taking it to heart...including hong kong, and 41% from southeast asia. the four market cap size...

Taking itto heartExploring how investorrelations is organizedin companies pre andpost IPO

2 | Taking it to heart: exploring how investor relations is organized in companies pre and post IPO

This report is the product of a study conducted for EY by IRInsights, the research and intelligence unit of IR Magazine.As many as 876 IR professionals from around the worldparticipated in the online survey that was conducted inQ2 2015.

Respondents were asked a series of questions relating tothe structure of their IR function, their formal and informalrelationships with both the board and other departments, andwhat aspects are important to the practice and assessmentof investor relations. Each section of this report details our

according to company region and market capitalization. Thethree key regions we use for comparison are the Americas with76% of the answers coming from the US, EMEIA* with 73%

including Hong Kong, and 41% from Southeast Asia. The fourmarket cap size brackets are small cap, mid-cap, large cap andmega-cap:

Small cap <US$1b

Mid-cap US$1b-US$5b

Large cap US$5b-US$30b

Mega-cap >US$30b

Respondent data and methodology

Respondent base split by market capitalization

Respondent base split by industry sector

Smallcap22%

Mid-cap28%

Largecap33%

Mega -cap17%

0% 5% 10% 15% 20% 25%

FinancialsIndustrials

Energy and powerHigh technology

Consumer products and servicesHealth care

MaterialsAutomotive and transportation

TelecommunicationsReal estate

RetailMedia and entertainment

Respondent base split by geographical area

Americas46%

EMEIA42%

Asia-

8%No answer

4%

Contents

1. What is IR’s role in your company?

2. What do you think determines IR success?

3. How important is IR’s seat at the top table?

4. Do you have written strategies, manuals and IR audits?

5. How well connected is your IR function?

4

5

6

10

12

www.irmagazine.com

*Europe, the Middle East, India and Africa

Investor relations (IR) has been in existence for over halfa century. For organizations in some regions, it is a well-established function. In other regions, however, it is less mature.Nonetheless, IR is as indispensable for companies preparing foran IPO as it is for listed companies.

•communication to regulators, investors and analysts iscritical. This would often involve introducing new roles,processes, infrastructure and systems around the IRfunction. EY has developed tools and frameworks to helpcompanies that are considering an IPO with the aim ofraising capital to grow. The EY 7 Drivers of Growth, forexample, is a framework of key business drivers companiesmust address to achieve their growth ambitions and thinkbroadly about their growth capabilities.

• A listed company, on the other hand, may need to improveits IR function to support the low cost of capital and ahigher share liquidity in relation to its peer group, and also

Earlier this year, EY, with IR Insights, surveyed 876 IRprofessionals from around the world to get to the heart of IR.We asked them questions relating to the organization and structureof their IR functions, their relationship with the board and withother internal departments, and what aspects are important tothe IR practice and for the assessment of investor relations.

Their responses give us insight into how listed companiesaround the world organize their IR functions internally, thetypical role of IR, its tasks and responsibilities, IR strategy,manuals and audit, and IR’s relationship with the board and withother departments in the organization.

Here is a summary of the inferences we made on the basis ofthe survey responses:

1. Need for strong relationships: IR’s ability to build strongrelationships with investors, and analysts, and the strengthof the executive team, are factors considered most criticalto the success of IR globally.

2. A seat at the top table: IR has a seat at the top table. It playsthe role of a two-way communicator by acting as the voice ofthe company to the investment community and as the voiceof the investment community to the management and board.

Executive summary3. IR strategy and IR manual: a written IR strategy and

manual support better preparing for an IPO and helpensure regulatory compliance post IPO. They cover investortargeting activities and the processes, infrastructures andresponsibilities to support departments.

4.IR departments in companies of all sizes considerinterdepartmental connectivity to be vital to the goodorganization of the IR practice. Of highest importance

department and with the planning, budgeting andforecasting department.

5. The size factor: the way IR is internally organized dependson the size of the company. The organization of IR is also

they are organized according to regional IR ecosystems,capital market trends, investor activity levels and peergroup best practices.

