What's So Good About Investor Surveys?

Can you imagine seeing a medical doctor who prescribes treatments without ever asking you 'what seems to be the problem? Or taking your car to a mechanic who decides to rebuild your engine without running a single diagnostic test or even opening the hood. The mere thought is preposterous.

Yet the same 'prescribe and implement without researching' approach is used time and again by hundreds of public companies who routinely fail to test investor sentiment toward corporate strategy, management capabilities or disclosure policies.

It's little wonder that many CEOs believe their companies are misunderstood and under-appreciated by investors, yet have no idea why.

Investor surveys are meant to close the gap between what the company believes investors think and what they actually think.

Qualitative in nature and conducted by a third party who guarantees anonymity, these surveys include open-ended questions such as:

• What do you think of the company's value creation strategies?
• What do you think of management's ability to generate growth?
• How could the company improve disclosure?

Hypothetical questions can also be inserted to help your company judge investor reaction to different corporate policies - before they are implemented.

Based on an interpretation of survey findings, your company will have a better understanding of investor sentiment and a clear picture of how to improve financial communications. That's what's so good about investor surveys.