Category: Investor Relations

Playing by the Rules

Privately held companies can call their own shots and only have to share their financials with the tax man. Once you go public, the game changes. Suddenly, the rules and regulations kick in to overdrive. You are now responsible to your myriad and ever-changing group of investors. In 2002, when the Sarbanes-Oxley Act was enacted in the United States (which served as a template for changes in Canada as well), publicly traded companies were handed a whole new rulebook that they had to play by or face some time in the penalty box (fines and/or jail time).

One of the key components of investor relations is a company’s annual report. Once a large expense and a drain on natural resources, they have now begun to enter the digital era. By sharing an online version of the annual report, businesses can save the cost of printing and delivering the reports which also saves on paper and pollution. The other online advantage is the incorporation of video and the ability to be more interactive. It is also easier for potential investors or employees to look back over the company’s performance and get an idea of how they have (hopefully) grown and progressed.

While the primary function of the annual report is to reveal the financial performance over the year, it can also be a useful vehicle to reinforce their brand, expand on their vision and to give a glimpse into their future. The biggest challenge with an annual report is making it in depth and sophisticated enough for a savvy investor, yet engaging and clear enough for other audiences.

The online annual reports are still based on the concept and style of the published reports. Once more companies can get away from the restrictions of a paper world, we will see the growth of interactive and dynamic websites that can offer each viewer an engaging experience that gives them a simple video overview or access to all the numbers their hearts’ desire. Stripping away the bonds of a static report and opening ourselves to the possibilities of the digital world will take investor relations to the next level.

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Spread the Word

Since before the written word, people have  handed down advice and warnings in stories. This oral tradition featured heros and villains, triumph and failure. Stories stick in our minds. Facts and figures can fall out of our memory while stories stay. The beginning: there was a need, the middle: there was a new solution to meet the need, the end: the new solution successfully met the need. The first story any company or organization needs to tell is the tale of their origin.

The publics need to know the why. Why did you start what you are doing? How did you perceive the need? Why did you think you could take on this challenge? How are you different from all who’ve come before you? Stories get repeated and shared. With the new ease of “like” or “share” on Facebook, or “retweet” on Twitter, or “reblog” on Tumblr, a story can go viral in the time it takes to find an article in a magazine that is touted on the cover.

While companies can offer almost identical products or services, it is the story that sets them apart. Was the company started in a garage or a kitchen table? Is it a family business going back generations? This is where the story begins. We all know that Starbucks started with it’s original location in Seattle’s Pike Place Market in the 70’s. Facebook was created by a Harvard student before he dropped out. We see Colonel Sanders and think Kentucky Fried Chicken, how many secret herbs and spices do they use?

Stories are shaped from facts and values, they give consumers something to relate to and help categorize. Are you the underdog? The maverick? Before people know how to look at you, you have to see yourself. If you want people to buy, first they have to buy in. Don’t throw them a pitch, tell them a story.