Here are my top ten tips for keeping shareholders happy:
1. Under-promise and over-deliver. Shareholders are slow to forgive when disappointed. Pitch forecasts at levels that can be comfortably achieved.
2. Give maximum detail in annual and interim reports. This offers the best chance of communicating your story to the investing community.
3. Don’t be afraid to give an honest appraisal of the business outlook. Bad news is bound to leak out eventually.
4. Don’t overpay yourselves. Shareholders want to know that their own interests are aligned to those of the directors.
5. Keep your broker and PR adviser up to the mark. Be demanding with advisers and don’t hesitate to switch to new ones if you’re unhappy.
6. Use your website. Companies have a great opportunity to communicate to shareholders via websites. Webcasts are now common.
7. Court private investors. You can build up a private-investor following by using the right brokers and the media.
8. Keep it simple. Companies in intellectually challenging industries must explain their business in simple terms.
9. Pay a dividend. This is a good discipline and reassures investors.
10. Allow the numbers to speak for themselves. A company’s financial performance will always find eventual reflection in the share price.