IR functions. We would be happy to share further informationand insight on request with companies preparing to list and alsowith those already established on the public markets.


contribution the IR department makes to a company. Many of theIR professionals we surveyed responded by offering descriptions

into three.

Response 1: Enabling two-waycommunicationSome respondents focused on the two-way nature of the IR’srole, as in these examples:

• IR acts as the voice of the company to the investmentcommunity. It also acts as the voice of the investmentcommunity to the management and board of directors.

• IR ensures that the management is aware of investorconcerns. It also ensures these concerns are addressedquickly and accurately.

• IR ensures that management knows how analysts and

and tailors the messaging accordingly.

• IR helps establish a corporate-wide understanding ofinvestor and shareholder concerns and how each colleaguecan affect the conversation.

•strategy, M&A, messaging and street feedback. While IRis not the decision-maker on many of these aspects, it

candid feedback from the shareholder’s point of view andsuggestions on overall strategy.

Response 2: Managing themanagementFor others, IR’s key contribution is to help manage seniormanagement’s time and to keep them accessible to investors

said, was the department’s key contribution to the company.

another. References to the effective use of management timewere plentiful, as were comments about “reducing the burden

management and show them in the best light.

According to this category of respondents, IR’s keyresponsibilities include:

• Attracting new long-term supportive shareholders andremoving much of the burden of IR from the shoulders of

• Acting as a bridge between investors and seniormanagement and giving valuable feedback to seniormanagement

•

being proactive with investors and analysts

goalsFor the third set of respondents, the IR contribution is all about

analyst coverage. This set of respondents took a broaderapproach, explaining that the IR input involved “diversifying theinvestor base with increased focus on long-only institutionalinvestors, explaining the rationale behind transformationalacquisitions, and managing the information needs of a growing

1. What is IR’s role in your company?

Although IR is not the decision-maker on strategy,M&A, messaging or responding to street feedback,it does provide the C-suite with the requiredinformation, candid feedback from the shareholder’spoint of view and suggestions on overall strategy.

Taking it to heart: exploring how investor relations is organized in companies pre and post IPO | 5

IR practitioners were asked to pick the three factors theyconsidered most critical to the success of the IR function fromthe following:

• IR’s ability to build strong relationships with investors andanalysts

• Strength of the executive team

•

•

• The company’s ability to prepare timely, accurate forecasts

• IR assisting in driving valuation

relationships with investors and analysts as a most critical factor.Strength of the executive team came next, with over two-thirdsof the respondents choosing this as a most critical factor.

their top three, the lowest of any of the six. This reinforces otherresearch indicating that driving valuation is not deemed to be acentral function of IR.

When the data is broken down by region and cap size, notabledifferences include more mentions for strength of the executiveteam in the Americas and more for IR assisting in driving

while, in terms of company size, it becomes more important asmarket cap increases.

However the data is broken down, the top two factors remain thesame: IR’s ability to build strong relationships with investors andanalysts, and the strength of the executive team.

Unsurprisingly, building relationships with investors is themost important factor to investor relations practitioners

88%

68%

45%

33%

29%

20%

’s ab l ty to bu ld stron relat onsh psw th n estors and analysts

tren th of the execut e team

ha n a "seat at the table"

nance’s ab l ty to produce t melyaccurate nanc al reports

The company's ab l ty to prepare t melyaccurate forecasts

ass st n n dr n aluat on

IR’s ability to buildstrong relationships withinvestors and analysts,and the strength of theexecutive team, werechosen as factors criticalto the success of the IRfunction.

of respondents choseIR’s ability to build strongrelationships with investorsand analysts as a mostcritical factor.

88%

2. What do you think determines IR success?


In more than three-quarters (77%) of companies, an IRrepresentative regularly attends board meetings. This is truein companies of all sizes, although it is a bit more common in

in EMEIA). It makes no difference whether the company has atwo-tiered board structure or a single board. It also makes nodifference whether the board has a high or low ratio of executivedirectors to non-executive directors.

