Institutional investors globally remain skeptical but recognize growing
importance of social media
TORONTO and MONTREAL, Jan. 21, 2014 /CNW/ - In a new global survey, a
majority of institutional investors around the world said social media
will grow in importance as an investor relations tool, even though
seldom consulted today by investment professionals.
According to data compiled by NATIONAL Public Relations and the AMO
network of financial communications agencies, 56 per cent of
institutional investors surveyed said that they consider social media
to be "not yet significant but growing in importance" as a professional
tool for investors.
Over a third (37 per cent) said that social media - including investment
forums and blogs - were a welcome innovation making news dissemination
more direct and rapid. And 33 per cent also said that they consider
such sites to be a useful "heads up", especially during exceptional
times such as takeover bids or proxy fights.
Asked which sites they visit most often for professional purposes, those
interviewed indicated investment forums (39 per cent said frequently or
very frequently), followed by LinkedIn (34 per cent) and investment and
financial services blogs (32 per cent). Only 22 per cent said they
consulted Twitter frequently or very frequently for professional
purposes, compared with 10 per cent for Facebook.
A clear majority of the institutional investors surveyed said they
considered the main newswires to still be their main source of investor
information, consulted very frequently by 76 per cent of investors. The
investors who were surveyed consistently ranked the newswires as more
reliable than other news sources such as newspapers, radio & TV or
social media. 87 per cent said the newswires were always or usually
reliable, compared with just 17 per cent for social media sites.
But even if they do not consult the sites often or find them reliable,
only a small number of the investors dismissed social media outright,
with just 17 per cent describing it as irrelevant to their work.
The new survey, which covered 105 institutional investors in 12
countries managing a total US$3.83 trillion, was carried out by the AMO
network to help investor relations executives at listed companies
determine how to adapt their IR strategies to the digital age.
"The AMO survey shows that investor relations professionals should be
examining how to incorporate or expand their social media capabilities
to reach institutional investors. Today, investors are skeptical of the
value of the information conveyed using these tools but there is
widespread recognition that they will become increasingly important,"
said Peter Block, Practice Lead of NATIONAL's Financial Communications
group in Toronto.
"Social media need not be intimidating, excessively time consuming or a
risk of violating securities rules. It should be viewed as an extension
of an IR program, which already responds to inquiries and engages in
discussions with its investors."
In fact, social media can be particularly beneficial for small to
mid-sized companies which traditionally have more difficulty getting
the attention of analysts and mainstream media. A recent University of
Michigan and Stanford University study found that dissemination of news
via Twitter was associated with lower bid-ask spreads and enhanced
"We know many IR professionals in Canada are already using a wide range
of social media tools to reach investors. Those that are not should see
the AMO results as a call to action," concluded Peter Block.
AMO is the leading global network of strategic and financial
communications consultancies. Our 'best in class' philosophy brings
together local market leaders with unrivalled knowledge of financial
markets and cross-border transactions in the key financial centers of
Europe, Asia and the Americas. Providing sophisticated communications
counsel for M&A and capital market transactions, media relations,
investor relations and corporate crises, our member firms have
established relationships with many S&P 500, FTSE 100, DAX 30, SMI, CAC
40 and IBEX 35 companies. www.amo-global.com.
With more than 940 professionals operating globally for our clients, AMO
is comprised of the following market-leading network members:
The Abernathy MacGregor Group in the US
NATIONAL Public Relations in Canada
Maitland in the UK
Havas Worldwide Paris in France, Belgium and Dubai
HERING SCHUPPENER in Germany
LLORENTE & CUENCA in Spain, Portugal and Latin America
Hirzel.Neef.Schmid.Counselors in Switzerland
SPJ in the Netherlands
Porda Havas in China
Ad Hoc Communication Advisors in Italy
NBS Communications in Poland
Hallvarsson & Halvarsson in Sweden
About NATIONAL Public Relations
NATIONAL Public Relations is the largest public relations consultancy in
Canada with offices in Victoria, Vancouver, Calgary, Toronto, Ottawa,
Montreal, Quebec City, Saint John, Halifax, St. John's, New York and
London. The Firm serves leading corporate, government and institutional
clients and offers the full range of communications services, including
corporate communications, investor relations, public affairs, employee
engagement, public consultation and participation, marketing,
technology and healthcare communications, as well as digital
communications. It provides medical communications, public relations
and clinical trial support services to a wide section of the leading
pharmaceutical and medical devices companies internationally under the
name AXON Communications. NATIONAL is a subsidiary of RES PUBLICA
Consulting Group. www.national.ca
SOURCE: NATIONAL Public Relations - Toronto
For further information:
NATIONAL Public Relations