Here is a communications conundrum for you: should Rishi Sunak, the UK prime minister, have called an election while standing in the pouring rain?
The decision meant images of a sodden premier were viewed by millions of voters and splashed (no pun intended) over newspaper front pages the following day. ‘Drown and out’ was one of the less-friendly headlines.
It’s traditional for the UK leader to make big announcements on the Downing Street pavement but, given the dodgy state of the weather, sticking to an internal briefing room might have been the better option.
Perhaps Sunak’s advisers thought sending their man out amid a downpour would make him look steely and determined. Many communications professionals, however, labeled the decision a major misstep at the start of the election campaign. At least get the man an umbrella, they said.
Elections throw up a different set of challenges for IR teams. The level of uncertainty among market participants ratchets up, complicating the story you are trying to tell investors and analysts. Companies are also more likely to be asked about political issues and outcomes, which are often areas you would rather not comment on.
In fact, more businesses than ever are likely to be fielding politics-related questions this year. As has often been commented, 2024 will see nearly half the world’s population go to the polls, including in major economies like the US, India and the EU.
How should IR teams respond? One of the common pieces of advice, which we hear regularly at our think tanks, is that companies shouldn’t try to be political experts. Investors will have plenty of advice from other sources on these issues.
Instead, the best thing issuers can do is stick to what they know, which is talking about fundamentals, long-term vision, competitive advantages and why the business should perform regardless of which party is in power. Of course, it depends on the industry. Some sectors, such as defense, are more reliant on government contracts or policies, meaning engaging in conversations about different scenarios is more important.
A recent poll backs up the idea that elections don’t tend to have a significant impact on most IR teams. When asked to rank the importance of a range of macro and political issues to their company over the next year, IROs put national and international elections third to last, with economic subjects like inflation, central bank policy and energy prices coming out on top.
What impact are upcoming elections having on your IR planning? And would you have sent Sunak out in the rain? Get in touch and let us know at [email protected] or on LinkedIn.
