| Investor relations is one of the most important corporate communication functions---survival of an organization depends on how well current and potential investors as well as everybody else in the investment community understand the value of the company and its business model. As a result, investor relations occupies a respectable place at the top of the corporate agenda. At the same time, it also becomes important to develop academic theory-based research in investor relations. This dissertation proposes one possible approach to theory-building in investor relations.;This study assumes investor relations to be a specialization, or sub-function, of public relations. To support this assumption, practical and historical similarities of these two functions are analyzed. Then, a methodological approach to analyzing investor relations practice, Continua of Investor Relations, is proposed. The continua are based primarily on one of the dominant theoretical perspectives in public relations, Excellence theory. The Continua of Investor Relations model analyzes the practice of investor relations in five key areas: direction of communication, intended beneficiary, enacted role, nature of investor relations, and focus of investor relations.;The study also suggests, based on review of public relations and investor relations literature, that the practice of investor relations today is characterized by a shifting focus from mere disclosure of financial information to extensive two-way communication of both financial and non-financial information. As a result, the study analyzes the information communicated by corporations to the investment community.;The study conducts a primary data collection. A random sample of members of the National Investor Relations Institute was invited to participate in the Web-based survey. The study achieved a response rate of 33%. The study's findings indicate that investor relations practice can be best described as utilizing two-way communications, having both interests of management and shareholders in mind, focusing simultaneously on short-term and long-term objectives, and performing both managerial and technical tasks. However, according to the results of this study, the practice of investor relations is predominantly reactive rather than proactive. Investor relations practitioners are often trained in finance and lack strategic communication expertise. The function is often organized in a stand-alone department, but, nevertheless, most often reports to the CFO. As a result, the focus is still mainly on financial information, with non-financial information taking second place. Among various kinds of non-financial information, corporate strategy is the most important and most often communicated. However, there is not enough communication about the quality of corporate management.;Based on these findings, the study concludes by providing several recommendations for investor relations practice, research, and education. Among recommendations are the following: developing more communication expertise in investor relations, transitioning oversight of the function from the CFO to the CEO, improving quantity and quality of non-financial information, and relying on strategic planning in carrying out investor relations activities. |