In 83% of the companies, the IR function provides a regularwritten report to the directors. Written reports to the board, onthe other hand, are more likely in EMEIA (85%) and least likely in

provide written board reports compared with only 71% of smallcap companies.

Written reports to the boards seem to be more frequent thanpersonal appearances. Thirty-seven percent of IR departments

However, IR representation at board meetings is more likely tobe on an ad hoc or on-demand basis. This is the case in 26% ofcompanies globally, with 22% having quarterly IR attendance atboard meetings and 14% monthly attendance.

The frequency with which IR provides a written report to theboard or sends an IR representative to board meetings increaseswith market cap size. A quarter of mega-cap companies has anIR representative attending board meetings on a quarterly basis

Our survey also found that small cap IR representatives aremore likely to attend board meetings than provide a writtenreport. This could be because there is greater likelihood that IRrepresentatives from smaller companies are often members ofsenior management.

3. How important is IR’s seat at the top table?Most IR departments have regular contact with their boards

8%14%

22%

7%

26% 23%

3%

19%

37%

7%

17% 17%

Yes, everytwo weeks

Yes, monthly Yes,quarterly

Yes, otherfrequency

Yes, ondemand

No

Meetings Reports

79% 74%90%83% 85% 81%

Americas EMEIA Asia-Paci c

Meetings Reports

Small cap IRrepresentatives are likelyto attend board meetings.This could be becausethere is greater likelihoodthat IR representativesfrom smaller companiesare often members ofsenior management.

of companies have an IRrepresentative attendingboard meetings.77%


What’s discussed with the board?Both in writing and in person, stock market and investorsentiment is the topic covered most in the interactions betweenIR and the board. This topic is discussed in 85% of meetings and86% of reports. Actual investor movements are covered more

market liquidity of companies’ shares trading is more likely to becovered in a report than at a meeting.

From a regional perspective, IR representatives are more likelyto discuss shareholder activism and shareholder engagementin board meetings in the Americas than elsewhere. That’snot surprising, given the levels of activism in the US and thegrowing tendency for companies to increase shareholderengagement in response. What is actually surprising is thatthe IR representatives and boards from the Americas are lesslikely to discuss recent regulatory changes in the region. This,however, may be because such matters are more often handledby the general counsel or the corporate secretary’s department,

more likely to cover the most frequently asked questions andrecent regulatory changes in their written reports to the board;they are less likely to cover investor movements and activity.

at meetings and in reports. For instance, because liquidity is amore important issue for smaller companies, it is less likely tobe covered in reports as company size increases. Shareholderengagement and most frequently asked investor questions aremore commonly discussed in meetings as companies get larger;and market and investor sentiment is more commonly coveredin reports. Shareholder activism is more likely to be discussedat mega-cap companies than at those of any other size and alsomore likely to be covered in reports than in meetings (although toa lesser degree).

85%

62%

58%

28%

28%

22%

17%

10%

2%

86%

79%

48%

49%

23%

17%

13%

11%

0%

Market and investor sentiment and feedback

Investor movements and activity

Most frequently asked questions

Liquidity of share trading

Shareholder activism

Shareholder engagement including proxyadvisory rms

Recent regulatory changes

Other

Don't know

Meetings Reports

Market sentiment and activity are the top subjects fordiscussion

0%10%20%30%40%50%60%70%80%

Small cap Mid-cap Large cap Mega-cap

Liquidity of share tradingMost frequently asked ques onsShareholder ac vismShareholder engagement including proxy advisory rms

of the companies havea regular written reportprovided by the IR function.83%

Depending on market cap, different topics are discussed

Company size determines boththe content of meetings andreports required.


The IR-board symbiosisWe also asked respondents both how boards could give IR moredirection and how IR could give more direction to the board.These were open comment questions, so respondents could

How can the board provide moredirection to the IR function?Overall, a third (33%) of respondents said they’d like moredirection from the board on insight into the company strategy.

provide more direction. The third largest group (20%) felt theboard could provide more guidance on IR goals, including idealshareholder structure and engagement. After these three,there is a considerable drop, with just 6% of respondents citingcompany performance issues as the area on which IR needs moredirection from the board.

