A look ahead to the key strategic trends and opportunities expected to drive the Issuer and Investor Relations industry through 2023 and beyond.

Introduction  

Michael Miller, Executive Director, Issuer Solutions 

Global stock markets are down, fears of recession are on the rise, and many other macro challenges are facing issuers. As a result, Investor Relations (IR) teams are managing through uncertainty on several fronts as they plan for 2023. In many cases, significant pressure from institutional selling and stock price volatility have driven a shake-up in top shareholder lists. As a result, many teams recognize a need to re-visit targeting efforts in a meaningful way.  

While budgets for headcount and travel are being reduced, IR teams are being asked to do more than ever. As a result, teams are looking for ways to optimize investor interactions and to balance in-person, virtual and hybrid interactions in a post-pandemic world. All global issuers are focused on ensuring that they have a robust ESG story to tell and that they can reach the right investors with that story. Finally, some corporates are concerned about the potential for shareholder activism given the recent downturns in their stock price and less rosy near-term outlook.  

These challenges and more are on the minds of IR teams as they look out toward next year. 

The Take 

Institutional selling is expected to continue to be a headwind for stocks as long as recessionary and inflationary fears remain top of mind for investors. Therefore, IR teams will need to double down on their investor engagement efforts. Competition for capital in 2023 will be fierce, so these teams will need to be strategic about their targeting efforts, ensuring that they are updating models for new guidance metrics as well as for their updated shareholder lists.

In addition, IR teams should ensure that they are maximizing return on their time and limited resources by balancing in-person and hybrid events, including NDRs, conferences and other small group and 1-on-1 meetings. Many should consider hosting a hybrid Investor Day, which will enable them to meet with investors in-person and virtually and to update their strategic outlook, discuss business performance in the current challenging environment.

Best-in-class IR teams will have a robust and up to date ESG strategy. In addition to understanding what investors are expecting from them in the future, these IR teams will benchmark their efforts against others and ensure that they are meeting with the right investors and measuring their efforts effectively. 

For IR teams with potential activists building a position in their stocks (or for those who suspect this might be an issue in the future), there is a need to monitor ownership closely, communicate effectively, and ensure they have a strategy in place to deal with activists.   

As IR teams plan for 2023, there are many steps to be taken. The key to success is to have a robust plan in place, to execute against that plan, and to measure the effectiveness of investor outreach and all other IR efforts.