Elevating Investor Relations: Evolving tools for corporate intelligence

Bloomberg

8 hours ago

Welcome to Elevating Investor Relations, Bloomberg's series on the evolving role of corporate investor relations.
As the amount of data density available to any organization increases exponentially with time, so too does the challenge of drilling down into it to find strategically actionable insight. In this article, we will explore how to leverage this data as a source of competitive edge for investor relations (IR) teams.
From insight to influence
For a modern IR team, deriving an edge from data means more than just knowing which investors are buying or selling their company's stock: it means having a firm grip on exactly what competitors and peers are doing and saying, whether that's the details from their latest figures or the finer points from a potentially disruptive product launch.
Not only can that intelligence go to inform their company's future disclosures and pre-empt the questions that investors will ask at the next opportunity, but it can be fed back into internal channels to drive better strategic making and improve IR's standing.
A recent survey of IROs by the Canadian Investor Relations Institute (CIRI) found this aspect of the role has grown to be a recognized part of the IR team's mandate, with 95 percent of IROs reporting that they regularly gather information on their company's market competitors. Nearly two thirds of IROs report that their intelligence-gathering effort feeds senior management's strategic discussions and decision-making, while 61 percent say it informs IR strategy and 22 percent regularly provide competitive intelligence to board members.
Legacy of insight
Notably, the notion of having competitive intelligence to operate from is nothing new. Competitors have been seeking any information they can get their hands on to achieve a competitive advantage over their rivals for as long as the marketplace has been open.
In the history of public companies, competitive intelligence took on a more structured form in the 20th century, when companies founded dedicated market research departments to collect and analyze information about not just their own customer preferences.
By 1983, Motorola CEO Bob Galvin had established one of the world's first formal corporate competitive intelligence divisions, which produced a 'steady stream of well-sourced intelligence analyses on competitors' moves, industry and market evolution, and technology trends', according to the Journal of US Intelligence Studies.
Smarter tools
Today, the rise of data and the tools to extract insights are helping companies keep up real-time monitoring of their competitors and market dynamics. For IROs, who are already so plugged into what the market says and feels about their organizations (and about their rivals), the continued evolution of competitive intelligence can help them drive those decisions first-hand.
While common sources of intelligence include external databases, competitors' publications and other market data, advanced corporate finance tools can give issuers even deeper insights that skilled IROs can readily turn into new sources of edge above their peers and rivals.
These tools include:
Customer relationship management (CRM) tools – on a simple level, these allow IR teams to keep track of their investors, the meetings they have held with them and any notes they want associated. These are increasingly being fed into by other data tools to create fuller investor profiles, including relevant analyst information, driving factors behind their buy or hold decisions and much more.
Real-time market analytics – fetching information from the markets in real-time, whether concerning your own companies, those in your immediate peer group or those further afield. Analysis using these tools is becoming increasingly sophisticated, with platforms like Bloomberg's terminal allowing IR teams to analyze how companies rank or key metrics like earnings, fair value estimates or ESG performance, and compare performance across individual business lines or CSR initiatives.
Stock surveillance – using market data to monitor critical market movements and emerging trends actively, as they occur, to allow IR teams to oversee strategic responses, or to help further hone their outgoing market communications for maximum impact.
Investor targeting – using this same real-time data to give insights into the buy-side's biggest institutions, allowing IR teams to see which investors might make a good match for them. Tools like the Bloomberg Terminal allow you to see who owns your stock and peers, track what they're trading and follow corporate activism and proxy votes.
Analyst insights – taking stock of the sell-side's research, estimates and recommendations to both identify any deviations between what an analyst says and what a company's reality is, or giving IR teams the power to identify any weak points in their messaging and derive measures to counteract them. The Bloomberg Terminal allows IR teams to compare recommendations side-by-side and refine by price target, period, total return rankings and more.
Data visualization – to augment this powerful suite of tools, many IROs use powerful charting software to visualize key data and help present it to various stakeholder audiences, whether that's getting internal buy-in from senior management or presenting granular insights to investors and analysts to help drive their understanding of their companies. To see how leading IR teams drive excellence through storytelling, click here.
Each of these tools can help IR teams drive competitive edge on their own, but when combined – with comparable data able to be shared between them – IR professionals are put in the driving seat, able to make strategic decisions with the data they need to back it up.
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