There is little regional variation in the answers to this question,the exception being the Americas, where 40% want no additionaldirection from the board. Issues relating to IR goals is the secondmost common response in the Americas. Strategy and messagedevelopment came at the third and fourth positions, respectively.

When the responses are grouped by company size, the numberof respondents who do not require any more direction from theboard falls to 10% for small cap companies, and issues relating toM&A becomes the fourth most common response for mega-caps.

How can the IR function providemore direction to the board?When asked what additional direction IR could give to the board,44% said they think the board would like more investor feedback.This was far and away the most popular answer in every regionand across all market cap sizes.

In addition to feedback, which IR departments typically gathervia either formal or informal perception studies, or throughcorporate brokers, 18% believe IR could provide the board withmore insight into wider investment market sentiment. This wouldinclude how the market feels about the stock, demonstrated, forinstance, by sell-side forecasts and written research, as well as in

The third-largest group, with 17% of respondents, believes thereis no additional direction the IR function can give to the board.

Smaller companies are less likely to think IR can’t provide theboard with more direction; they are more likely to mentiongovernance as an area where IR could offer more direction tothe board.

of respondents said they’d likemore direction from the boardon company strategy.33% think the board would like

more investor feedback.44%

IR wants more insight into strategy from the board

IR wants to give the board more investor feedback

44%18%

17%13%

8%7%

5%4%4%

3%3%3%3%

2%2%2%

1%

Investor feedbackMarket sentiment

No more direction necessaryStrategy

Governance and disclosureValuation

Shareholder evolutionShareholder value

Peer benchmarkingFinancial guidance

CommunicationCompetetive landscape

IR valueUnderstanding of business

Equity storyRisk assessment

M&A

33%

29%

20%

6%

5%

4%

4%

4%

3%

2%

1%

1%

Strategy

No more direction necessary

IR goalsCompany performance, understanding

business and key issuesGovernance

Senior management's time andattention to IR

M&AMessage development and

communicationMarket intelligence

Information access and feedback

Risk assessment

Sector trends

Investor feedback isvaluable information forthe board and gives aninsight into the way acompany is perceived inthe market.


Written IR strategiesAs part of the survey, we asked companies whether they had awritten IR strategy. Globally, just more than half of the companies

So why might this be? The intuitive answer is that US companies,which are the largest group of respondents in the Americas,have been doing IR for so long – in some cases, since the early

reassuring to have things written down. That way, there’s lesslikely to be uncertainty or misunderstanding about what thecompany is seeking from its IR department.

Geography isn’t the only determinant of the propensity for an IR

more likely it is to have a written IR strategy. Only 44% of small

with company size, reaching a peak at mega-caps where 61% do.

We also found from our survey that three out of four with awritten IR strategy review them on a yearly basis, while just aneighth of them have not reviewed their IR strategy for more thantwo years.

Formal IR manuals and auditsFormal IR manuals are much less common than writtenstrategies. Just 17 % of companies globally have manuals. In

The same pattern is evident with internal audits of the IR

varies between 24% for American companies and 44% for those

while, in the latter, most are scheduled annually.

While company size does not appear to impact the likelihood of acompany having a formal IR manual, it does affect the likelihoodof it having internal IR audits. The larger the company’s marketcap, the more likely it is to have an internal audit of the IRfunction.

4. Do you have written strategies, manuals and IR audits?

In a fast-changing capital market environment, strategiesneed to be updated regularly

Yes,updatedannually

40%

Yes, twoyears old

7%

Yes, older thantwo years

6%

No47%

0% 10% 20% 30% 40% 50% 60% 70%

Americas

EMEIA

Asia-Paci c

0% 10% 20% 30% 40% 50% 60% 70%

Small cap

Mid-cap

Large cap

Mega-cap

Japan, and is taken very seriously, hence the need for amore formal IR strategy and IR manuals than may existin some other areas.”Ringo Choi Shinichiro Suzuki

The existence of IR strategy papers by geography, and theiravailability by market cap


The existence of written IR manuals supporting IR audits

Yes17%

No83%

12%

29%

Americas

EMEIA

Asia-Paci c

19%

Is your IR function internally audited?

