Coordinating Investor and Public Relations

Originally Published MX July/August 2006

BUSINESS PLANNING & TECHNOLOGY DEVELOPMENT

In medical device companies, investor relations (IR) and public relations (PR) both serve important needs, but the line at which one function ends and the other begins is often blurred.

"IR is concerned with marketing the investment proposition and ensuring that disclosure obligations are met and, in particular, that analysts and shareholders get the right message," says Andy Burrows, director of investor relations for medical technology development firm BTG plc (London). "PR generally does not get involved in briefing financial analysts or meeting investors. The overlap is usually in dealing with the media, and close cooperation is required to ensure that business and financial journalists are provided with the same messaging as industry and specialist journalists.

Douglas Sherk, founder and CEO of Enhanced Valuation Communications (EVC) Group (San Francisco), agrees. "There is a line, and it should keep the crafting of messages directed to the financial markets, investors, and shareholders—as well as counseling management on how to disclose and communicate material developments—in the hands of the IR counselor," he says.

"Having said that, the two functions do overlap, especially in terms of the overall positioning of the company-how the company is distinguished, what its market opportunity is, and so on," Sherk adds. "For instance, a well-executed financial media function that communicates the messages crafted by management and its IR counterparts can support a company's IR goals by securing stories in the financial and business press that underscore the company's key messages. Through third-party endorsement in objective media, PR can reinforce the messages IR is taking directly to investors. Both market to the same audience, just through different channels."

In light of the overlap between IR and PR functions, coordination is key. "Regular monthly meetings between IR and PR, including any agencies, are a good thing," Burrows says. "There will be times when PR is unaware of corporate activities around which IR is planning investor communications, and sometimes the first PR hears of them is when the regulatory disclosure is made. This can create tensions but can be managed through good communications."

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