By Staff Reporter
INVESTORS are the back-bone of any capital market. They not only determine the level of activity in the capital market but also inform the level of activity in the economy. It is imperative for the healthy growth of the economy that investors’ confidence in the market is maintained.
There exists a need to cultivate investor knowledge in the marketplace by ensuring an understanding of the investing public in the rights and obligations of the investors and the companies in which they invest.
Pretty much any company you’ve ever heard of has investors to thank for not only getting on their feet but also for the continuation of their operational success.
Thus, it’s important for businesses to communicate effectively and honestly with investors. Investors are not disinterested pots of money rather, if they invest in a company, they want that company to succeed.
Indeed, they have a vested interest in that company and its success. Investors need to be treated as advocates and resources. They need to be kept informed of developments. Too often, investors are only approached when a company needs more money. This should not be the case.
Consistent investor communications and relationship building is a must if capital markets are to fully play their role of lubricating the economy.
Consistent and thorough investor communications have a number of important advantages, including forcing accountability. Investor relations and communications, such as monthly and quarterly reports, will keep capital market intermediaries accountable to themselves and to investors.
Further, it encourages evaluation. The reporting components of investor communications ensure that the whole capital market eco- system is consistently evaluating themselves.
Strong investor relations make it more likely that an investor will be able to identify potential areas of growth, partnerships, or new business angles. Companies benefit when investors are active advocates for them and can use their relationships to help the company.
Moreso, a record of strong investor relations and a documented history of the capital market performance, as outlined in listing rules of investor communications, will attract new investors.
One concept that plays a critical role in investors communications is the investors day. Also known in some markets as an “analyst day,” an investor day is a public meeting, where presentations are made by the various capital market intermediaries and policy makers in front of a live audience, for the purpose of updating the public on the health and direction of the capital markets.
Investors and analyst are present to ask questions. An investor day can be used to weave a compelling narrative about corporate health, culture, and vision of the capital markets and the opportunities available for investors.
For the first time in the history of Zimbabwe’s capital markets C-TRADE has planned an Inaugural Investor Day Conference meant to bring together a cross-spectrum of current and potential investors.
This is intended to be an annual event that every investor in the Zimbabwe capital markets shall look forward to given its structure. With financial exclusion reported at 99% by the Finmark Trust, the investor day is planned to promote the financial inclusion drive by invigorating the activity on the country’s stock market.
This initiative also seeks to promote interaction amongst investors, issuers, policymakers development partners and capital market intermediaries to promote dialogue amongst all participants in the whole eco-system.