COVID-19: Tips for Communicating with Investors in a Turbulent Market

COVID-19 continues to dominate headlines with considerable impact on companies, Wall Street, nations, and increasingly the global economy. According to a report by Dun & Bradstreet, as reported in Bloomberg, “94% of Fortune 1,000 companies are experiencing supply chain delays – not to mention workplace absences, lower productivity, travel cutbacks, and reduced trade and investment.”

We have counseled countless clients over the years about communicating with investors in turbulent markets. Here are 5 tips to consider:

1. Our team has been through major market corrections and experience tells us that steady hands and cool heads prevail. Impulsive reactions are not likely to comfort concerned analysts, investors or other stakeholders. Investor confidence in the markets will only be restored over time.

2. Many trade and investor conferences are being canceled or switching to a virtual format. Many of our clients and the investors and analysts we work with have restricted travel. Some of our clients have also canceled or postponed large-scale investor and customer events. Remember that credibility is earned by consistently communicating in good times and bad. Keep the lines of communication open and continue to provide investors, analysts and others with consistent and credible information. Consider alternate forms of communication – telephone or video conferencing.

3. Investors are more focused on mitigating risk than finding immediate upside right now. Be forthright about your risks, the systems you have in place to monitor risk and any contingency plans. If you have managed through a period of significant market volatility in the past, explain to investors how you did it and what you learned.

4. Emphasize your core business strategies and focus investors on why your business is viable for the long term, not just next quarter. Remind them of what is both in and out of your control.

5. In times of uncertainty, more communication is always better than less. Don’t forget to communicate with all your stakeholders – employees, customers and partners, and let your Board know you’ve got it handled.

As always, we look forward to assisting our clients with strategy, advice and communications materials specific to this issue.