Investor Relations can be a detailed, complex service provided within a large multinational organization across language and cultural barriers. As such, sometimes the basics can slip through the cracks.
For experienced IR professionals, it would be intuitively obvious that anyone looking for “investor relations” at a specific company would either search for the same while using the company’s name, or that one would go to the company’s website and find a link to investor relations from there.
But, what about other potential users? Perhaps users who don’t realize that what they are looking for would fall under the purview of IR, or those who are not especially familiar with such a concept? Certainly, such users are not likely become major shareholders anytime soon, but that doesn’t mean that the data or information they seek won’t help to shape the opinions of others who might actually be desirable shareholders. How would they find your information?
Are you in there?
Out of the Mouths of Babes
Our pseudo-hypothetical question comes not from hours spent thinking about the possibilities of IR, but rather courtesy of a gathering of adult men around the backdrop of a basketball game that no one was really watching. For those of you who happen to have not attended an American university with a respectable football (American, not Soccer) team, but a basketball team with a tradition of epic futility, let me assure you that the purpose of the gathering from the first moment was actually to just get a bunch of friends back together in the same room where they could talk.
During this gathering a friend of mine who is both a successful professional and a very intelligent human being, remarked about how he had stopped using a particular company’s products, and that he was working to have the company also banned from the vendors list at his firm based upon the fact that the company in question did significant business with the government in Darfur. What struck me as odd, was that the company in question has a reputation as a rather clean and upstanding corporate citizen.
It turns out that his daughter had done a report for a school project, and that she had used many different sources of information for the project. Long story, made short, she had misinterpreted an article which listed the company in question as having declined to support a public boycott and thus was listed by the boycott organizers as a “friend” of the government in Darfur.
Three seconds on the company’s website led me to the company’s statement regarding the boycott effort in which it referred to its corporate business and ethics guidelines prohibiting the company from endorsing, engaging in, or contributing to any effort regarding elected officials. Such a policy is common among multinational companies that don’t want to get dragged into local politics, nor give off any appearance of influencing elections particularly in smaller democracies where such influence might be seen as “buying” government officials.
Though such a policy is not necessarily intended to cover a situation like the one in Darfur, it is nonetheless true that boycotting against government officials would violate the company’s policy. However, the company did support and endorse various condemnations and calls for action against the events transpiring in Darfur. In addition, while the company could potentially join a boycott against Sudan, or against other companies that did business therein, it could not take part in a boycott which specifically mentions the government and government officials. Such a distinction is, not surprisingly, lost on the passionate.
It Is An Island That Cannot Be Found, Except By Those Who Have Already Been There
Captain Jack Sparrow says those words in the movie Pirates of the Caribbean. At first, it sounds like nonsense, and indeed if one follows the logic all the way back to the beginning it makes it impossible for the first person to have ever been there, but it does suggest a certain truth. If you know where you are going, it is much easier to get there.
The ethics policy of the company was linked prominently from the Investor Relations page, and a press release stating much of the same was similarly easily available from the page. So, why didn’t a carefully researched paper turn up such items?
The company in question is one that has a significant brand name in the retail space and thus has a customer focused website using the company name, and another more corporate and operations focused website under a variation of the name. Having gone to what she assumed was THE company website and found nothing, and also having gotten no response from the inquiry she sent – to the customer service department – the intrepid researcher assumed the company was whitewashing its position by not saying anything, thus their inclusion in the list of bad actors.
Interestingly enough, she found the company site by using the dmoz directory. The dmoz directory is an open directory project in which human beings catalog and list websites much in the same way that Yahoo used to do (and still does) prior to the ascension of search engines and Google. As an “open” resource, dmoz is held in high regard in many areas of academics which explains why she started there.
The catch? The company’s corporate site is not in the directory, likely because it has never been submitted.
All of this adds up to a company that did everything right being dropped from people’s mental list of acceptably behaving enterprises and in doing so, could have cost it millions of dollars in sales either by propagation of the misinformation, or in this case by being dropped from a large organization’s approved vendors list.
IR Best Practices Internet Directories
While this single example will not apply to all companies, of course, the fact remains that there are millions of people who are not familiar with the nuances of corporate websites, ethics policies, investor relations departments and the like. For them, finding you depends entirely upon luck, unless you put up signs along the road.
No Investor Relations group can control the actions of Google or other search engines, but there is no reason to not have any and all company websites or portals listed in the major web directories, as well as in those that carry some authority for your specific industry. Often, getting listed is as simple as filling out a form requesting to be listed and then waiting for them to get around to you. (These directories tend to be overwhelmed by submissions.)
In the end, a simple amount of effort could pay off handsomely when the next person or group looking for information finds not only the public face of the company online at thecompany.com proudly declaring its annual sales event, but also the next listing at thecompanycorporation.com and gets their facts straight.
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