Index funds today can no longer simply ignore poor corporate governance at companies, according to an article by Corporate Compliance Insights. Even pension funds cannot ignore the long-term impact that a listed company has on the future of (future) payees. For IR departments, this means that while in the past it was primarily actively managed equity funds that made demands on companies, the stakeholders are expanding: Passively managed equity funds and pension funds are also making demands, especially in the areas of corporate governance, compliance and ESG.
In a survey of 25 investors conducted by the Farient/GECN Group, they indicated that climate change issues are at the forefront of corporate requirements. Topics include CO2 reduction, less dependence on fossil fuels, reduction of water consumption and reversing the spread of plastic in the world’s oceans.
Another important aspect for investors is the management of human capital. This is about more women in supervisory & management boards, succession planning, future workforce and all other related topics that can have a major impact on the success of a company such as the “war for talent”.
So what options do IR teams have to meet this expansion of investor groups with their own information requirements? One possibility may be to increase the size of IR teams. Another possibility is certainly to cluster the stakeholders in terms of their information needs but also in terms of their benefit for the company, in order to use the scarce time resources of the IR teams as effectively as possible.
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