Even if your Investor Relations (IR) budget is not as big as the New York Yankees payroll, you can accomplish a great deal.  Just follow these simple, common-sense steps. 

As a former Investor Relations Officer (IRO),  my Investor Relations (IR) project wish list was big. Unfortunately, my IR resources weren’t. I worked in a company that operated lean which meant I was the team and my IR budget was on the Keto diet.

But even with my limited IR resources, I was still able to get some of my most crucial outsourced projects approved.  How did I accomplish this feat on such a mean and lean IR budget?  Well, it wasn’t easy. But I firmly believe that the results I achieved are doable and can be replicated at other companies. 

Building Blocks for Better IR Results

Share the Wealth…and the Expense – My favorite tactic and the one that worked the majority of the time, was something I learned early on in life: Share

Investor Relations touches nearly every discipline within the company including Finance, Human Resources, Operations and Sales, to name a few. Because I had built relationships with other executives in the Company, I was able to more readily get their buy-in on the benefits of a project without a lot of heavy lifting. And once I got their buy-in, I asked them to share part of the project’s expense.  Sometimes getting support from other departments wasn’t easy, especially when it came with a price tag. But, having built up some goodwill helped tremendously. By sharing the benefits and the expense – everyone wins.

Let me give you a real-life example:

I wanted to create a video targeted toward the investment community that could live on our investor website and showcased the unique and impressive industrial manufacturing capabilities of our team, which was a major competitive differentiator. While investors and analysts loved touring our production facilities, the remote location oftentimes made it more difficult. So, why not bring our manufacturing prowess to them by way of video? The problem was I had no budget for this and when I floated the idea by my Executive Team, they had a lukewarm reaction.  I really believed in the project and felt strongly that it could have a far-reaching impact, including reducing management’s time on the road and facilitating introductions to the investment community.

“Stop, collaborate and listen,” is what I did next.  (1990 Vanilla Ice anyone?) I took a step back and thought about the Company as a whole. The order book was steady, but not at capacity and there was a shortage of skilled labor. Was there a way for this video to address those issues as well?

Ultimately, I partnered with Sales and Human Resources on the project, sharing both the expense and the success. We changed the scope of the video so that the target audience was not singularly focused on the investment community but included customers and potential employees as well.  The sales team used the video on the Company website and in customer meetings to showcase the team’s manufacturing capabilities and Human Resources used the video on the careers page to entice candidates to apply and during the onboarding process to give an overview of the Company.  An unanticipated by-product was a surge in employee engagement. The video created buzz around the company, especially on the production floor where stars were born, and pride was boosted.

Clearly Articulate the ROI – Don’t even think of asking for budget dollars until you’re able to clearly articulate the return on investment (ROI) or financial benefits the company will gain by incurring the expense.  Depending on the project, you may have to get creative here.  And don’t forget to factor in the soft costs that can be saved or avoided by making the investment. Anticipate the questions that your Executive Team may ask.

For the purposes of illustration, let’s say your company has poor ESG ratings.  Your executive team knows ESG is important, but since “investors aren’t asking me about ESG,” they are not sold on the idea of investing resources to improve the ratings.  But, as an IRO in the know, you are aware that ESG issues are becoming increasingly important to investors.  In fact, ESG is so important to investors that 1 in 4 dollars of all investible AUM are going towards sustainable investments (BTW that is $12 Trillion!) AND 75% of institutional investors surveyed report that they consider ESG factors when making investment decisions. BACK TO BASICS – AN ESG PRIMER. With the rise of passive ESG investing, that means the company’s poor ESG ratings are preventing it from being included in certain ESG indexes or funds.  These low ESG ratings can translate into a potential loss of millions of investment dollars in your company. 

Suddenly hiring an ESG expert to do a deep dive into the ESG ratings and recommend methods for improvement just got a lot more palatable.

Rob from Peter to Pay Paul – If your company’s budget is tight, you might need to get a little creative.  First, analyze your expenses, and understand your budget’s costs and benefits.  Second, if you need additional funding, renegotiate your budget costs or shop around.  Perhaps you need to change the scope of the budget.  For example, do you really need four software licenses, when only two people are using the program?  Third, analyze your service providers.  Is there overlap?  Are there extra bells and whistles that you are currently paying for, but don’t need?  Look into all your budget lines to see what else you can trim.  These actions may not result in enough savings to offset the cost of the entire project,  but showing your executive team that you’re willing to do whatever it takes to get your IR project off the ground can help you gain support points, and potentially some extra budgetary bucks.

In conclusion, taking a collaborative and thoughtful approach by A) sharing costs and benefits with other departments, B) clearly and perhaps creatively articulating the ROI on the project and C) optimizing your budget dollars to partially fund your project will go a long way in garnering support and dollars for your IR projects.