DIRK 2013: IROs as chief dissent officers

This year the 16th annual DIRK conference moved over from its usual spot at the Marriott to the Westin Grand Frankfurt. Following a video message from Magdalena Moll, DIRK president and head of IR at BASF, BNY Mellon president Karen Peetz span a ‘cautionary tale’ into her keynote speech.

Peetz compared a crisis at Penn State University, where she also sits on the board, with the global financial crisis, explaining how each situation highlighted one of the biggest challenges boardrooms – and IROs – have to grapple with today: trust.

‘Most of you here today represent enterprises that did not contribute in any financial way to the crisis, most of your companies have been untouched by the scandal, have given investors no reason to doubt or mistrust you,’ she told delegates on Monday. ‘All the same, all of you have been touched by these events; investors simply do not have the mindset that they had before September 2008. At the very least they come to the table with healthier skepticism.

‘It’s our shared challenge to restore that trust,’ she told the DIRK audience.

Talking about how exactly to restore that trust, Peetz said a move away from short-term thinking, diversity in the boardroom and aligned communications would all play their parts, but a change in leadership was also needed. ‘[If] the thought processes and leadership styles that contributed to the mess in the first place… don't change, won’t new issues just take root and cause similar or worse problems?’ she asked.

And this is where the role of the IRO can change, not just where investors put their money, but also the thinking at the top of the food chain, providing ‘critical leadership,’ Peetz said, adding: ‘Part of the reason you’ve enjoyed success as investor relations professionals is that you're skilled at providing the healthy dissent and injecting the voice of cynicism, or reason, at critical junctures. You are, in effect, the chief dissent officers’.

What followed Peetz’s keynote was a varied selection of workshops centered around DIRK’s conference motto: ‘Where to invest? Where to get funding? – The pivotal role of investor relations.’

Unfortunately for the small minority of non-German speaking delegates in a group of around 500 attendees, only one workshop each day was in English. However, a talk from Chris Collett, who holds the post of IR market development at Thomson Reuters, and James Fitzsimmons, managing director, global corporate access, at Goldman Sachs, on the Monday gave IROs plenty of takeaways. Covering the who, where and why of finding investors, they looked at who is investing where, the need for accurate shareholder identification and measuring the effectiveness of meetings, as well as touching on the very current issue of corporate access.

Tuesday offered up an intriguingly titled talk: ‘Just the tip of the iceberg! One court decision changes everything.’ Sponsored by Computershare, it covered the aftermath – and the future effects – of a Cologne higher regional court decision in July 2012, that led to a large number of investors abstaining from voting, due to concerns they might have trouble selling or transferring their shares.

Those with a more advanced German skill set obviously enjoyed many more talks, including ‘The analyst in the area of conflict between investors and corporate IR,’ ‘Coordination between the CFO and IR – dream team or royal children?’ and ‘More transparency for IR: changes in shareholder structure and growing significance of private shareholders’ on the Monday. Tuesday offered up ‘The rules of successful communication (and what not to do…),’ ‘IR’s influence on ratings’ and ‘The future of digital reporting,’ among others.

Not everyone was daunted by this year’s lack of simultaneous translation, though. Aided by an English presentation, the IR Society’s John Gollifer even joined in the Q&A at Ipreo’s German-language presentation on fixed income trends and best practice.

Closing the first night, of course, was the DIRK awards and flying buffet – the perfect networking (not to mention drinking, dancing and celebrating) opportunity for the cream of German IR.