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Aug 31, 1995

A Fair Exchange

Everything you always wanted to know about IR - but were too shy to ask

People who know me know that I love what I do. It is terrifically exciting and enormously satisfying to be involved in investor relations at a time when the rapid globalisation of the capital markets is creating new challenges and opportunities on a daily basis. I would not trade my choice of profession for any other - on most days - and today must be a good day.

Nevertheless, there are times when where I am is not where I would choose to be, were the choice mine to make freely. This was true at the time when I sat down to work on this article. Here in New England, it is the peak of summer and my garden is in full bloom. In this mood, sitting in my office working on my PC was not my first choice for where to be and what to be doing. So I turned to the greatest of all management techniques - delegation - and faxed my IR colleagues around the world to help me out by telling me what to write. What follows is largely their input.

Several people answered that they would like to see an article entitled: Tried and True Ways of Guaranteeing that Analysts Will Listen to You and Recommend Immediate Purchase of Your Stock in Large Quantities. Although this may seem a daunting task, in the right circumstances it is feasible. To create these optimal conditions, it is merely necessary that your company find a cure for Aids; develop artificial intelligence so that all personnel may be eliminated (except for the investor relations department, of course); uncover a commercial solution to world hunger; or just invent a better mousetrap.

Given that these measures may take some time, the German IR contingent has suggested printing some entertainment tips, which might be more useful in the near-term. Klaus Jessen of BASF, Hans Richard Schmitz of Abteilung Berichtswesen and their colleagues at the Deutscher Investor Relations Kreis are right now finalising the details for the upcoming International Investor Relations Conference which will take place near Frankfurt on September 11 & 12.

In addition to the events organised in conjunction with the conference, they also want to point out to any car-buffs that an international automobile exhibition will start in Frankfurt just after the IR conference ends. For those of you who live in Europe, this might be the chance to pick up a new Lamborghini for the ride home.

For a less racy adventure, Klaus Jessen recommends the Sachsenhausen district of Frankfurt - a charming part of the city, famous for its restaurants. One specialty of the area is Appelwoi, which is a kind of apple wine. The French know this beverage as cidre but we in the US have no equivalent, surely to our loss. Jessen recommends this wine for those who need an exercise in faith: he says that while drinking the first couple of glasses the drinker has to believe that the taste of the wine will begin to improve. It inevitably does so, Jessen assures us, usually around the fourth glass.

In addition to entertainment tips, I also received suggestions for new travel articles. Several of our colleagues requested articles offering helpful hints on various aspects of business travel, all of which could be distilled into one article entitled: How to Fly a Million Miles Without Losing Your Luggage - or Your Sanity.

Another idea came from Annabel Cotton who is with Telecom Corporation of New Zealand. She proposes an article on the psychological influences on geography to explain Why Some People Think it is So Much Easier for Her to Make the Trip to See Them Than it is for Them to Come to New Zealand to See Her. By the way, Cotton also told me that another company in New Zealand has decided to start an investor relations department, which brings to five the number of companies with internal investor relations operations in the country. At this rate, it will not be long before we can look forward to welcoming a New Zealand IR society to our international family.

On the subject of local IR societies, I am happy to report that both Norway and South Africa answered my call for help with news of their progress in forming local groups. Lisbeth Lindberg of Orkla reports that in Norway, where IR professionals have been meeting on an informal basis for well over a year, they have decided to form an official society. This will serve to formalise the structure and underline the importance of IR in the country. They are now working their way through the necessary considerations, including how to attract members, how often to have meetings and what to include in the society's by-laws.

In South Africa, a country whose re-entry into the global investment community has been gathering momentum, local investor relations professionals held their first meeting at the end of June. Hosted by Amelia Soares of Sasol Ltd, ten members of the South African IR community met on June 27. Although their numbers were reduced by a strain of 'flu making the rounds, they decided to meet officially every quarter and to host lunches when international IR specialists are in the country.

People in both these countries now in the process of starting IR societies would be interested in another article that has been much requested: How to Communicate Effectively with that Segment of the Human Race Called Analysts Who, Though Rarely Dumb, Are Selectively Deaf to Your Presentations and Blind to Your Handouts. The research for this article is now in progress and will, I suspect, remain so.

One serious topic which came from my appeal for help with this article was suggested by Neil Ryder of Sage Partners in London. He proposed a study of corporate stock ownership in continental Europe and the ability of companies to discern who owns their shares and those of their peer groups. Laws and practices differ significantly from country to country but nowhere on the continent do companies have the type of ownership information that US companies receive regularly. In fact, in some European countries, companies have no access to ownership information beyond the street-name level. It is certainly legitimate to ask how companies can be held responsible to shareholders they cannot identify. And I agree that this is an interesting topic which merits further study.

The final article I want to propose is my own suggestion. It is called: Why is it That the Worst Thing That Can Happen is That You Get What You Ask For; or How We Wanted Better Information Faster and Ended Up With Information Overload and What Do We Do Now? I have been working on this topic for some time but I am afraid that I do not yet have an answer to the problem. If anyone reading this article does, I would gladly give them this space next month to publish the solution. In fact, I would offer them this article space, my PC, my office, my wooden swing, my Claritin pen and the best blooms from my garden.

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