90%

72%

63%

49%

48%

44%

Important internal processes

Disclosure policy

Corporate calendar withdisclosure periods

Internal supporting structures

Sign-off policies

Competencies

Yes,annually

11% Yes, everytwo years

4%

Yes, notscheduled

14%

Yes, other3%

No68%

24%

39%

44%

Americas

EMEIA

Asia-Paci c

By region

24%

31%

33%

45%

Small cap

Mid-cap

Large cap

Mega-cap

By size

By region

What does the formal IR manual cover?

What do IR manuals cover?Ninety percent of formal IR manuals cover important internalprocesses. Other important topics include disclosure policyand the corporate calendar, setting out the disclosure periods.

and disclosure policy in their formal manuals than those in theother two regions. Larger companies are more likely than smallerones to cover competencies, sign-off policies and disclosurepolicy in their manuals.

Three quarters of the companies assess ad hoc disclosureprocesses during internal IR audits. Almost half assessstatutory reporting, but only 15% assess forecasting.

while, in EMEIA, it is statutory reporting that is most audited.

in the Americas.

Ad hoc disclosure processes are more likely to be the subject ofaudits as company size increases. Small cap companies that audittheir IR function internally are more likely to make IR strategy,IR effectiveness and the corporate calendar the subject of theiraudits than bigger companies.

Disclosure is the most scrutinized issue

73%

49%

35%

28%

18%

15%

Ad hoc disclosureprocesses

Statutory reporting

IR effectiveness

IR strategy

Corporate calendar

Forecasting

With the growing importance of

also part of internal audits.


Contact with other departments

(75%) and planning, budgeting and forecasting (72%).

The least likely of the departments listed for IR to have regularcontact with are HR, and risk and compliance management.

these departments.

The likelihood of IR being in regular contact with accounting

sizes. There is, however, considerable variation in the likelihoodof IR contact with other departments, depending on the size ofthe company and where they are based.

On a regional basis, American IR departments are notably morelikely to be in contact with marketing, sales and operations, HR

with risk and compliance management, but less likely to be incontact with marketing.

most from the global norm. For all departments listed, thelikelihood of Asian IR having regular contact is lower than the

IR departments, the likelihood of contact with legal and tax is

contact level with treasury is 30 percentage points lower thanthe global average.

Differences by market capWhen there are deviations from the global norm accordingto company size, the likelihood of regular contact with otherdepartments increases as cap size increases. For example, thelikelihood of IR’s contact with the treasury doubles from 41% insmall cap IR to 82% in mega-cap IR. This is followed by corporatecommunications, which sees an increase from 66% at small caps

where there is an increase from 62% to 86%.

The likelihood of regular contact with strategy is consistentamong small and mid-cap companies as well as among large- andmega-cap companies. However, it shows a jump of 15 percentagepoints from mid to large cap.

Fifty-four percent of the IR departments contacting accounting

in regular contact with either marketing or M&A departments,and 38% of those in contact with HR departments. For all otherdepartments, the contact percentage is between 40% and 50%.

The best practice of IR contact with various departments isrelatively consistent. This can be seen when looking at regionaland cap size differences. In Asia, with the exception of treasury,contact with all departments is more likely to be formal thanin other regions. According to company size, formal contact is

of the 12 departments, formal IR contact is more likely for bothsmall and mega-cap companies than it is for mid- and large-capcompanies.

When IR is in regular contact with another department, it is mostoften on a monthly basis, except in the case of M&A and HR,where it is more likely to be on request. IR functions are mostlikely to have quarterly contact with risk and compliance (25%)and sales and operations (22%).

