Reputation | Street Talk | Dix & Eaton

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We've talked before about the intersection of IR and the media. While some of you scoffed... even smirked... many of you agreed that this intersection was one to pay close attention to. For those of you among the latter, I strongly encourage you to visit (more) - the new blog by the head of Dix & Eaton's media relations practice. For those utilizing financial media as a component of an IR strategy, (more) will help make sure your sights are set properly.

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Are You Ready When Turmoil Hits Home Overseas?

In light of the recent unrest in Egypt, my colleague, Matt Barkett, posed this very question in a piece he published last week. Interesting topic, to say the least - and one that got me thinking about the IRO's obligation to his/her organization during such periods of strife overseas.

The more I think about it the more this current situation in Egypt underscores for me just how critically important it is for an IRO to be involved in his/her company's global enterprise risk management strategy and execution. Among other things, by having a clear understanding how such global external forces are influencing the company's operations and - possibly - its financial performance and outlook, the IRO is properly informed to help educate investors and regulatory agencies as necessary should an event of significant magnitude take place. As we all know, timely disclosures and 'appropriately smart' transparency is key to mitigating the downside impact  - temporary or otherwise - of such conditions on a company's reputation and, ultimately, its valuation.

Agree? Disagree? What are you seeing in your organization?

(Confession time: I am growing increasingly concerned with the lack of discussion within the investor relations industry (online or otherwise) about IR's role in enterprise risk management... should I be afraid? And, more importantly, why aren't you?)

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Reputation and Valuation

Benjamin Franklin once said, "Glass, china, and reputation are easily cracked, and never mend well."

Warren Buffett said of reputation, "It takes 20 years to build a reputation and 5 minutes to ruin it."

And Sebastian Bach once observed, "Park Avenue leads to Skid Row."  

Sadly, it has been my experience that most IROs see reputation as the exclusive domain of their corporate communications colleagues. While I realize that some of this has to do with corporate structures (I was lucky - when I was on the corporate side, I had the luxury of overseeing both IR and corp comm*), I do think some of this resistance comes from the fact that IROs are increasingly coming into the position with a finance background rather than a communications background and, therefore, may not fully understand the direct relationship between reputation and valuation.

As you'll see in this piece by Business Insider, this is a relationship that all who contribute to their organization's investor relations effort must understand and appreciate.  In this case, what you don't know can hurt you.

* And, for the record, I still hate when people say, "When I was..." I hope you'll forgive me for this transgression. 

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