Investor Relations

90INVESTOR RELATIONSwho have been identified as potential buyers of the company’s shares, inorder to present its products, its business model, its strategy, and its growthprospects.Hopefully, you will have successfully convinced the institution to considerbuilding a position in your company. It will be time to “harvest” and the chiefoperating officer (COO) or the chief financial officer (CFO) may have to beinvolved to secure the fund manager’s decision to invest in your company.A meeting with the CEO is usually required to convert initial ownershipinto a larger stake. That is the “lock” phase of the process. By the way, theIRO should see to it that the CEO and the chairman have personal contactswith the chief investment officers at major institutions. Such relationshipscan prove useful if the company is under attack or needs to have specificresolutions approved at the shareholders’ meeting.This approach provides another reason why it is important to set outspecific selection criteria during the targeting process. It will also optimizethe amount of time management devotes to Investor Relations, which shouldin any case not exceed 20%.3.3 UNDERSTANDING MARKETEXPECTATIONSA retail investor, who may be planning to buy a car, will want an idea ofwhere the share price might stand at the end of the year so that he or she cansell shares at the highest price, whereas some analysts will seek to checkthe plausibility of earnings estimates for the next five years. All in all, listedcompanies must respond every day to a wide range of expectations andmeet all of them in one way or another.There are expectations about both the form and content of financialcommunications.3.3.1 Form More and more people base their definition of accessibility onhow easily information can be found on a company’s Web site. They willalso look at whether they have a specific contact within the company. Thecontact’s information with the person’s name should be clearly shown onthe documents the company sends out. It may be the person in charge ofrelations with retail investors, an IRO, or a press officer. Rating agencieswill usually look to the IRO (or the Debt IRO if there is one), the CFO,or the treasurer for information, while journalists will want to speak to