We are all familiar with PR (Public Relations) departments in companies. Most companies, big or small have these departments to ensure that the public perception about a company or product or brand is positive. Along these same lines, many medium and large scale companies or businesses have investor relations (IR) departments

1. How Investor Relations Can Make
A Difference
We are all familiar with PR (Public Relations) departments in companies. Most companies,
big or small have these departments to ensure that the public perception about a company
or product or brand is positive. Along these same lines, many medium and large scale
companies or businesses have investor relations (IR) departments. These can be defined as
“a department that provides investors with an accurate account of the company’s affairs
based on which investors can make informed buy or sell decisions.” For any company which
depends on investor generated funding for capital and operations, such a department can be
of great significance. The department also functions as a bridge that provides market
intelligence to the corporate management and thus ensures that the core management team
is also aware of the financial market situation.

2. Once you have understood the primary function of this department, it is easy to see why it
can make a big difference to any company. It is not only the prospective customers who will
be the end users of your brand or product that need to be kept satisfied but also the
investors who have put in their stakes on the company. Those who have invested money are
bound to be worried about the return on investment and also the safety of their investment.
An IR department ensures that regular information about the current activities of the
company reaches investors. When there is a regular flow of information, investors are bound
to be less apprehensive of the fate of their investments!
Investor relations is not only a vital department in companies that is tasked with handling
information flow to the shareholders and investors of a company but it can also be perceived
as strategic management responsibility that is responsible for the integration of finance,
marketing, communication and also securities law compliance. This ultimately ensures
effective two way communication between a company and the financial community. Many of
the larger companies also have IR officers (IROs) who report directly to the Chief Financial
Officer or Treasurer of the company. IROs oversee all the key aspects shareholder
meetings, one on one meetings with investors, press conferences, investor related sections
of company websites, annual reports and so on. This is why these departments are also
known as “financial public relations” departments.
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