The Use Of Public Relations To Promote Government-Investor Relations

Introduction

Public relations play a paramount role in an organisation be it private or public. It promotes and aids the realisation of goals set by an organization goals and productivity, PR builds and maintains reputation of any institution that uses it effectively. As the world is becoming complicated and diversified, it becomes increasingly important for an organisation to effectively communicate with its publics in marketing products and services peculiar to such entity, in turn increasing the importance of effective PR and reputation management. PR is a distinctive management function which helps establish and maintain mutual lines of information flow, understanding, acceptance and cooperation between an organisation and its publics; involves the management of problems or issues; helps management to keep informed on and responsive to public opinion; defines and emphasizes the responsibility of management to serve the public interest; helps management keep abreast of and effectively utilize change, serving as an early warning system to help anticipate trends; and uses research and sound and ethical communication as its principal tools. PR activity is the management of communication between an organisation and its publics. PR can also be described as a planned effort to influence opinion through good character and responsible performance, based upon mutually satisfactory two-way communications. PR practitioners’ roles also contribute to identifying, establishing and extending the organisation’s sphere of influence.

PR is the deliberate, planned and sustained effort to establish and maintain mutual understanding between on organisation and its publics, it is the attempt by information persuasion and adjustment to engineer public support for an activity, cause, movement or institution. Bernays (2015) sees PR as a combination of philosophy, sociology, economics, language, psychology, journalism, communication and other knowledges into a framework encouraging human understanding. It is merely human decency which flows from a good heart, a good performance, publicity appreciated because adequately communicated (Bernays, 2015). PR is winning friends and influencing people. However, it is everything involved in achieving a favourable opinion. Also, Pubic Relation Association sees the public relation as the management function which gives the same organized and careful attention to the asset of goodwill as is given to any other major asset of business. In a broad way, PR is a distinctive management and organizational function which helps establish and maintain mutual lines of communication, understanding, acceptance and cooperation between an organisation and its publics; involves the management of problems or issues; helps management to keep informed on and responsive to public opinion; defines and emphasizes the responsibility of management to serve the public interest; helps management keep abreast of and effectively utilize change, serving as an early warning system to help anticipate trends; and uses research and sound and ethical communication as its principal tools. On the other hand, the National Investor Relations Institute in 2003 sees investor relations (IR) as a strategic management responsibility that integrates finance, communication, marketing and securities law compliance to enable the most effective two-way communication in a company, the financial community, and other constituencies, which ultimately contributes to a company’s securities achieving fair valuation. As this definition illustrates, investor relations is both a financial discipline and a communication or management function (Inoue, 2009). It clearly emphasizes not just communication but “two-way communication,” this is a concept infused with PR. However, government is a complex arrangement or mechanism through which the will of the state is achieved, this in turn has afford intellectuals to direct the affairs of the state to contribute immensely to the progress of the society. Presently, most countries of the world are in the era of vast communication. Although, various government around the countries of the world had realized the importance of PR as a factor of communication, yet little is known about the role PR play in government-investor relations (GIR). Hence, this piece aims to assess the role PR on GIR.

Ways by which PR has promoted GIR

PR involves two-way communication to foster relations with its multiple stakeholder publics, such as employees, customers, investors, governmental agencies, the community, and the media (Inoue, 2009). The concept of modern-day PR is said to have originated in the United States, and its rise as a profession correlated with the rise of mass circulation newspapers and magazines from 1900 through 1917. Powerful business interests in the early 1900s employed PR to defend themselves and their monopolies against muckraking journalists and increasing interest in government regulation. The emphasis was on telling their side of the story and on counterattacks designed to influence public opinion and to prevent increased governmental regulation of business. In this environment, one-way persuasive communication dominated, and mutually beneficial two-way communication was virtually nonexistent. But as governments came to realize they could not survive unless they take public interests into account, they began to adopt PR to reinforce relationships with their stakeholder (publics) in the context of IR under “two-way communication, which is a standard communication model for today’s PR (Inoue, 2009), an organization uses research and dialogue to manage conflict, improve understanding to build their behavior. When it comes to the traditional role of PR on IR, it is important to remember that PR practitioners in those days operated in an era before the huge upsurge of the electronic financial media and the Internet.

Communication in the world is generally dominated by widely circulated news and magazines, many of which were susceptible to skilled of PR campaigns. Because of this, corporate PR came first, and distinguished from IR, and was thought of in connection with marketing, government relations, and general corporate image campaigns. Not until recently, PR practitioners were largely regarded as news release writers, more tactical than strategic. The modern-day IR and PR officers must clearly understand the regulatory activities and obligations of their jobs, at the same time must be conscious of fielding back questions from institutional investors, media and analysts. One may ask that what exact strategy or mechanism is in operation in IR, what working relationships do they have with PR practitioners, and what overall operating conditions they are placed in. For instance, in the United States 93% IR officers engaged with two activities; one reacting to demands from shareholders, analysts or stockbrokers, presentations and conferences. And they also use mass media communications which is a potential part of PR. As far as the apparent importance of various publics for IR officers is concern, institutional investors took an edge, trailed by stock analysts and brokers, internal publics consisting of employees and management, stock exchanges, government, private investors, and mass media. Here again, PR has shaped the educational background of IR officers. While, in Japan the IR work in Japan used to be handled almost only by the finance/treasury department, yet it has increasingly been managed by the corporate/management planning department as of late engaging basic idea of PR. In this regard, PR has guaranteed GIR's share cost is fairly valued, trailed by tasks to advance understanding of government business and to facilitate a relationship of trust with shareholders and investors (W. Ragas et al. , 2014). PR engaging mass media communication became part of the major activity of IR officers in Japan as is in USA. Investing on PR has helped government to achieve its objective viably and easily in the area of classical IR. PR is not creating great image for a bad team since false image cannot be sustained for quite a while. In spite of the fact that the government administrations are great in its needs for a viable PR campaign for attracting, motivating the society to the administration or towards the reason for the program. It is not just encouraging the inclusion from people in general and also bringing about better image. PR is capable of determining the image of government or a nation. When a country is under financial crisis a successful PR can expel the 'misunderstanding' and can create mutual understanding between the government and general society (W. Ragas et al. , 2014). PR analyses general society recognition and attitude, distinguishes the government financial strategy with open intrigue and then executes the programmess for communication with people in general. PR has utilized planned exertion or management work; evaluation of open attitudes and suppositions; execution of an action and or communication programme; and improvement of rapport, goodwill, understanding and acceptance to integrated finance, communication, marketing and securities law compliance to enable the best two-way communication in a company, the financial network, and different bodies electorate, which ultimately adds to a company's securities achieving fair valuation. Also, it is important to realize that Grunig, Grunig and Dozier (2006) worked broadly in the field of PR and came out with the Excellence theory.

