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Symmetrical versus asymmetrical company‐investor communications via the internet

Harold Hassink (Department of Accounting and Information Management, Faculty of Economics and Business Administration, Maastricht University, Maastricht, The Netherlands)
Laury Bollen (Maastricht University, Maastricht, The Netherlands)
Michiel Steggink (Ernst & Young, Eindhoven, The Netherlands)

Corporate Communications: An International Journal

ISSN: 1356-3289

Article publication date: 15 May 2007

1381

Abstract

Purpose

In previous studies it remains unclear whether the internet is an effective mechanism for developing a symmetrical and interactive communications process that is initiated by the investor rather than the company. The purpose of this paper is to study the effectiveness of the internet to act as a mechanism to achieve a more interactive communication between companies and investors.

Design/methodology/approach

A “mystery investor” approach is used to test whether companies reply to e‐mails from investors. Content analysis was used to study the responsiveness, timeliness and relevance of the answers.

Findings

The quality of symmetrical communication (in terms of responsiveness and relevance) appears relatively low. Companies with high‐quality investor relations (IR) web sites do not handle e‐mails more effectively. Therefore, high‐quality asymmetrical communication between company and their investors not automatically associated with a high‐quality symmetrical type of communication.

Practical implications

Companies that provide e‐mail facilities for investors create the impression that they welcome communications with investors. However, if companies fail to handle incoming e‐mails from investors quickly and correctly, they create feelings of dissatisfaction. As a result e‐mail facilities on web sites are counter‐productive and hamper the creation of good relationships with investors. These results emphasize the need for better internal routing, better instructions and specific training programmes for IR staff.

Originality/value

The paper provides original evidence on the potential of the internet to enhance symmetrical communication between companies and their investors. This paper contributes to a better understanding of the way the internet can be used by IR departments to enhance the communications with investors.

Keywords

Citation

Hassink, H., Bollen, L. and Steggink, M. (2007), "Symmetrical versus asymmetrical company‐investor communications via the internet", Corporate Communications: An International Journal, Vol. 12 No. 2, pp. 145-160. https://doi.org/10.1108/13563280710744829

Publisher

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Emerald Group Publishing Limited

Copyright © 2007, Emerald Group Publishing Limited

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