What is Investor Relations and what does it mean? 

Here we tell you everything you need to know about investor relations (IR), such as what it is and why it's important to look after your investor relations. 

What is investor relations?

Investor relations is a function within a company that is responsible for the relationship between the company and its investors. Investor relations is important to provide all external stakeholders, such as shareholders, venture capitalists and lenders, with clear information regarding the company's strategy, finances and future plans, among other things. 

If a company manages its investment relations function, investors will have more confidence in it and the market will get a fair picture of its activities.

What is included in investor relations?

Below we outline the activities and strategies that are most important in investor relations. 

Have good communication with investors

Investors should be provided with easily accessible information on all aspects of the company. Investors normally receive this information through press releases, annual reports, quarterly reports, etc. Ideally, all information related to the company should be easily accessible and in an understandable format. 

Managing external expectations

In principle, all companies benefit from managing the expectations placed on them by the market. This is best done by being straightforward and honest in its communication, thus reducing uncertainty and large fluctuations in the share price. 

Media management

Managing relations with the media, such as journalists and analysts, is an important part of IR. Thus, investor relations professionals must provide accurate and timely information to the media in order to build a high level of trust with them. 

Legal information

Listed companies in Sweden must comply with the requirements of authorities such as the Swedish Financial Supervisory Authority. So an important function of investor relations is to ensure that the company complies with all the rules that exist to counter insider trading and money laundering, among other things. 

Frequently asked questions

Are IR and shareholder communication the same thing? 

No, investor relations and shareholder communication are not the same thing, even though they "go into" each other. Shareholder communication is about giving shareholders all the information they need about, for example, finances and future strategies. IR is a broader concept that includes more stakeholders such as potential investors, analysts and the media. 

Why is IR important?

IR is important for a number of reasons, including the fact that good IR work creates long-term trust with key stakeholders and a stable share price. 

What does an IR team do? 

An IR team manages communication with all key stakeholders such as potential investors and shareholders. Examples of practical tasks an IT team helps with include publishing financial reports and communicating with the media.

What is an IR strategy? 

An IR strategy is a detailed plan and the actual actions that a company takes to communicate with its financial stakeholders, such as shareholders and potential investors, in an ideal way. A well-executed IR strategy is essential for the company to reduce uncertainty and maximize its opportunity to find new investors. 

What are the positive effects of good IR work? 

Good investor relations work has positive effects such as a more stable share price, reduced uncertainty among external stakeholders and a better understanding of how the company works and what its strategies are. 

Why can share prices be boosted by good IR work? 

Good IR work can stabilize, and sometimes strengthen, the share price by minimizing uncertainty from external actors through its IR work. Uncertainty about how the company will perform in the future is a typical factor that results in a constantly changing or declining share price. 

Is investor relations the same as PR?

No, investor relations is not the same as public relations. IR is about communicating with investors and the stock market at large, while PR is mainly about managing the company's image with individuals and the media. 

What rules and laws must an IR team follow? 

An IR team must follow all the rules and laws that the company must comply with, such as national laws and the rules set by the stock market if the company is listed. Examples of laws and regulations a company must comply with are insider trading laws, money laundering laws and stock exchange transparency requirements.