Why investor relations might be foryou
Why investor relations might be for you
Are you intrigued by the idea that Wall Street is your target market? You might be interested in investor relations.
A Wall Street analyst who is influential can send shares of a stock rocketing with a strong recommendation to buy. The stock could plummet if it is learned that an institutional investor has sold off large amounts of shares.
Although sophisticated analysts and investment managers can draw information from many sources, the most important source of information is the company itself. These critical communications are handled by who? The Investor Relations (IR) department.
Stock prices are under constant pressure from companies to move in a direction that benefits shareholders. Usually, this is up.
Investor relations professionals are required to have a combination of skills. They must be able to understand the financial potential of a company, as well as a solid grasp on strategy and operations.
This combination works well for accountants with strong accounting skills. These same accountants are finding that working in Investor Relations Case Study can lead to new career opportunities.
What investor relations does
Investor relations is the department responsible for communicating with decision makers and other influencers that help decide whether or not a company's stock price will rise or fall.
This includes meeting with analysts and major shareholders, creating presentations and talking points to the C-suite and responding to investor inquiries.
Brad Hendricks assistant professor of accounting at UNC says, "That's where accountants really stand out over others because we know the numbers." "We have the advantage of being able communicate this information to a wide range of people with different levels of financial literacy.
Accounting has always played a key role in the preparation and auditing of financial statements. Their role is more forward-looking when they are involved in investor relations.
IR professionals explain not only what has happened to a company, but also what might happen in the future.
This could include explaining how a company plans to deal with a difficult industry trend or laying out the company's growth strategy. They often have to do this quickly -- cutting out unnecessary fluff and getting straight to the point.
More than business
Investor relations are based on the ability of an accountant to understand and interpret the financial statements of a company. It is why a Master of Accounting degree (MAC) with strong accounting foundations and exposure to finance and other business disciplines is so important.
Knowing the language of business is only half of the job. IR professionals are often under pressure to quickly and clearly explain complicated financial information and corporate strategies that may have taken months or years to develop.
Hendricks states that a role like this shows how important it is for an individual to be well-rounded and to have people skills.
Essential skills include solid writing and speaking abilities, as well as the ability to think on one's feet. These skills will be emphasized in a top-ranked MAC program. Students in MAC programs at UNC Kenan-Flagler Business School must take classes in communication. They may also elect to take electives in improv and using data to communicate.
Hendricks states that there is a class in storytelling with data. This is what the investor relations professionals are doing. "You have data, and now you want to help people understand the numbers.
While most accountants won't go into investor relations as their first job after graduation, they could consider a few years of experience in public accounting or in a corporate role that involves financial statement preparation.
Opportunities in IR are increasing
Wall Street is still the main audience for investor relations efforts. However, there are many investor relations teams that are expanding. Individual investors are a new topic that IR professionals are trying to address. They can also be found on social media, where they make their investing decisions.
Although the IR profession is still trying to figure out how best to reach these investors, it is clear that accountants who understand social media and online culture will be more successful.
Hendricks states that companies are engaging with investors differently and earlier than before. "We now have firms that are willing to engage with retail investors. This is a change from what was previously the norm."
For example, companies now frequently use Twitter to share financial information. Although there are still grey areas regarding what companies can or cannot do to communicate with investors online, Hendricks states that it is becoming more important for businesses to "have an ear to all this stuff", if only to understand the questions investors ask and the conversations that are taking place online.
Beyond investor relations
Some accountants find that they are better equipped to handle bigger challenges after years of working in investor relations.
Accounting professionals have excellent communication skills, which are invaluable for top management positions that require a lot speaking and presenting to busy senior executives or boards.
They have a deep understanding of a company's future direction and can take on important finance and accounting positions where they need to understand how their work relates to overall financial performance.
Investor relations offers accountants the opportunity to expand their business capabilities in new ways, whether it's as a way to attract the Street or simply another step in a series challenging and interesting jobs.