Introduction: The Commercial Angle of Investor Relations
Investor relations might often be seen as a discipline existing in a silo, separate from the company’s other operations. But what if we took a leaf from Warren Buffet’s Berkshire Hathaway playbook? Standard 15 of the Minimum Voluntary Standards of Online Investor Relations proposes just that – harnessing the commercial potential of investor relations.
The Berkshire Hathaway Model: Merging Investor Relations with Commercial Strategy
Each year at Berkshire Hathaway’s AGM, tens of thousands of shareholders get more than just financial insights – they’re also treated to a showcase of Berkshire company merchandise. The convention center comes alive with products from See’s Candy, Brooks running shoes, custom Heinz ketchup bottles, and Fruit of the Loom underwear, offering a unique blend of investor relations and commercial promotion.
A Missed Opportunity: The Power of Retail Investors
In many markets, under-resourced digital investor relations programs fail to capitalise on opportunities to actively promote products and services to shareholders. This is a significant missed opportunity. A certain stigma seems to hang over retail investors, with some companies assuming shareholders will naturally engage with their products and services.
The Altruistic Nature of Brands Support: Earning ROI on Online IR Communications
The fact is, one of the biggest reasons brands garner digital support is because people want to “support the company.” There’s an altruistic trait in people that can be tapped into, provided they are not overly distracted by other digital media. By focusing on creating an online community and making a few tweaks to the digital channels and the content published on them, it’s possible to achieve a return on investment of more than 100% on online investor relations communications.
Conclusion: A Call to Leverage Investor Relations Commercially
Standard 15 challenges us to look beyond traditional investor relations. By actively integrating a commercial strategy into investor relations programs, companies can forge stronger relationships with their shareholders and, in doing so, unlock untapped commercial potential.
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THE MINIMUM VOLUNTARY STANDARDS OF
Online Investor Relations Practices
Building effective online investor relations in emerging African markets presents unique governance challenges for public companies. Our guidelines aim to help these companies leverage their stock exchange listings and overcome communication hurdles.
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