5. How well connected is your IR function?

IR is most often in regular contact with the accounting and

0% 20% 40% 60% 80% 100%

Accounting nance

Corporate communications

Corporate nance

Planning, budgeting and forecasting

Legal and tax

Strategy

Treasury

M&A

Sales and operations

Marketing

Risk and compliance management

HR

InformalFormal contact


interdepartmental contact is more likely to be on request and, inEMEIA, there is a slight trend toward quarterly contact.

Importance of interdepartmentalconnectivityWe asked IR functions that had regular contact withother departments to rate how important they thoughtinterdepartmental cooperation was to the IR practice. They wereasked to rate on a scale of 0 to 10, where 0 is not at all importantand 10 is extremely important.

Except in the case of HR, which had an average score of 6.3,cooperation with all departments was rated as very important

departments gave it a perfect 10 score (extremely important)and just 2% gave a score of 5 or less. The importance ofcooperation with planning, budgeting and forecasting was

Marketing had the second-lowest score, after HR, with anaverage score of 7.4. Here, 28% gave marketing a perfect 10,52% gave it a score of 8 or more and 22% a score of 5 or less.

higher than it is in the Americas and EMEIA; cooperation withcorporate communications is rated less highly (7.6). There aretwo departments with which cooperation is notably more valued

with an Americas average of 8.3 compared with 7.8 in EMEIA

Differences by market capThe importance of cooperation with HR increases as cap

and mega-cap IR departments (7.6 and 8.0) than it is for mid-and large caps (7.2 and 7.1).

What is most remarkable about the importance of IRinterdepartmental cooperation, however, is how little it variesaccording to a company’s market cap. Often, what is importantto IR executives at small and large companies differs markedlyas the nature of the job alters according to company size. So it is

interdepartmental cooperation to be vital to good IR practice.

Frequency of contact with other departments

0% 20% 40% 60% 80% 100%

Accounting nance

Planning, budgeting and forecasting

Risk and compliance management

Legal and tax

Marketing

M&A

Sales and operations

Strategy

HR

Corporate communications

Corporate nance

Treasury

Monthly

Bi-monthly

Quarterly

Only on request

Other

“Implementing the IR function is crucial to gettingready for an IPO, being regulatory compliant andensuring a ‘one voice’ policy post IPO.”Dr. Martin Steinbach

How important is interdepartmental cooperation to goodIR practice?*

*on a scale of 0-10

8.6

8.46.3

8.27.4

8.17.5

8.07.8

IRRisk and com

pliance

HR

Accounting

Planning,budgeting Corporate

Legal and tax

M&A

Sales and

Treasury

Corporate

andforecasting

comm

unications

management

Stra

tegy

operations

Marketing


What’s discussed with whom andhow often?

Ninety-seven percent of IR teams are in regular contact with the

basis, 52% meet monthly and 13% quarterly.

contact discussing quarterly reports and 80% discussing annualreports. Financial requests from investor queries and disclosureissues follow, being discussed by 75% and 74% respectively.

The key input to IR that can be provided by the accounting and

IR teams do want context, insight and a bit of color for thepresentation of this data.

Planning, budgeting and forecastingSeventy-two percent of IR teams are in regular contact with theplanning, budgeting and forecasting department. For 50%, this is

Discussions with planning, budgeting and forecasting areprimarily about guidance. The level, focus and frequency ofthese discussions will depend on how regularly guidance is given.Rolling mid-term forecasts and follow-up from investor requestsare also common topics for discussion, although less so among

The key input for IR here is that they receive reliable companyand sector forecasts to build the investor guidance.

StrategySixty-six percent of IR teams are in regular contact with thestrategy department. For 41%, this is on a formal basis, 36%meet monthly and 16% quarterly.

discussions on M&A and competitor positioning. Just a quarter ofcompanies discuss shareholder activism.

The most important outcome of IR’s discussions with strategyis an understanding of the company’s strategic goals and theirunderlying assumptions.

