Reversal of Fortune: The Emerging Importance of Investor Relations

August 2022

“I’ve been with the company 32 years. You’d think they’d give me a nice, easy job at my age. Instead, they made me Head of Investor Relations – the goddamn hardest role I’ve ever had!”

The Wheel of Fortune Reversed!

For many years, Investor Relations (IR) was every global firm’s forgotten function.

If businesspeople thought about IR at all, they usually assumed it was some sort of glorified comms job, a necessary buffer between an overworked Finance team and information hungry investors. There was certainly little glamour attached to the role. For the average Head of IR, access to ExCo was limited, direct reports were few and pay was unremarkable. And one thing was for sure . . . IR provided no steppingstone to any of those coveted Board- level roles.

But that’s all changing. Today’s Head of IR is a strategist. He or she works hand-in-glove with the CEO and is often one of the first names mentioned when other C-suite roles become available.

So what has led to IR’s happy reversal of fortunes? Our resources point to activist investors, increasing ESG-related pressures and a global technology transformation which has forced companies to react to ever increasing amounts of data.

Nowhere are these trends more evident than the Oil & Gas sector.

WhiteCrow Research’s Latest White Paper

WhiteCrow Research’s latest white paper examines some of the precise challenges facing heads of IR in oil & gas firms and oilfield services providers. We also discuss the fast- evolving skillset that heads of IR must now showcase in order to be truly successful. Lastly, we look at the IR talent pool and discuss the feasibility of an energy or energy-related business hiring someone from out of sector giving rise to importance of Investor Relations (IR).

Important Highlights

  1. The balance between environmental sustainability and financial sustainability has never been more precarious. But now that energy prices are rising, some investors are sounding a slightly different note on ESG.
  2. Technology is a game-changer. Perhaps its most under-reported effect is the need to maintain constant trust with stakeholders.
  3. It is increasingly implausible for a Head of IR not to have a background in Finance. The role is now deeply entrenched in commercial strategy and often acts as a steppingstone to a CFO role.
  4. The Head of IR should report to the CFO but regular, strategic-level interaction with the CEO is crucial.
  5. The only out-of-sector IR talent pools that provide strong, relevant candidates for energy related companies are metals & mining and (possibly) financial services.

Challenges to World’s Energy Supply

As the graphics on this page display, an overwhelming majority of our sources named ESG as the biggest challenge they face in their professional lives. This is perhaps no surprise. With the current incumbent of the White House having been elected on a promise to “end fossil fuel”, there is clearly much work to be done to convince investors that oil and gas firms have a key role to play in the energy transition.

What is your biggest professional challenge?
Bar Graph - Biggest challenge to Reversal of Fortune
Fig 1A: All mentioned
Dounut Graph First mentions (%) - The Emerging Importance of Investor Relations
Fig 1B: First mentions (%)

True, some sources noted with satisfaction the new realism which has emerged since Russia’s invasion of Ukraine, but others were of the opinion that public memory is short: in the event that the world’s energy supply problems are resolved, they reckon it won’t be long before oil & gas firms are once again perceived as the ‘bad guys’.

Accordingly, heads of IR must continue to weigh their words carefully, balancing concern for the environment (innovation, clean technology) with a smartly articulated argument in favour of traditional energy sources. One of the people we spoke to – the head of IR at a supermajor – was reassuringly bullish about this challenge:

“ . . . the Venn diagram between ESG and arguing for a fossil future isn’t as bleak as you might think. The overlapping area is quite large. The key is to show investors that you get their concerns. Best advice I ever got given in this role was “Seek first to listen . . .”

Other sources struck a more despondent note, with one bemoaning investors’ “cognitive dissonance” and despairing that the market can ever have a “sensible, grown-up conversation” about ESG:

“Look, we’re lightyears away from having the technological knowhow to build a workable grid purely from renewables. Everybody knows that. And then there’s a massive question around how environmentally friendly renewables actually are when you take into account the land footprint and the rare metals and all the rest of it . . . But the ESG lobby is still, you know, “faster, faster, faster” . . .”

Ranking second among IR professionals’ concerns is technology. This requires some explanation. Our sources were not Luddites complaining of an inability to work the company intranet. Rather, they were referring to the huge volumes of data available to institutional and retail investors and the public at large. This subjects oil and gas firms to constant scrutiny. One source summed it up neatly:

“Twenty years ago, you only felt the full glare of public scrutiny once every quarter. Now you’re responding to events the whole time.”

But some sources acknowledged that technology is as much a blessing as a curse. Leveraging data is key to understanding an increasingly broad investor base, not all of whom necessarily take an identical view of each issue. IR heads can also use technology to keep abreast of hot button topics and track the activities of their competitors. However, this is all time-consuming. Indeed, some sources suggest big data is one of the reasons that IR teams are getting larger. As one person put it:

“If I had to do all the data gathering myself, I’d never do anything else. Any serious IR head needs to be building people around them.”

