Market Monitoring - 02/07/2020

Metrics that help measure the effectiveness of the IR program

Measuring the efforts carried out by IR professionals has never been an easy task since data is rarely integrated. By analyzing share prices alone, we ignore issues that go beyond the work carried out by IR, thus compromising the result of the assessment. Additionally, the number of meetings or conferences held in the period does not necessarily imply they were effective. The challenge for Investor Relations Officers is to gain exposure to C-Level and Board executives in order to present the efforts carried out by the IR team aimed at:

(i) reducing cost of capital;

(ii) generating value by raising the ratio between share price upside and financial multiples (always in relation to the company’s peers);

(iii) managing the company’s shareholder based in such a way that it is in line with the company’s current investment strategy and thesis;

(iv) mastering relationship with analysts to reduce dispersion between estimates;

(v) measuring the conversion rate of prospect investors into actual shareholders as a result of meetings and conferences, thus improving the use of management’s time;

(vi) receiving feedback from the market on its perception regarding the company’s positioning and strategy against its peers and/or comparable players;

(vii) monitoring the company’s compliance with regulatory bodies;

(viii) articulating the company’s value proposition: create an investment thesis based on premises and facts that clearly expose the company’s strategic choices and how it effectively creates value through consistent and sustainable growth.