Companies lose appetite for peer evaluation in IR measurement
Investor feedback is the most popular form of IR measurement, according to research by IR Magazine, cited by 25 percent of respondents to an open-ended question set in February this year.
After investor feedback, four other IR measurement metrics are mentioned by at least 10 percent of IROs globally: shareholder composition (15 percent), investor meetings (12 percent), analyst coverage (10 percent) and share price (10 percent).
When IR Magazine asked this question in 2012, a sixth metric was also named by at least 10 percent of respondents: four years ago, 12 percent of companies used peer benchmarking when measuring the effectiveness of their IR program. Today that figure has more than halved to 5 percent.
Despite the shift away from peer benchmarking, a number of companies still see it as an essential element in their IR measurement – including perennial IR Magazine Award-winner BASF.
Talking to IR Magazine ahead of her move from head of IR at the German chemicals giant to OMV in May 2016, Magdalena Moll described peer benchmarking as ‘pretty crucial’. BASF hires an external agency to conduct a global perception study, involving interviews with the buy side and sell side every year, as well as setting targets for the number of meetings that need to be held.
The full findings can be found in an upcoming research report looking at trends in measuring and demonstrating the effectiveness of investor relations, the first of a three-part series.