When it comes to accessibility, Europe’s short-listed companies are not all leading by example
The European IR awards evening is fast approaching. There are 33 unique companies on the short list for the 16 pan-European awards, each of which will be presented at the ceremony at the London Hilton on Park Lane in London on June 30. A further 114 unique companies will compete for the 44 sector and country awards. In total, that makes 147 possible winners come Thursday next week.
Most of these companies feature in the Investor Perception Study, Europe, 2011, due for publication immediately after the awards. This is the study that identifies the winners and short-listed companies each year. It is compiled on the basis of around 750 calls with investors and analysts, and includes profiles of the leading CEOs, CFOs and IROs in the European IR community.
This year, the report will launch the inaugural Euro Top 100: a new annual league table of the leading companies in the region, ranked in order of their overall scores in the survey.
But what have we learned after all that?
If nothing else, it is safe to say that we have become intimately familiar – even more so than usual – with the investor relations pages on each of these companies’ websites. We have spent weeks researching the team names, job titles and contact details for the shining lights in European IR. Sometimes companies can be surprisingly helpful. Often they are dismally closed shops. In some cases, the worst offenders provide only a generic email contact form. Not much of a relationship being encouraged there.
Ok, so a certain amount of caginess is understandable. After all, what IRO wants to be called on a regular basis by an IR service provider, a recruitment consultant or – heaven forbid – a journalist angling for an interview? A spam-filled email inbox can be even more of a nuisance.
At the same time, however, a company being accessible to investors and offering them different ways to stay connected is surely a rudimentary building block of IR best practice. The CEO, the CFO and the rest of senior management can be excused for keeping hold of their email addresses. Their primary job specification is not to be in regular communication with the markets. IROs, on the other hand, should be reachable.
What’s on your vcard?
With all that in mind, XbInsight revisited the corporate websites of the 33 unique companies short-listed for a pan-European award in the 2011 awards. For each, we checked the contacts section on the investor relations page to see what kind of information is readily available.
Straightaway we found that full transparency co-exists on the short list alongside reluctance to open up. For every generic phone number there are the companies that offer investors multiple ways to get in touch.
So in order to evaluate the companies’ ‘accessibility’ in a fair and open way, we have identified five categories of data (phone numbers, email addresses, IR team breakdown, team photographs and personal social media pages) and scored each of the 33 companies according to the completeness of the information provided.
The maximum score is an ever-so-traditional 10 out of 10.
Three companies share the highest score. On nine points, one short of the maximum, are Novo Nordisk of Denmark, Sligro Food Group of the Netherlands and Umicore of Belgium.
Novo Nordisk provides a personal e-mail address, mobile phone number, landline number and photograph for each member of its IR team. ‘It’s a nice way to ensure our investors know how to get hold of us,’ says Klaus Bülow Davidsen, head of investor relations at the pharmaceuticals company. Novo Nordisk is short-listed for five pan-European awards.
‘By adding pictures we make our contact details more personal and by adding our mobile numbers we want to show the analyst and investor community that we are easy to reach,’ says Evelien Goovaerts, investor relations manager at Umicore.
‘Our investors appreciate this approach. For those who might not have met us yet, it’s always nice to have a picture next to the name.’ Umicore is short-listed for three pan-European awards this year.
Phone, photos and email
Just under half of the companies (16 of the 33) provide photographs of their IR teams. Of the remaining 17, five don’t even provide the names of the IR team members.
When it comes to phone contacts, 21 companies supply direct-dial landline numbers, three give mobile numbers, seven list only a generic IR number and two companies don’t provide any phone number for IR at all.
Of the 33 companies we found 10 that provide only a generic address, two that don’t provide any email contact, five offering only a form, and 16 supplying personal email addresses.
It’s all about trust
DSM, K+S, Stora Enso, Konecranes, Coloplast, RWE and Lanxess are among the other high scorers, with eight points each.
