The Role of Investor Relations and Good Corporate Governance on Firm Performance in the Case of the Companies Listed on the Bucharest Stock Exchange

The objective of this paper is to investigate the role of Investor Relations (IR) in the performance of companies listed on the Bucharest Stock Exchange. The study is motivated by the findings in the literature that investor relations may boost information disclosure, analyst following, institutional investor share, liquidity, and business valuation. The current article contributes to the relevant literature by making use of the recently released unique database of VEKTOR scores on company investor relations for 2019 and 2020. The main finding based on regression methodology shows that IR scores have a strong positive relationship with firm performance. Specifically, a one standard deviation rise in the IR score corresponds to a 2.6% rise in company ROA. Companies may be advised to strengthen their investor relations based on these findings about the beneficial role of investor relations.

Measuring investor relations and financial communication: an empirical test of scales of public relations

Models of public relations became one of the most researched paradigms in public relations. Yet, after their reconceptualization into dimensions, researchers focused on developing models/dimensions virtually disappeared. This study proposes to continue this research by reconceptualizing models/dimensions into the public relations scales. This paper reports the first empirical test of the Scales of Public Relations by applying them to one of PR specializations – investor relations.

U.S. Securities and Exchange Commission (SEC) brings regulation FD enforcement action against AT&T Inc.

Purpose To explain and analyze the U.S Securities and Exchange Commission’s complaint filed in the U.S. District Court for the Southern District of New York against AT&T Inc. alleging repeated violations of Regulation FD (Fair Disclosure), and against three of AT&T’s Investor Relations executives for aiding and abetting those violations. Design/Methodology/Approach Describes the SEC’s allegations and AT&T’s response and recommends practice points that issuers and their legal counsel can draw from the enforcement action. Findings The SEC’s suit against AT&T and its three IR executives serves as an important reminder that the SEC remains committed to ensuring the full and fair disclosure of information by issuers and is willing to litigate Regulation FD-based enforcement actions when it deems necessary. Practical Implications Every public company must develop systems to manage selective disclosure risks in its investor relations program. Originality/Value Practical guidance from experienced corporate governance, litigation, capital markets, securities enforcement and regulation lawyers.

Investor Relations, Engagement, and Shareholder Activism

A dedicated investor relations (IR) function facilitates direct and ongoing dialogue between management and shareholders. This paper examines whether this form of engagement mitigates activism that relies upon support from other shareholders. We find that IR engagement is associated with increased investor confidence in management and the board, as well as a lower likelihood of activism, with this deterrent effect becoming stronger when there are fewer frictions surrounding the development of mutual understanding and trust with investors. We also find that when firms do experience an activist campaign, firms with IR engagement have less costly and contentious campaigns, including a lower likelihood of CEO turnover, than those without such a commitment. Taken together, our findings suggest that direct and ongoing IR engagement is an important factor in achieving mutual understanding and trust between the firm and its shareholders, which deters activist investors and mitigates the costly escalation of initiated campaigns.