News and views

Reporting lines

Where does IR fit in the corporate sphere? To this end the Society recently polled our FTSE 100 members to find out who they reported into.* We found the following:

• 61% of FTSE 100 IR departments report to the CFO/FD

• 22% report to the Head of Corporate Communications or an equivalent

• 10% report to the CEO

• 7% report to another function.

These results show a number of interesting things: first of all the crucial strategic importance of IR in achieving company objectives and planning as demonstrated by the seniority of reporting lines; the continued consideration by a small majority of senior management that IR belongs within the wider finance environment; and the view from a significant minority that given the communicative remit of IR it should be placed within the overall corporate comms arena or indeed report directly into the CEO him/herself.

The IR Society feels that there can be no definitive answer to the optimum placement of IR within the business and each company must decide what works best given its own objectives and corporate structure. What we do say is this: Investor Relations is both an art and a science; qualitative as well as quantitative!

*From a response rate of 49 FTSE 100 companies.