‘This is a people business, meaning simply that human beings typically would like to know who they are talking to,’ says Oliver Stratmann, head of investor relations at Lanxess. The German chemicals group is short-listed for four pan-European awards this year, including the mid-cap grand prix and best IRO categories.
It’s all about trust, according to Christian Herrmann, head of investor relations at fertilizer supplier K+S. ‘Trust is what we want to achieve and therefore, individual contact information, including a photo, helps to reduce the hurdle to call us,' he explains. 'By contrast, a generic and anonymous IR email address does not serve the purpose to build up a personal relationship.’
Large cap vs small-cap
A total of 10 companies scored fewer than six points, including Allianz, UBS, Unilever, AstraZeneca, William Hill, Kerry Group and Christian Hansen. Immediately this shows that market capitalization is no indication of an IR team’s accessibility; large-cap, mid-cap and small-cap companies all feature in the above list.
For instance, AstraZeneca is one of two companies that scored only one point. The UK-based pharmaceuticals giant provides only a generic phone number for its IR department.
‘We’ve had positive feedback from analysts and investors on the ‘availability’ of the IR team,’ says Nicklas Westerholm, director of investor relations at AstraZeneca. ‘That said, we are always open for ways to offer a better service. Hence we will review the content and information on the AstraZeneca IR website to look at further improvements.’
The other company scoring just one point in this test is Christian Hansen of Denmark, but the producer of food cultures, probiotics and enzymes for the food industry, short-listed for best IR during an IPO, may consider it an achievement to be alongside corporate royalty like AstraZeneca, a stalwart of the capital markets. At the beginning of June, the Danish company celebrated its first year as a listed company on NASDAQ OMX Copenhagen.
The bottom-ranked company in this mini-survey is Great Portland Estates, which scored zero points. The London-centric real estate company is short-listed for two pan-European awards this year – the grand prix and best IR by CEO prizes in the small-cap category. The explanation for this anomaly is simple: the company does not have an IR department. The IR function is covered by the CEO and the CFO – and therefore the website has only a few lines dedicated to investors.
Social media links are still to come
None of the 33 companies publishes links to the IR team members’ social media accounts. Otherwise Novo Nordisk, Sligro Food Group and Umicore would have scored full marks. The criterion is included in our research only because this high standard of availability is being set by other companies in this year’s European investor perception study.
Deutsche Euroshop of Germany is short-listed for the best in sector award, alongside fellow real estate companies Unibail-Rodamco of France, and Great Portland Estates and Land Securities of the UK. On its website it includes up to five social media links for both members of its two-man IR department, as well as mobile phone numbers and direct email addresses.
‘We decided to publish our personal social media pages because we were already connected to many of our business contacts via these platforms,’ explains Patrick Kiss, head of investor relations at Deutsche Euroshop. ‘Additionally we think this is exactly what ‘relations’ are based on: personal opinions, the personality, daily things, and so on.
‘Investors and analysts especially like the vCard download possibility, because it’s just so comfortable for new contacts. We are regularly contacted by investment professionals via LinkedIn (and the German version, called Xing), Facebook and Twitter. Skype lags behind, but we have already arranged two meetings via the chat function (not the call function).’
XbInsight spoke to Kiss on the day after the Deutsche Euroshop AGM. As evidence of the established importance of social media in IR, he said, ‘Yesterday at our AGM, the first question from the representative of Germany’s biggest shareholders’ association was about our activities on social media.’ No problem for the management of Deutsche Euroshop, not least because its IR head is a prominent member of the IR Twittersphere.
But even for an early adopter like Kiss, the decision to make his personal details readily available was not easy. Blending the distinction between work and play can be tricky.
Ultimately, however, social media are about sharing information and Kiss does not regret his decision. ‘Honestly, the decision to publish the direct email address and cell phone number was as difficult as the decision to publish the personal social media pages,' he says. 'Both decisions seem to be right and we have seen no misuse so far. We are just a little more accessible.’
