Highlights from the IR Magazine Midwest Think Tank

Uncertainty hung in the air as more than 60 top IROs and financial market professionals gathered at the IR Magazine Midwest Think Tank in Chicago in November.

The markets were still digesting leadership changes in Italy and Greece, while questions about the future of the EU continued to swirl and the Congressional super committee grappling with the US deficit was scrabbling for solutions.

Seasoned IR pros know how to compartmentalize, however, so the think tank got down to business for a full day of debate, idea sharing, best practice and problem solving on emerging issues confronting IROs today.

Managing your web presence

A session entitled ‘Maximizing your web presence: getting the message out and tracking sentiment’ sparked a lively discussion about social media.

While a common refrain emerged – ‘You’d better know what’s being messaged about you in the blogosphere’ – participants were split between simply monitoring the web  and actively managing the IR message via social media.

Several participants have claimed their ticker symbol on StockTwits and use the site to tweet key messages during earnings conference calls.

‘If you’re not tweeting your stock, someone else is,’ observed one participant.

But another IRO threw out a challenge: how can you tweet non-GAAP numbers and a full reconciliation in 144 characters? It can’t be done, he asserted, lamenting that the lawyers would never allow tweeting during a conference call for that very reason.

Another participant countered, saying he’d calculated that a disclaimer statement would take only 19 characters and attaching a link to a full reconciliation would answer most ‘reasonable’ lawyers’ reservations.

Embedding hyperlinks in your press release was suggested as an easy, no-cost way to make your website the central focal point for investors.

Hyperlinks should take investors to specific pages on your company website and specific parts of a relevant document, making your IR package seamless and easy for the buy side.

Reuse of material, including brief video interviews with your CEO, can be an effective way to reinforce key messages.

But one IRO cautioned against over-polishing the video to prevent it coming across as a marketing pitch rather than an on-point message from the CEO.

Tips for investor events

Think about providing transparency in your IR process as much as in details of your management presentations to maximize your investor meetings: that was the pitch of one investment professional in a panel titled ‘Tips for great investor events’.

Every experienced IRO knows content is king and you don’t want investors coming away from a  meeting thinking, ‘That was a waste of time.’

It’s important to set expectations ahead of  an event or meeting about what will and won’t be covered so investors aren’t surprised, he advised.

Navigating demands for management access, conference appearances and non-deal roadshows can be a thankless task.

If you can’t honor a request, let investors know your thought process so they know they’re being treated fairly.

Promising investors that you’ll do their conference every other year, or explaining why you can’t do their conference but will do a non-deal roadshow will go a long way to demonstrating that your IR program is being managed strategically while your CEO and CFO are focused on running the company.

Going global

The panel titled ‘Going global: targeting overseas investors’ provided a timely reminder, as the Euro debt crisis continued to unfold, that IROs need a 360-degree view of the markets in order to effectively tell their story.

‘You’re not competing against other transportation companies,’ one seasoned IRO observed.

‘You’re competing against other global equities – so you have to change the way you talk about your company.’

Another advised people to be nice to everyone. He noted a migration of some investor talent from Europe to the growing sovereign wealth funds in the Middle East.

These could be some of the same analysts or portfolio managers you already met at a different firm.

Previewing 2012

The final session, ‘Previewing 2012: from the national debt to the election and more’, focused on the intersection of politics and the economy. It provided a fitting coda to a day steeped in uncertainty.

Corporate campaign spending following the Supreme Court’s Citizens United decision will be under intense scrutiny from activist investors and the business press, warned think tank participants.

CEO egos and lack of transparency can create situations that can quickly spin off into a full-blown PR/IR crisis, inviting shareholder resolutions, boycott campaigns and  board involvement.

In an era of uncertainty, one thing remains constant: IROs have to expect the unexpected.

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IR Magazine Think Tanks are free, invitation-only events for select groups of senior-level IR professionals. Find out about upcoming think tanks at www.irmagazine.com/events.