Global IR Insights – 22nd March 2022
Welcome to the March edition of Global IR Insights where our Australian team shares intel from our global network in the world of capital markets communication and what it might mean for Australia.
Short sellers in the spotlight for ‘spoofing’ and ‘scalping’
US prosecutors are investigating whether short sellers have conspired to drive down stock prices illegally, as reported in The Wall Street Journal. Tactics under investigation include “spoofing,” an illegal ploy that involves flooding the market with fake orders, and “scalping”, where activist short sellers cash out their positions without disclosing it. We expect Australian regulators will be keeping a close eye on these issues.
Delivery Hero’s unorthodox approach to IR
Niklas Oestenberg, the CEO of German multinational Delivery Hero, proudly tweeted the Company’s Q4 achievements this month, only to watch the share price drop 30% in four hours. Oestenberg then apologised, tweeting “I’m truly sorry for all shareholders”, and even included a sad-faced emoji. It is safe to say, that the replies to the tweet were less than positive – with one tweeter claiming the cause of the share price drop was as a result of “arrogance and a complete lack of understanding capital markets”. Ouch.
Shareholders reign supreme despite CEO promises to society
Despite big words about employees in M&A, most executives are still firmly engaged in shareholder capitalism when it comes to dealmaking, says the Wall Street Journal. Academics at Harvard Law School analysed 116 takeovers worth more than $1 billion since April 2020 and found that none of them included any legally binding protection of jobs or compensation for those laid off. Perhaps more attention needs to be paid to staff and employee engagement in global M&A.
Are PR & IR working closely enough?
British-multinational Unilever has faced multiple reputational crises over the past few weeks, leading PR Week to question whether Public and Investor Relations professionals are working together closely enough to manage corporate reputations. It is suggested that the PR and IR functions should be seen as two sides of the same coin as both functions are outwards facing and both serve the same purpose – to communicate effectively with the outside world. Understood this way, organisations need professionals who understand both disciplines and who can balance the interests of a range of external audiences.
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