The CEO and CFO are, in principle, jointly responsible for determining the IR strategy of the company.
Depending on the size of the company, the IR team can comprise only the CEO and CFO up to dedicated departments headed up by the Investor Relations Officers (IRO) with a title such as Vice President IR (or any relating title).
Executive Board commitment
Senior bodies involved in formal disclosure policies include the Executive Board, specifically the CEO with respect to strategic development and the CFO with respect to the financial development, as well as the legal counsel. They are all involved in drafting formal disclosures, such as quarterly results publications, AGM preparation and materials, and announcements regarding changes in the (SB) Board or Executive Board.
The Executive Board needs to ensure that the IRO is involved in the strategic decision-making process, approves the IR strategy and programme and monitors it on a regular basis. An effective IR programme requires involvement and time of the Management Board, including time for preparation, road shows and presentations. It is advised that the IRO makes efficient use of management’s time for two reasons:
- not to waste management time; and
- not to create the impression externally that management has ample time to spare.
Facilitating IR at Executive Board level
In order to make efficient use of the Board in IR activities, it is important for the IRO to organise meetings:
- well in advance, as management’s calendars fill up soon;
- for new, potential investors, taking into account that they can possibly first meet with the IRO only;
- whilst contemplating whether to postpone a road show in case a broker would not be able to plan enough meetings for that road show;
- for which management is prepared well in advance, and know who they are going to meet, including maybe critical investors and assess if do they have an axe to grind etc.;
- ensuring that management always gets a feedback report from a road show.
Role of Supervisory Board (SB) or the Board
The members of the SB or of the one-tier Board are not involved in the day-to-day execution of the IR programme; i.e. they are not in contact with the investors in the company. In most cases they will be informed by the Executive Board with respect to the sentiment in the market regarding the company. In some cases, the IRO will have direct contact with the Chairman of the SB. In addition, in some instances it has been known that the Chairman of the SB has been in contact with large shareholders.