Technology: The New Industrial Revolution
IRC Domain 2: IR Planning, Implementation and Measurement, Domain 6: Business Insight and Domain 8: Capital Markets & Capital Structure
Summary by Michael Ferreter
Panelists:
Adam Frederick, SVP of Intelligence, Q4 Inc.
Aaron Hoffman, Vice President, Investor Relations, TransUnion
Andrew Liuzzi, Executive Vice President, Crisis and Risk Management, Edelman
Moderator: Darrell Heaps, CEO & Founder, Q4 Inc.
KEY TAKEAWAYS:
- Artificial intelligence is a common way technology is changing the investor relations role, with “big data” analytics processing huge amounts of information.
- IR can be slow to adapt, and is not historically a heavy user of technology, but today’s computing power creates lots of options.
- The Equifax data breach was used as a case study of how a competitor’s problem can still be an issue for your firm: even if it wasn’t your data breach, you carry the reputational burden.
SUMMARY:
Darrell Heaps introduced the panel by commenting that technology is transforming everything, from our personal lives to work. (Quoting a Davos speaker: “Technology is the fourth Industrial Revolution.”) Given the breadth of the topic, the panel focused on artificial intelligence (AI) and cybersecurity. Adam Frederick defined AI as machine-generated intelligence, which includes Apple’s Siri, smart thermostats and autonomous cars.
For capital markets, the main usage is big data analytics that can absorb and process huge amounts of information to make investment decisions. Predictive analytics is another common use case. This can take the form of IROs using AI to target key investors or to predict which firms will buy the company’s stock in the next 90 days. AI can help identify shareholder activists by seeing patterns in data that can predict future actions. But even with the growth in computing power, the human element is still needed to oversee the machines.
Cybersecurity is the other key technology aspect the panel considered. As a crisis manager, Liuzzi described himself as “the guy you don’t want to talk to.” As a data security and privacy expert, he counsels companies when they’ve had a cybersecurity incident or data breach. He emphasized that boards need to get comfortable with being cyber experts. If that talent doesn’t exist at companies, boards should recruit it.