CORPORATE ADMIN (INVESTOR RELATIONS)

Corporate Administration (Investor Relations - IR)

Investor relations (IR) may be defined generally as the strategic management of public relations (PR) activities intended to coordinate information about a business entity, related to a particular business entity, for dissemination to existing or potential investors, existing or potential shareholders, financial institutions, financial news media outlets, financial speculators or the public at large, to enable such entities or individuals to make informed decisions about such business entity, the most-critical of which such decisions may be generally to inform decisions by such entities or individuals about whether or not to invest their capital in such business entity.

Since the most critical information to be disseminated about such business entity relates to the financial activities and strength of such business entity, the IR function may generally report to the chief financial officer (CFO) or Treasurer of such business entity.

Depending on the size of such business entity, such IR may be the responsibility of a dedicated IR Officer (IRO) (perhaps reporting directly to the CFO with an indirect report to the CEO, or perhaps as just a direct report to the CEO) managing an entire dedicated IR department or small IR team, or may even be a single individual within such business entity, or the entire IR function itself may be delegated by such business entity to an outside subject matter expert (SME) business entity or individual specializing in IR (outside IR SME).

IR departments must be fully-integrated internal business partners with many other internal departments, such as accounting, C-Suite, finance, government relations, public relations and others, so that IR personnel may be aware of financial and regulatory requirements affecting the business entity so that management may be able to make informed business decisions regarding how to relay relevant developments to outside individuals and entities.

IR departments may play a critical role in initial public offerings (IPO) during the pre-IPO phase, when outside investors need accurate information about all aspects of the business entity to make informed decisions about whether or not to invest in the IPO.

Within the IR department, there may be one or more investor relations managers (IRMs), whose responsibility it is to coordinate all the communications and documentary materials for any particular task identified by the IRO or whomever may be designated within the corporate structure of the business entity to manage the IR function.

Legal support for the typical IRM responsibilities, such as creation of research models, data analysis, data analytics, data visualizations, document collection, document editing, financial modeling, interactions with equity research analysts, preparation for investor events, preparation of IR announcements for news media and the business website and presentations.

Due to the extremely sensitive nature of any information (financial or otherwise) to be disseminated by such outside IR SME regarding such business entity, if IR is indeed delegated by such business entity to such outside IR SME, it would be prudent for such business entity to enter into a very strongly-worded confidentiality agreement or non-disclosure agreement (NDA) with such outside IR SME, stating unequivocally the fiduciary duty owed to such business entity by such outside IR SME, providing for strong penalties against such outside IR SME itself and also against the officers, directors, employees, agents and affiliates of such outside IR SME personally (through written personal guarantees attached as exhibits to such confidentiality agreement or NDA), and perhaps may also include as another exhibit a fidelity or other type of bond provided through an outside bonding or insurance company, as a further attempt to ensure the complete confidentiality of such outside IR SME and all those associated with such outside IR SME.

Legal support for all general tasks related to IR, such as: attending conventions, press conferences, private meetings between authorized IR representatives of such business entity and investors (which may be known generally in the business world as known as "one-on-one briefings"), shareholder meetings and trade shows; broker relations; communications (such as a chairman or CEO letter to shareholders, consolidated financial statements and supplementary information, line of business letters to shareholders, management discussion and analysis of quarterly business activities); compliance; corporate profile management; crisis management; dissemination of IR-related information for PR purposes to outside entities and individuals regarding such business entity's corporate policies regarding environmental, social, and corporate governance (ESG) or other corporate social responsibility positions; enabling the business entity to achieve the optimum share price by reflecting the fundamental values of the company in all interactions with investors and promotional materials; financial information; initiating direct mail and electronic promotional campaigns; management of company filings through interactive data or streaming-data solutions – such as the Securities and Exchange Commission (SEC) EDGAR database and the XBRL international business reporting standard; investor accreditation and support; marketing; new products and securities; organizing conferences and seminars; reputational risk management; reviewing existing and proposed IR materials for the corporate website; reviewing the annual reports prior to publication; and, verbal and written IR-related communications on behalf of such business entity to outside entities and individuals.

Legal support for all the more-nuanced IR tasks, such as: communicating the non-sensitive details of proposed transactions to investors, to gain investor support; developing complex advertising campaigns across various media platforms to encourage investment;

Compliance with the IR-related sections of domestic regulations, such as the Sarbanes-Oxley (SOx) Act (also known as the Public Company Accounting Reform and Investor Protection Act), including Sections 301-302, 404 and 802 thereof.

Compliance with the Securities Act of 1933 (Securities Act) Section 5, which makes it unlawful for any person, whether directly or indirectly, to make use of any means or instruments of transportation or communication in interstate commerce or the postal system to offer to buy or sell any security, unless the offering entity has filed a registration statement with the SEC, through checking and reviewing each publication of an outside IR SME to ensure that all language if neutral and non-offering.

Compliance with the Securities Act Section 17 (b), which requires outside IR SMEs that publish IR and other financial information about public business entities to provide full disclosure about their compensation and relationship to their client in all IR-related materials.

Compliance with the Securities Exchange Act of 1934 (Exchange Act) Section 15, to ensure that the outside IR SME will not be considered as acting either as a "broker" or a "dealer" by promoting certain securities of a business entity through the language of promotion and solicitation materials without an SEC registration.

Compliance with the SEC corporate reporting requirements for public corporations that may be handled by the IR department, such as annual reports, Form 10-K, Form 10-Q, press releases, proxy statements, quarterly reports, Regulation FD, Regulation 8-A and Regulation 8-K.

Compliance with the IR-related sections of international regulations, such as the Canadian Keeping the Promise for a Strong Economy Act (Budget Measures), the French Financial Security Law of France (also known as the LSF or Loi de sécurité financière), the European Union (EU) Markets in Financial Instruments Directive (MiFID), and the Japanese Financial Instruments and Exchange Act (J-SOX).

Compliance with guidance and recommendations by the domestic National Investor Relations Institute (NIRI), and with guidance and recommendations by international IR-related trade groups, such as the Australian Investor Relations Association (AIRA), the Canadian Investor Relations Institute (CIRI) and the United Kingdom (UK) Investor Relations Society (IRS).

Drafted and implemented corporate IR policies.

Defense and plaintiff litigation involving IR firms and individuals.

Last updated 201018_1904