milton Schmitt, director of investor relations, also feels Randon is taking the right approach. ‘We try to facilitate analysts,’ he explains. ‘We have excellent governance practices and our results have been very satisfactory, with average annual growth of 17 percent over the past 15 years.’


Hemerson Fernando de Souza, IR executive at Randon (left) and Pedro Arlant, country manager for Brazil at Capital IQ

Vale
At Vale, IR is a strategic role within the growth process of the company. This role is underlined on the company website: ‘Ethics, transparency and respect are the foundation of our relationship with investors.’ After all, this multinational giant – the second-largest diversified mining company in the world – has half a million shareholders around the globe.

‘These awards are the result of teamwork and the pursuit of continuous improvement that we promote in the IR area,’ said Roberto Castello Branco, Vale’s IR director, at the event. ‘We’re delighted with the award, but never satisfied: our goal is always to improve.’

One of the highlights of the year was listing on the Hong Kong Stock Exchange in December 2010, making Vale the first major company in the Americas to do so. According to Castello Branco, the firm is looking to expand its shareholder base in Asia.

Localiza
For the second consecutive year, Silvio Guerra, IR director of Localiza Rent a Car – the largest vehicle rental company in Latin America – was voted best IRO in the large-cap company category. ‘This recognition brings a necessary counterpart, which is an obligation to continue to improve and pursue global best practice in IR,’ says Guerra, who left the mining and energy sector to join Localiza. In his 16 years at the company, he has made it clear his main goal in IR is to create communication that generates value.

Drogasil
For the past four years, informing the market in a transparent and proactive manner, the IRO of Drogasil, Roberto Listik, has set the standard. Occupying a little-known economic sector for investors and analysts – retail pharmacy – Drogasil has had to reinvent how to communicate with investment professionals.

‘I see this award as recognition for these four years’ effort to teach the market about the Brazilian retail pharmacy sector. We had a pioneering role in this,’ said Listik, while collecting his award for best IRO in the small and mid-cap category. The firm was the first retail pharmacy to join the Novo Mercado segment of Bovespa. ‘It fell to Drogasil to inform the market about the industry and its peculiarities. The fact that we are where we are today is a sign that we did a good job,’ Listik added.

Natura
One of the most sustainable corporations in the world, Natura is constantly seeking new ways to strengthen its grasp on environmental issues. Advances include new programs aimed at improving supply chain measures, in which IR has the support of the board. Given this policy, so central to the firm, it is easy to see why Natura, for the fifth consecutive year, was honored with the award for best corporate sustainability.

‘There is no doubt that there is a constant evolution of new structures, plans and CSR evaluation, which has attracted much outside interest,’ explains Helmut Bossert, IR general manager at Natura. The company was the first Brazilian firm to be ranked in the Global Reporters Program, an initiative from the Brazilian Foundation for Sustainable Development. The program lists 50 companies, which, through their annual reports, better inform the public about their economic, social and environmental policies.

Lojas Renner
The first Brazilian company to have 100 percent of its shares traded in Brazil, Lojas Renner has garnered awards for its corporate governance practices and track record in pioneering expansion. Governance practices at Renner meet all the standards of Bovespa’s Novo Mercado, which imposes the highest level of governance standards in the Brazilian capital markets.

The company’s board of directors – comprising seven members, five of whom are independent – is the body responsible for policy formulation and implementation of overall business practices, including the firm’s long-term strategy.


José Galló, Lojas Renner’s CEO, accepts the award for best corporate governance

Arezzo
Assertiveness and speed of response to the demands of investors combined with a search for high-quality standards in all operations led to Arezzo, a leader in the Brazilian women’s footwear and accessories sector, winning this year’s best IPO award. The company held the first of Brazil’s IPOs in 2011, raising R$565.8 mn ($362 mn), according to data registered at CVM, the Brazilian securities commission; funding was expected to reach just R$420 mn.

Pão de Açúcar – CBD
Pão de Açúcar – CBD, a leading retailer with 17.9 percent market share and sales of R$36.1 bn in 2010, this year took home two awards: best investment community meetings and most progress in IR, both in the large-cap category. The awards recognized practices that began to be adopted in the last year, with the appointment of Vitor Fagá de Almeida as head of the group’s IR department.

‘The award for most progress was in recognition of the important work being done, and it encourages this work to continue,’ said de Almeida. It was the company’s efforts to be more open that made the difference when it came to winning the award, which began with a survey of sell-side analysts and a search for better corporate governance practices, which in turn led to changes that demanded better IR.

Kroton
Kroton Group, one of the largest organizations in the education sector in Brazil, won the award for most progress in IR in the small and mid-cap category in recognition of its efforts to steadily strengthen its relationship with the financial community. This work began in 2009 with input from private equity fund Advent, followed by the hiring of a new board. The new arrivals included Rodrigo Calvo Galindo, current CEO, and Carlos Lazar, an IRO with more than 10 years’ experience in business and IR consultancy.

Marcopolo
The close relationship with investors and analysts is one of the strategic activities of Marcopolo’s IR division. The firm hosts an annual ‘Marcopolo Day’ so investors and analysts can see its plants and facilities. In June this year the event was held in conjunction with Randon and was so successful the company had to limit visits to 46 investors.

‘At this event, we have a company presentation, organized visits to the assembly lines and a tour of the test tracks. It is still an attraction for those who also want to see the Serra Gaúcha,’ says IR director Carlos Zignani. For him, the fact that investors see the manufacturing process of a bus from assembly to final product means the company provides enough visibility. And the investors all leave impressed.

Petrobras and Eternit
Respect for individual investors, speed of information policy and loyalty to shareholders are all part of companies’ good IR practices, irrespective of their size or market segment. Actions specifically targeted at the individual investor audience took two firms – oil giant Petrobras and Eternit, one of the oldest companies listed on the Brazilian stock market – to the winners’ podium to collect awards for best IR for individual investors. Almir Guilherme Barbassa, CFO and IRO of Petrobras, believes the award is an important recognition for the IR team of the whole company, whose shareholder base exceeds 700,000 individual investors.

For Rodrigo Luz, IR manager of Eternit, the award is a response to the company’s transparent approach. ‘It is proof of seriousness, responsibility and, above all, transparency in our relationships with investors, and confirms the good corporate governance practices of the company,’ he says.

About 60 percent of Eternit’s shares are held by individual investors, including those sitting on the board. The IR policy appears to have worked: in 2004 there were approximately 1,300 shareholders; today, that number is close to 7,000.

To order copies of the Investor Perception Study, Brazil 2011, please contact Brigitte Toledano at +1 212 430 6861 or email [email protected].  

Ronnie Nogueira is publisher of Revista RI, Brazil’s IR magazine.



This article appeared in the September print edition of IR magazine.