Our top two challenges – ESG and technology – would probably be namechecked by IR professionals in any sector. However, the third placed challenge is surely more specific to oil and gas: volatility. A cursory glance at energy prices over the last few years shows a dizzying, rollercoaster inconsistency. But against this topsy-turvy backdrop, IR heads need to maintain a consistent and coherent message. This touches not just upon a company’s long-term financial stability but also its strategy concerning a whole range of industry issues. Here, of course, we are circling back to one of our earlier topics. This was elegantly pointed out by an IR source in one of the top oilfield services companies:

“Everybody thinks ESG is important until the share price soars . . . then suddenly it’s just a nice-to-have.”

Skills to Perfectly Hone the Responsibility

When asked to list the qualities which define today’s successful Head of IR, our sources came up with an intriguing combination of hard and soft skills and Be an Agile Shape Shifter. This in itself makes the point that IR has become a highly nuanced role, requiring not just a set of qualifications but also a specific type of personality.

Top of the list is trustworthiness. One might point out that this is a desirable trait in any role, but sources were talking more about credibility in front of investors. This quality might also be sub-divided into professional and personal credibility. It goes without saying that your IR head needs to be across the numbers, but they should also resonate the virtues of plain-speaking and integrity. The need for trust, says one source, “is directly proportional to the volatility of your sector”. They expanded on the point thus:

“People need to believe you in the good times and the bad times. The first is easy, but the second is not. If there is any sense that you’re telling investors what they want to hear, that can be fatal. The market is always going to go up and down but your messaging has to be consistent and that’s an incredibly difficult trick to pull off if you haven’t got good faith with your audience.”

Given the importance of trust, it’s not surprising that “a good network” also features highly among our responses. It is for this reason that many of our sources were sceptical that their role could be performed effectively by someone without an energy background. Most IR heads are former analysts or bankers who spent many years broadening their network and garnering respect for their depth of sectoral knowledge. Once in IR, they were able to draw on their earlier career to establish credibility.

What are the most important skills required to do your job?
Fig. 2A: All mentions
Fig. 2B: First Mentions (%)

Several sources also stressed the importance of a background in finance. This is interesting because it touches upon the delicate matter of reporting lines. One occasionally hears suggestions that the Head of IR should report into the CEO. That might seem reasonable, given the enlarging of the role we have previously discussed. But sources were almost unanimous that this would be a strategic error. One quote serves as a useful summary of this majority opinion:

“Do I have a close relationship with the CEO? Absolutely, and that’s crucial, but my direct report is into the CFO and that’s as it should be. Otherwise, you just can’t get into the details.”

It’s interesting that this source, while strongly endorsing his upward reporting line, nevertheless stressed the importance of working closely with the top man. This hints at the last quality that sources mentioned in large numbers: strategy. Instead of characterising the Head of IR as someone who comes in after the event to shape messaging or undertake some sort of damage limitation exercise, sources were keen to emphasize the forward-looking aspect of their role. This is further evidence that today’s Head of IR is no longer a mere messenger or PR specialist. He or she is someone who can – indeed must – think and act like a senior executive.

This is consonant with most, if not all, of the qualities covered by the 18% of responses we have listed under “Other” in Figure 2b. Usually, these referenced some soft quality such as perseverance or commitment, although “excellent communicator” was another oft-mentioned term.

Before concluding this section, it is perhaps worth checking that our sources were not speaking about some mythical figure. In other words, how do the people we spoke to measure up against their own definition of the ideal Head of IR?

Actually, quite well. The adjective we would use to describe most of our sources is ‘impressive’. Yes, they came across as intelligent, technically expert professionals. But more striking was their charm, their thoughtfulness and their ability to communicate complex ideas in simple, but meaningful terms.

In a word, the modern Head of IR is a leader.


If we now know – in theory – what makes an effective Head of IR, the next obvious question is where an oil & gas or oilfield services company might find such a person. Clearly, the most likely hunting ground is represented by other direct competitors. Indeed, in-sector candidates are abundant because IR teams in the top oil & gas firms tend to be larger than those elsewhere. Our research shows that the average IR headcount at an oil major is 12, considerably higher than we see in most other industries. This means that even if the Head of IR is not open to a conversation, he or she is likely to have several direct reports, some of whom might conceivably be ready for a move into the top role.

There are also impressive IR individuals sitting in oilfield services firms. Admittedly, the teams here are smaller (often just one or two people) but the quality is by no means lacking. In most cases, the relevant IR head will have an earlier career in finance or M&A, excellent knowledge of the broader energy sector and a wide investor network.

If we wander out of the energy sector entirely, talent is somewhat thinner on the ground. However, metals & mining is certainly worth a look. Here again, there are some reasonably large IR teams (occasionally upwards of ten people) and incumbents are likely to be grappling with the same issues: ESG, volatility, regulation etc. For the same reasons, financial services might also offer some interesting talent.

We are well connected with all these talent pools, so if you are looking to develop your IR capability and/or appoint a senior IR leader, we’d be happy to share our insight and expertise.

To discuss any of the issues covered in this document, or to obtain additional information on Whitecrow Research’s Talent Intelligence capabilities, please contact:

Matthew Pitt
Global Head of Talent Intelligence


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