The typical content and agenda of meetings with theplanning, budgeting and forecasting department

78%

73%

70%

65%

40%

u dance – next 12 months

oll n m d-term forecasts

ollow up on ad hoc re uestsfrom

u dance – next uarter

u dance – next half year

91%

80%

75%

74%

63%

59%

49%

46%

Quarterly reports

Annual reportsA

D sclosures

Mana ement’s jud ment

Half-year reports

Cr t cal account n pol c es

The typical content and agenda of meetings with the

The typical content and agenda of meetings with thestrategy department

97%

77%

71%

42%

25%

Corporate strate y

M&A ( e what s the rowthstory

Compet tor pos t on n

Jo nt entures (JVs andcooperat ons – transact ons

hareholder act sm

“The US market has the longest historyof investor relations and is now facingshareholder activism, making the IRfunction increasingly important.”Jackie Kelley


monthly and 11% quarterly.

of discussions with the IR department. The next most commonsubject for discussion is capital markets strategy, especially

Discussions about new markets and new clients are also more

companies than their larger counterparts.

Legal and taxSixty-eight percent of IR teams are in regular contact with legaland tax. For 42%, this is on a formal basis, 34% meet monthlyand 17% quarterly.

discussion between IR, and legal and tax. Shareholder issues isthe next most common topic, followed by regulatory issues.

The fact that support and preparation for annual generalmeetings (AGMs) is a relatively uncommon subject for discussion

it is the most discussed subject between the two departments.

M&AFifty-eight percent of IR teams are in regular contact with theM&A department. For 36%, this is on a formal basis, 27% meet

Acquisitions are overwhelmingly the most common topic for

strategy. The subject of divestitures becomes a more likely keytopic as market cap size increases; it is most common in EMEIA

The typical content and agenda of meetings with the

85%

68%

44%

29%

Cap tal strate y andobject es

Cap tal markets strate y ra s n fund

Or an c

New markets or new cl ents

The typical content and agenda of meetings with thelegal and tax department

84%

78%

71%

66%

40%

Corporate o ernancessues

hareholder ssues

e ulator ssues

A M support andpreparat on

Cont n ency d sclosures

The typical content and agenda of meetings with theM&A department

94%

61%

58%

47%

Ac u s t ons

D est tures

Corporate nance strate y

Deal ow


Corporate communicationsEighty-four percent of IR teams are in regular contact withcorporate communications. For 44%, this is on a formal basis,44% also meet monthly and 6% quarterly.

Discussions with corporate communications tend to focuson message positioning and reputation management. This isfollowed by discussions on goals, although this issue is lessrelevant for IR departments in larger companies and in theAmericas. Reputation management is the most discussed issue in

the other two regions. Half of the survey respondents who chose

press releases as a topic for discussion.

as key is instruction on the alignment of external messages.

TreasurySixty-two percent of IR teams are in regular contact with thetreasury department. For 42%, this is on a formal basis, 42% alsomeet monthly and 11% quarterly.

The most common issue for discussion is liquidity management,followed by funding issues. Funding issues is a more common

of small cap companies where IR and treasury are in regularcontact, covenant reporting will be a key discussion topic. Amongmega-cap companies, this is just 8%.

The key inputs treasury can provide to IR are information onliquidity and debt strategy.

Sales and operationsForty-two percent of IR teams are in regular contact with salesand operations. For 40%, this is on a formal basis, 36% meetmonthly and 22% quarterly.

Trends are the most mentioned subject for discussion, followed

product strategy being the most common subject. Discussionsabout customer relationships are more likely in small capcompanies, while the likelihood of discussions on innovationsincreases as cap size increases.

The key issues IR needs to know about from sales and operationsare market trends, opportunities and threats.

The typical content and agenda of meetings with thecorporate communications department

The typical content and agenda of meetings with thesales and operations department

65%

56%

46%

14%

12%

os t on n

eputat onmana ement

oals

Char table act ty

ponsorsh ppro ram

84%

74%

60%

54%

51%

Trends

roduct strate y

Customerrelat onsh ps

Market entr es

nno at ons

The typical content and agenda of meetings with thetreasury department

78%

71%

33%

24%

L u d ty mana ement

und n ssues

Co enant report n

se of ( O or Oproceeds


Risk and compliance managementThirty-eight percent of IR teams are in regular contact with risk

monthly and 25% quarterly. Given the growing importance of riskand compliance management in most regions around the world,we expect this percentage will grow in the future.

