Artificial intelligence (AI) is a tool for IROs and not a replacement for human interaction, said Victoria Hyde-Dunn, vice president of IR at Informatica, speaking to IR Magazine at the NIRI 2023 Annual Conference in Chicago.
Hyde-Dunn, an IR Magazine Award-winner who has worked in IR across large and small-cap US companies, said IR teams have plenty to be optimistic about when it comes to AI.
‘There’s definitely risks associated with the world wide web, ChatGPT and so on and so forth,’ she said. ‘But there’s a lot of useful content you can derive from there. AI is great for searching. It’s great for putting together a report and having three or four summaries that you can then pass on to your management team.
‘It can help with sentiment analysis. What were the key words you said this quarter compared with the last three or four quarters? Did your sentiment improve? Did it go down? How was the tone of your call?
‘So AI is here to stay. It’s a hot topic. I think from the Wall Street perspective, [people are] also looking at it from an investment thesis [basis]. Which companies and sectors are going to be the winners in AI? And if you’re not doing anything with generative AI or don’t have an AI-type strategy, you’ll need to have one.’
Privacy and recession concerns
Hyde-Dunn predicted that future AI tools will have a greater focus on privacy and will therefore be of greater use to IR teams.
‘I think the future won’t be a public AI-type environment because of all the risks associated with having public, sensitive information out there,’ she said. ‘I think it’ll be contained within four walls, within a corporate environment where there’s privacy, less risk, more security, and so on. And that’ll be great for IROs to be able to use.’
Aside from AI, another big talking point at NIRI has been the uncertain macroeconomic picture, said Hyde-Dunn.
‘We as IROs need to continue to be prepared for a potential recession that the economist [speaking at the conference] said is an 80 percent probability in the next 12-18 months. I’ve heard that from other bankers as well as economists,’ she said.
‘We need to be prepared in case we do go into a recession, even if it is mild. So what does that mean? It means having a strategy in place, having a crisis communication plan in place, or refreshing [one], having your targeting list updated or refreshed and, more importantly, continuing to elevate the importance of investor relations and be a strategic adviser within the organization.’