Moksh Popli Explains What Investor Relations Experts Really Do
When it comes to publicly traded companies, people tend to overly focus on the roles carried out by those in high-authority positions like the CEO or CFO. For instance, most individuals would know that Elon Musk is the CEO of Tesla. A very small percentage of them, however, would be able to name a single investor relations expert who might be working at Tesla.
This is a common trend that came to life as a consequence of the media dedicating most of their attention to high-profile individuals who lead companies. Nevertheless, it does not mean that the jobs of everyone else in the company should be neglected. For instance, the aforementioned role of investor relations professionals can often be the reason why companies get funded. Thus, what exactly do people who work in investor relations do on a day-to-day basis? Moksh Popli, a business consulting professional, answers this question below.
Help Build Investor Confidence
Obviously, the key job duty here revolves around establishing a rapport with existing and prospective investors. In other words, they are the ones who attract prospective stockholders and help them go through the process of buying shares. In order to do so, however, they must convince people to dedicate their capital to the corporation. After all, individuals will seldom give away their money to businesses that show no promising signs of success.
Fortunately, investor relations experts are there to help potential buyers get familiar with the industry, understand where the company is going, see how stock prices have behaved in the past, and much more. In other words, they do everything that is necessary to incentivize someone enough to become financially involved with the venture.
Keep Constant Track of the Market Trends
According to the founder of Moksh Popli Consulting, Moksh Popli, investor relations come with an important responsibility to continuously scan the market for upcoming changes. For those unfamiliar, this means that they spend hours going over the recent trends in their industries in order to predict where the company may need to make changes.
So, if the market seems to be exhibiting a slight downturn, investor relations expert will advise the CFO about the proper course of action. More importantly, they will also communicate the planned course of action to the investors in order to increase transparency and ensure a fruitful relationship.
Take Charge of Annual Financial Documents (10-Ks)
As most investors know, companies that are publicly traded must issue an annual report in order to stay compliant with the Securities and Exchange Commissions’ laws. This is known as the 10-K where all financial documents are released to the public. Why are these so important? Well, absent proper data, investors would not be able to make decisions about investing in the company.
A common misconception, however, is that only accountants handle these tasks as they are the ones who deal with the numbers. In reality, they are only one of the links in the chain that holds the entire operation together. Annual reports also require input from those who may be working in low-level tasks all the way to the actual CEO who must write a letter addressing the shareholders. And who ensures that the report is flowing smoothly and meets the standards of the market? Those who handle investors relations! After all, they are the ones who must guarantee that the stockholders are on the same page as the management.
Bridge the Gap Between Investors and Management
Although it was mentioned, it is important to understand how much time investor relations professionals spend making sure that the management and investors are operating coherently. The reason why they must do so comes from the fact that these two parties may not always have the same goals in mind. For instance, investors are always focused on getting a high return on their investment.
This happens when the stock prices go up and they are able to cash in on their purchase. Management, on the other hand, is primarily focused on maximizing companies’ revenues. Well, higher revenues do not always translate to higher stock prices. Thus, the two parties may not be chasing the same result. Fortunately, mitigating these differences is one of the reasons why investors relations positions were invented in the first place.