Risk disclosures are the most commonly discussed topic,particularly among larger companies. There is considerably

MarketingForty-one percent of IR teams are in regular contact withmarketing. For 36%, this is on a formal basis, 32% meet monthlyand 18% quarterly.

Marketing initiatives are the most common key discussion points,

Media strategy and corporate communications are more likelyto be discussed in smaller companies, most likely becausemarketing will have a closer involvement with this issue at thesecompanies.

HRThirty-two percent of IR teams are in regular contact with HR.For 38%, this is on a formal basis, 24% meet monthly and 18%quarterly.

Executive compensation is the key issue that IR wants to knowabout from HR.

The key area for discussion is management stock option plans,

discussed by small cap companies and hardly discussed at all in

The typical content and agenda of meetings withthe marketing department

74%

70%

60%

42%

Market n n t at es

Med a strate y andcorporate commun cat on

nanc al press act ty

En ronmental soc al ando ernance (E orporate soc al

The typical content and agenda of meetings with therisk and compliance management department

74%

65%

60%

48%

38%

sk d sclosures

Current r sks

Expected r sks

sk matr x w th r sk types

robab l ty of r sks

The typical content and agenda of meetings with theHR department

61%

48%

45%

28%

Mana ement stock opt on plans

Employee share plans

Tra n n of nternal teamson cap tal market ssues


Leading the IPO marketWe’ve been guiding high-growth companies and business leaders safely through theIPO process and beyond for decades, and many of the entrepreneurial companieswe have worked with have gone on to become major global organizations. Ourexperienced teams around the world can help your business prepare for life as a public

strategic transaction.

EY can help you:1. Implement an IR function2. Support the IR strategy, manual or policies, and the

IR calendar3. Execute IR audits4. Establish regulatory compliance5.

foundation6.



Your contactsOur IPO leaders lookforward to talking to youin person.

Maria Pinelli

[email protected]

Jackie KelleyAmericas IPO [email protected]

Ringo Choi

[email protected]

Dr. Martin SteinbachEurope, Middle East, India and Africa(EMEIA) IPO [email protected]

Shinichiro SuzukiJapan IPO [email protected]+81 3 3503 2510

ey.com/IR

Global IPO Center of Excellence

hub which provides access to our IPO knowledge,tools, thought leadership and contacts fromaround the world in one easy-to-use source.For more information, please visit:

ey.com/ipocenter

About EYEY is a global leader in assurance, tax, transaction and advisoryservices. The insights and quality services we deliver help build trust andconfidence in the capital markets and in economies the world over. Wedevelop outstanding leaders who team to deliver on our promises to allof our stakeholders. In so doing, we play a critical role in building a betterworking world for our people, for our clients and for our communities.

EY refers to the global organization, and may refer to one or more, ofthe member firms of Ernst & Young Global Limited, each of which is aseparate legal entity. Ernst & Young Global Limited, a UK company limitedby guarantee, does not provide services to clients. For more informationabout our organization, please visit ey.com.

About EY’s IPO servicesEY is a leader in helping to take companies public worldwide. Withdecades of experience, our global network is dedicated to serving marketleaders and helping businesses evaluate the pros and cons of an IPO.We demystify the process by offering IPO readiness assessments, IPOpreparation, project management and execution services, all of which

Excellence is a virtual hub that provides access to our IPO knowledge,tools, thought leadership and contacts from around the world in oneeasy-to-use source. For more information, please visit ey.com/ipocenter.

© 2015 EYGM Limited.All Rights Reserved.

ED None

This material has been prepared for general informational purposes only and is not intended tobe relied upon as accounting, tax, or other professional advice. Please refer to your advisors forspecific advice.

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