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Jun 18, 2013

IR Society conference round up

The IR Society conference received a shake up this year with new case studies and a services gameshow

After last year’s focus on the macro picture and debt relations, the IR Society responded to audience feedback and focused its 2013 annual conference more squarely on the role of investor relations.

The one-day event, held again at Kings Place by London’s Regent’s Canal, included a series of corporate case studies, plus an innovative gameshow session where teams of IROs and service providers debated why a hypothetical budget increase should be spent on one area or another.

The conference kicked off in the traditional manner, however, with a keynote speaker discussing the evolving nature of markets and IR. Sir Nigel Rudd, chairman of Invensys and non-executive chairman of BAA and Pendragon, said back in 1982 – when he founded the industrials holding company Williams – insider trading had only just become ‘mildly illegal’.

‘The demands placed on the investor relations function now require a much broader base of skills than ever before… investor relations truly is a profession all of its own,’ he said at this year’s conference.

Global investment trends

Another regular fixture came in the form of BBC business journalist Evan Davis, who once again moderated the day’s proceedings. His first task was to compere a panel discussion on the increasingly global nature of fund management.

Patrick Bowes, head of external communications and IR at Old Mutual Group, said UK ownership of his company, which is listed in London as well as Johannesburg, has substantially reduced. ‘The internationalization… is absolutely happening, and it’s happening at a fast pace, perhaps faster at the larger cap end,’ he stated.

Adding color to this trend, Will Tovey, managing director of Barclays, noted that independent investment bank Lazard now only holds London office meetings in the afternoon – to let US colleagues join in. That’s an interesting change at Lazard, as you never used to have a meeting in the afternoon, quipped Davis.

After a coffee break came the corporate case studies, featuring BP, Nestlé, Vodafone and Lloyds Banking Group. The latter, today owned 39 percent by the UK government thanks to a 2008 bailout, discussed how it has rebuilt trust with stakeholders, especially investors and analysts. ‘We’re rapidly on our way to becoming normal again, thank goodness,’ said Charles King, director of IR.

During the Q&A, Lloyds discussed how much access to divisional managers it gives to the buy side, an area where it has opened up as conditions improve.

‘Having those divisional contacts in the market three to three-and-a-half years ago wouldn’t have been the right time; at that time it was about the survival of the group as a whole,’ commented Lloyds’ Douglas Radcliffe, who is responsible for operations and reporting within the IR team. As the capital position has improved along with results, the market now wants ‘to understand the underlying group performance,’ he explained, making meetings with divisional heads more useful.

Access and argument

Given the focus on corporate access in the UK – where the regulators are clamping down on payments via trading commissions – there was plenty of interest in what David Lawton, director of markets at the Financial Conduct Authority, would have to say in the post-lunch keynote. Lawton offered little new on the topic, however, despite repeated questioning from the audience on many aspects of the corporate access debate.

Next came the gameshow session: three teams took in in turns to encourage the audience to allocate a hypothetical 10 percent budget increase to digital communications, corporate reporting or shareholder analysis and targeting.

Rupen Shah, head of IR at Britvic, stole the show and most of the votes with a gag-strewn but earnest pitch on the importance of the third option. ‘I would heavily argue… shareholder analysis and targeting is your GPS system,’ he said. ‘You should not – and cannot – do your jobs without it.’

A final panel discussion tackled key governance challenges for IR over the next 12 months, before Helena Morrissey, CEO of Newton Investment Management and founder of The 30% Club, which pushes for more women on UK boards, delivered the final keynote of the day.