Winter Is Coming. Is Your CEO Prepared?

Winter Is Coming. Is Your CEO Prepared?

by Michael Rosen, Director, Capital Markets Engagement, CEO Investor Forum, CECP

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Winter is coming for shareholder capitalism. Is your CEO prepared to communicate long-term strategy to investors and key stakeholders? New blog from @CECPtweets: https://cecp.me/2Yr6Fcb
Tuesday, June 23, 2020 - 11:15am

Last week, I spoke on a NIRI Webinar, Leveraging the Power of Retail Investors: Your Company’s Invested Ambassadors. During the conversation, my fellow panelists and I delved into the challenges and opportunities faced by Investor Relations Officers (IROs) seeking to engage with this critical stakeholder group and explored the context and reasons why the retail investor will continue to become an increasingly important stakeholder for issuers. This discussion had a direct connection to my team’s work at the CEO Investor Forum. As a recovering sell side Corporate Access professional, I now help the IR community prepare for a coming paradigm shift in the capital markets. 

The foundation for this new paradigm has been building for years. As the next generation continues to play a more significant role in the economy, its expectations for companies and their role in society will inevitably change. The Purpose Generation, which already represents 50% of the U.S. workforce, believes business has a responsibility to be transparent about its values, make a positive contribution to society and align financial performance with its principles and corporate purpose. They are one of the fundamental drivers of the changing tide upending the sole focus of capital markets on just shareholders to now also include other key stakeholders. While there is early evidence that some companies are beginning to adjust their focus, today’s CEOs and IROs are not adequately prepared for this coming tsunami.

As this more just form of stakeholder capitalism takes hold, shareholders will continue to be one of the most critical stakeholders. However, corporate executives will also need to consider their strategy against a broader set of key stakeholders to deliver long-term value including employees, customers, suppliers and communities. As a result, the IR community will need to reassess its investor communications strategy, evolve its external engagement practices and identify the strategy that best balances the interests of all its key stakeholders.

 

Read the full post on the CECP Insights blog: https://cecp.me/2Yr6Fcb