This article was produced by ELITE Connect and originally published on the ELITE Connect platform
Measuring IR performance, both on an individual and team basis, can often be a challenge given the level to which external factors and internal issues can affect the function’s success. Ruban Chandran, head of IR at Severn Trent, gives us an insight into how he evaluates his team’s effectiveness and shares some top tips for optimizing performance.
Elite Connect: How do you currently measure IR performance within your team? What factors do you think external stakeholders evaluate you on?
Ruban Chandran: We measure it by the accuracy and tone of messages communicated as part of our half and full-year results presentations, the quality of our investor engagement through roadshows and one on ones, and the ability of the team to act as a sounding board to management on the key topics on the minds of investors. I suspect others assess the quality of the Severn Trent IR team on our business knowledge, the ability to provide access to management and our responsiveness to requests and queries.
EC: What are the main performance objectives you use to evaluate individuals’ performance?
RC: My team is typically assessed on two main categories: ‘what’ they do in terms of creativity, problem solving and judgment, and ‘how’ they do it in terms of demonstrating drive, empathy, resilience, intuition and tenacity.
EC: What about the objectives for the whole IR team’s performance – how do you assess group success?
RC: The IR team is assessed on the quality of engagement with existing holders (care and maintenance), underweight holders (by understanding why they are underweight and what can be done to change their position), and identifying pools of underused capital and targeting non-holders that have a potential to invest. It’s about creating a high-quality shareholder base. A tolerance for zero errors also counts when it comes to the content and cosmetics of external publications and presentations!
EC: How can IROs optimize their performance, both from an individual and a team perspective?
RC: By getting to know how the business works, staying abreast of investors’ key questions and by watching and listening to the content and style of the CEO and CFO in investor meetings, and asking oneself, ‘Could I do it that well in an IR one to one?’ From a team perspective, it’s vital to reward silent running and recognize not just the key IR communicators, but also team members who facilitate and organize logistics and activities that are less frontline in nature.
EC: What’s to gain from being an effective IRO?
RC: IR is generally a very fun place to be. Those who are existing practitioners will recognize the cerebral stimulation that comes from interacting with investors, sell-side analysts and management alike. Those who are new to IR should see these as exciting opportunities!
