For many IR professionals, the first half of 2020 felt like a blur: the transition to remote working, a scramble to host a virtual annual meeting, a stock market crash and the withdrawal of guidance. Even so, 50 percent of attendees at a recent IR Magazine Webinar expect to participate in more investor meetings during the first half of 2021 than the first half of 2020.
A further 42 percent expect to maintain the same volume of investor meetings as this time last year. Only 7 percent anticipate a fall in investor meetings during the first half of 2021.
Before the pandemic, it was a corporate access maxim that institutional investors would be unlikely to buy a large amount of a company’s stock without meeting with the firm in person first, but the webinar panelists said this has been relaxed since the pandemic.
John Nunziati, investor relations partner at Q4, said that based on the Q4 surveillance team’s analysis, issuers are seeing roughly the same amount of churn in their top 30 shareholders list as they would have before the pandemic – with a healthy turnover of investors moving in and out of the top 30.
Karen King, senior vice president of investor relations and corporate affairs at Alcon, agreed that investors haven’t been held back by being unable to meet in person. ‘We’ve talked to a lot of new investors and we maybe start out with a phone call with IR and eventually get to a video call with management,’ she said. ‘We’ve had new investors come in. Historically it’s true that they like to look management in the eyes but I think, in this environment, you can do an effective call and it’s not a limitation for the investor.’
While virtual meetings have been effective for investor meetings, both King and Mark Kinarney, senior director of investor relations at Lantheus Holdings, explained that their management teams had been getting together – in a safe and socially distanced manner – for earnings calls.
‘We’ve picked a select number of activities to be together for in one physical location,’ King said. ‘We have done it for our earnings calls and we had a large conference recently we did it for…We have a big boardroom [where] we can be socially distanced. We follow the safety protocols: we’re masked, we’re distanced and we disinfect surfaces. But we’ve reached a place where we feel comfortable being in the same room again. And the advantages are that you can hold up notes for one another and make eye contact at key moments.’
That said, King said most corporate access events – including roadshows – have been held entirely remotely.
While it’s one thing to get together with a small management team that knows and trusts one another, it may be another to invite individual investors into offices for meetings at this point. During the webinar, the audience was asked which safeguards would need to be in place in order to meet with an investor at its offices. The responses were as follows:
- Only meeting with local investors (no flights or public transport) – 4 percent
- Everyone at the meeting has received the vaccine – 8 percent
- A large, well-ventilated meeting room – 14 percent
- All of the above – 17 percent
- I wouldn’t take the meeting – 54 percent.
As more people receive the Covid-19 vaccine and cases fall, it raises the question of when we can expect to see a return to in-person meetings. A number of investment banks have scheduled in-person events for the second half of the year but only 23 percent of the webinar audience expect to return to in-person meetings in the second half of 2021, while 53 percent of respondents said they’re not sure.
Nunziati said that even in situations where the management team may be willing to participate in an in-person event later this year, it could be a board governance issue. ‘From a risk-management perspective, it’s hard to imagine that if you’re proposing to take your CEO to a conference in September, there wouldn’t be some discussion at the CEO staff level – or perhaps even board level – to assess what the risks are and what safeguarding measures are in place.’
IR Magazine recently spoke to Marcus Driller, vice president of corporate at Fisher & Paykel Healthcare in New Zealand, for an insight into what the future of corporate access may hold. He described the detailed contract-tracing measures his firm is taking.
