Benchmarking your IR Program

Feb 2025

Benchmarking the success of an IR program can depend on a number of factors, including market cap, industry, stability of financial metrics, and a management team’s support of the function. Once aligned with management on the objectives of the program, an IRO needs to ensure that the appropriate qualitative and quantitative metrics are tracked to demonstrate the program’s value add.  You’ll gather this information from all sorts of different stakeholders and channels, both internal and external.

Metrics to Benchmark IR Programs

Many IROs focus on achieving long-term valuation targets and on lowering stock volatility compared to their peer groups. Many departments consider a mix of qualitative and non-quantitative measures to measure progress. According to a NIRI National survey, 81 percent of IROs use at least one IR metric to measure their IR program’s success. Some of the metrics cited included the number of meetings in a year, analyst coverage, quality of shareholder base, peer valuations, and Wall Street message retention.

Communicating for Success

It is important that IROs optimally communicate their IR results internally to show progress on the IR goals. Both your board and your management team should get weekly, monthly, and quarterly reports benchmarking the IR program, in addition to frequent internal communication. I highly recommend participating in weekly executive staff meetings to keep executives up to date on key metrics, as well as to provide Wall Street feedback on the company and space. Many IROs also communicate to the Board via a quarterly report or present Wall Street sentiment, progress or other strategic initiatives.

Getting Feedback from the Street

While it’s important to benchmark your IR program, it’s also imperative that companies seek feedback from Wall Street on how your IR program is perceived; informal investor feedback should always be folded in. Many companies commission my team to conduct a yearly third-party perception report. Think of benchmarking as a critical way to demonstrate IR as a strategic business partner, and as the entity that pulls the levers to favorably influence external impressions of the organization.

Data you gather from perception studies can be instrumental in keeping your team apprised of Wall Street sentiment. Further, tracking sell-side research and ensuring that there is a strong message pickup from the reports is another form of measurement.

Whether the focus is on qualitative metrics like message uptake or quantitative metrics such as long-term valuation or volatility, measuring the performance of an IR department is an indispensable tool for IROs. By aligning with management on goals and objectives, an IRO can identify and track the appropriate measures for their industry and market cap to drive long-term success.