Managing the Narrative: Investor Relations Officers and Corporate Disclosure

• In Event: Investor Attention and the Role of IR

Abstract

Investor relations officers (IROs) play a central role in corporate communications with Wall Street. We survey 610 investor relations officers at publicly traded U.S. companies and conduct 14 follow-up interviews to gain insights into the nature of their interactions with sell-side analysts and institutional investors, and to deepen our understanding of the role of investor relations officers in corporate disclosure events. We find that public earnings conference calls are the most important venue for management to convey their company’s message to institutional investors, and that preparing for and managing these calls are the most important determinants of IRO job performance. IROs indicate that private phone calls are more important than 10-K/10-Q reports, on-site visits, and management guidance for conveying their company’s message, and more than 80% of IROs report that they conduct private “call-backs” with sell-side analysts and institutional investors following public earnings conference calls. Our findings also suggest that IROs play an important role in shaping corporate disclosure, and that their effectiveness in doing so is a very important aspect of how they are evaluated. We explore numerous topics that IROs are uniquely suited to address, and we provide insights into the investor relations, analyst, institutional investor, and disclosure literatures.

Authors

• Lawrence D Brown, Temple University

• Andrew C Call, Arizona State University

• Michael B Clement, University of Texas at Austin

• Nathan Y Sharp, Texas A&M University