Reflections on a quarter-century of IR to mark IR Magazine's silver anniversary
IROs can be seen as information service providers. For me, the objective of every investor meeting is to ensure the analyst or fund manager leaves the meeting with a better understanding of the firm – its operations, growth drivers, strategies and competitive landscape. While this objective is relatively intuitive, being able to achieve it consistently requires lots of work behind the scenes.
As a former IRO, I remember the long hours, often after the close of business, catching up on trade magazines from various industries and relevant websites, keeping abreast of the concerns affecting investment decisions. Only with a clear depth of knowledge can IROs help analysts and fund managers gain a better understanding of the business. 
As much work as this sounds, it was actually the easy part of my quest for knowledge. At most Asian companies, the biggest challenge to knowledge acquisition is internal communications.
The investor relations function is often sidelined or even ignored at Asian firms. IR departments (if any) in Asia are typically manned by one to three people, with poorly defined authority for internal information flow. Worse, some firms still treat the IR function as essentially a PR role with the objective of improving company image rather than improving investor knowledge.
Many companies fail to see the IR function as a frontline operation. Consequently, IROs are sometimes not kept abreast of company developments. Your bosses, colleagues and directors need to be educated about the role you play. Your management has to understand why it needs to explain performance below market expectation despite growth.
Your finance department needs to understand that proper explanation and disclosure are required when there is significant variance in the numbers. Your operational managers need to keep you informed of significant operational developments within the company.
Could all these be formally structured? Certainly – but that’s not what usually happens, nor is it how strong internal relationships are formed. Most people will agree that inter-departmental relationships are never easy. I dealt with them using this approach: no one is out to give you a hard time when you request information. If that’s how it appears, it is a defensive mechanism born out of ignorance of your role.
Your colleagues have to understand the role you play and why you need certain information; this understanding cannot be created overnight. For me, every meet-up, every friendly lunch with colleagues is an opportunity to educate them about what I do – and why I need to do it.
Joseph Chia is general manager of the Investor Relations Professionals Association (Singapore) and former IR manager of ST Engineering.
