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Introduction
The definition adopted by the National investor Relations Institute
states that investor relations (IR) is a strategic management responsibility
using the disciplines of finance, communication, and marketing to
manage the content and flow of company information to financial
and other constituencies to maximise relative valuation.
Development and Practice of Investor Relations
There has been an upward trend in the number of companies seeking
an Initial Public Offering (IPO) and also in the participation of
stock markets by both individual and institutional investors. Besides,
with the increasing need for businesses to raise capital both locally
and internationally has indeed created a catalytic effect on the
development of businesses to attract and retain the interest of
investors not only in their stocks but also in their companies.
As a result, the role of Investor Relations Practitioners (IRPs)
become increasingly important, if not, critical.
IR has, in recent years, sprang into more vital
prominence, with more organisations establishing IR positions or
expanding existing departments to undertake the demands for better
relations with the investment community.
There are several factors that contribute to this
surge in demand for IR Practitioners (IRPs).
- Increase in the number of companies whose shares
are held by the public and institutional investors.
- Growing need for businesses to raise capital
to meet increasing competition and to finance growth.
- Sophistication of financial analysts and their
increasing concentration on larger companies.
- Sharp rise in the role of institutional investors
- banks, insurance companies, fund managers - and their emphasis
on disclosure and full valuation of shares.
- Demands for better management performance that
is translatd into higher share prices.
- More stringent requirements for disclosure
of information by SGX.
- Expanding importance of foreign financial markets
for financing local business and industry.
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