When looking for an Investor Relations Officer, organizations typically start with three easy categories. They are: tenure, industry, and geography.
These three characteristics often represent both the company and candidate's home field advantage. These metrics are easy to use when operating from a limiting or exclusionary perspective. The problem is that these metrics really do not provide much insight into how well a candidate can do the job.
An overlooked but really important metric to consider in Investor Relations is trading experience.
What do I mean by trading experience?
Simply put, has the IRO or candidate had experience trading vast sums of money in capital markets?
Before you say this is an unfair metric, trading vast sums of money is relative. For a buy-sider this likely means millions of shares or millions of dollars. For a common investor this means several thousand shares to several thousand dollars.
Why does trading experience matter to Investor Relations?
If a candidate has actual trading experience then the candidate will be more likely to understand and show empathy to investors. I am sure many might think empathy for investors, are you crazy?
At the end to the day, if an IRO can have real empathy for the role of investor, the work involved, and the risks involved, the company will elevate its credibility and stature among the investment community. Being able to show empathy towards investors will help keep activists at bay, too
Instead of being a keep off the grass IRO think about being an empathetic IRO. The best way to build investor empathy involved being an active investor yourself.
If you are a keep off the grass IRO, remember the best way to control the narrative is to provide the answer to even the most tedious or seemingly idiotic question.
