The Unique Context of Emerging African Markets
The pursuit of developing effective online investor relations practices in emerging African markets paints a vivid picture of the unique challenges public companies in these regions face when navigating the realm of communications governance. Based on my extensive experience, I’ve put together the following observations and guidelines, aiming to provide a roadmap for these companies to gain tangible value from their listings on the stock exchange.
Tailoring Investor Relations Standards to African Markets
The guidelines I propose, referred to as the Minimum Standards of Online Investor Relations, are uniquely tailored to fit the context of these relatively illiquid, inefficient markets. They consider each company’s investor relations function within the specific context of its operations.
Size Doesn’t Diminish Necessity
It’s undeniable that the size and liquidity of African markets are significantly smaller when compared to the broader international arena. However, this doesn’t diminish the necessity of investor relations within our markets. The status quo isn’t an option – we need to adopt strategies tailored to each company’s unique circumstances to make progress.
The Value of Building a Digital Community
The optimal strategy, one that presents the greatest potential benefits, involves treating all investors, including retail investors, as integral members of a company’s digital community. This should also extend to customers and stakeholders who feel they’re part of the company’s digital sphere.
Upholding Universal Legal Obligations
Despite regional differences, it’s crucial to remember that legal obligations to shareholders remain constant, whether they are based in Africa, Europe, or the USA. I’ve segmented the standards according to the anticipated uptake by small, medium, or large capitalisation listed companies, with each standard applicable to all segments given its self-explanatory nature.
Budgeting for Online Investor Relations
Addressing the cost aspect is imperative. Convincing decision-makers to allocate a budget for online investor relations shouldn’t be an uphill battle. With innovations and technological advancements readily accessible at relatively low costs, the leap from traditional high-cost print media should be more manageable.
Unravelling the Complexities and Anticipating Returns
The real cost challenge in online investor relations lies within the complexity of integrating various communication and data elements into a seamlessly functioning entity. The return on investment (ROI) of online investor relations becomes even more attractive when we consider the diverse benefits it offers.
The Benefits of Effective Online Investor Relations
Upholding ethical standards, enhancing the credibility of a company’s website, attracting regular website visitors, offering immediate news and content dissemination, gaining a competitive edge, providing information relevant to corporate actions, expanding the digital community, identifying otherwise unreachable investors, retargeting website visitors with advertisements, repurposing annual report content, using investor relations as a reputation risk management tool – these are all benefits that online investor relations bring to the table.
Is Online Investor Relations Worth the Effort?
Presented in this light, the question becomes: Are there valid reasons for a company not to have an online investor relations presence? There’s one noteworthy caveat: if the data and information provided are incomplete, outdated, inconsistently published, or incorrect, and no alternatives exist, it’s not worth the effort.
The Potential of Online Investor Relations in Emerging Markets
Properly implemented, however, online investor relations can be a game-changer for companies in emerging markets, ensuring they maximize their stock exchange listings’ potential.