This theory shows PR could make an institution to grow, it has also paved way for management and organization of an institution in a context of adequacy. It is important to know that series of investigation in the field of PR led to the formulation of excellent theory (Grunig et al. , 2006) Also, PR engages propaganda in the manipulation of symbols to transmit accepted attitudes and abilities which depicts political application of publicity and advertising, also on a large scale, as far as possible of moving a financial idea (Smith and Lasswell, 2015), this comprises of deliberate, single-reason publicity program, usually on a pretty much elaborate scale, utilizing coordinated publicity through a variety of media, aimed, at various targets, yet focused on explicit objectives. However, lobbying is also a strategic communication in PR, it entails the effort of impact, smooth and measured weight on other, exercise of persuasion. Generally, it means an IR who uses PR is putting his perspectives forward trying to win alternate investors to help educate the new administration/strategy which call for PR to make more extensive publicity so as to defeat any resistance in GIR process. PR is important as it is engaged in the implementation of open approach, assisting the news media in coverage of government financial activities, detailing the citizenry on agency activities, increasing the internal union of the agency, increasing the agency's touchy to its open's financial mobilization of help for the agency itself. Smith and Lasswell (2015) sets that the basic capacity of the government PR-IR department/financial agencies is to give information, education/instruction to the citizens. The exertion PR ought to also motivate the general population straightforwardly or by implication, to discharge these capacities in a meaningful and intentional manner, it is necessary that the PR Department/wing ought to be clear about the broad objectives which manage their work. The national objective ought to be non-political, non-controversial, and on which there ought to be a national agreement. The goals of IR should encourage the interests and the prosperity of the general population and advance the improvement of the nation. In this regard, PR fortify the IR as it gives a structure around existing promotional financial activities, guarantees reliable messaging, allows rapid reaction to explicit issues as for target audience, accommodates cheaper actions than advertising and marketing and higher rate of return.

PR-IR Convergence

Penning (2011) posited that PR utilizes communication with stockholders, known as investor relations, has been increasing in popularity as a specialty in the PR profession (Penning, 2011). At present, the National Investor Relations Institute (NIRI) has 4,400 individuals in thirty-three chapters in USA 46% of them have a background in communications/PR, while 49% have a background in finance J accounting. This blending of PR and finance profession in investor relations has had several outcomes. One is that PR professionals have had to work to gain acknowledgment in the investor relations arena. People do not see IR as a PR work, and when they do, they see it more as a technical activity than a managerial capacity. Besides, and perhaps because of this discernment, investor relations have gotten scanty scholarly attention. Laskin found that investor relations as an idea has been generally neglected by communication journals. Existing investigations of investor relations center generally around financial and accounting ideas. The primary experts in investor relations are analysts, business journalists who cover investing, and investors. Nevertheless, individual investors, also called retail investors, remain important, although they also have gotten little research center to date. The American Association of Individual Investors (AAII) has 150,000 individuals, and many more probable have just not affiliated formally with this organization. Taking into account how to gain understanding of how individual investors use and value information from PR professionals as for news media and different sources, one should realize that PR content is aiding financial decision making.

Conclusion

PR play a paramount role in an organisation be it private or open. It facilitates the achievement of an Organization. (PR) assist in increasing an organization's productivity. It also aids in building and maintaining its reputation. As the world is getting to be complicated and broadened, it turns out to be increasingly important for an organization to adequately communicate with its publics in marketing its products and administrations, thus increasing the importance of successful PR and reputation management. PR is a particular management work which establishes and maintain mutual lines of communication, understanding, acceptance and cooperation between an organisation and its publics; this entails the management of issues or issues; causes management to keep educated on and receptive; characterizes and emphasizes the duty of management to serve the general population intrigue; enables management to stay informed concerning and adequately use change, filling in as an early warning framework to help anticipate patterns; and uses research and strong communication skill as its principal instruments. Then again investor relations (IR) is a strategic management obligation that integrates finance with communication, marketing and securities law compliance to enable the best two-way communication in a company, the financial network, which ultimately adds to a company's securities achieving fair valuation. As this definition illustrates, investor relations is both a financial control and a communication work. This piece inferred that investors used a variety of information to make decisions, one of which is PR yet recommended that this is specifically the case when investors value information with a far-reaching quality. It has been recognized that the conditions associated with investors choosing information would be viewed as PR content. Looking for far reaching information is all the more unequivocally associated with the PR apparatuses of annual reports and news releases than different wellsprings of information. This validates PR communication as having value to an explicit arrangement of individual investors and proposes that PR communications content has to such an extent or more value than information from the news media or different sources in an investor relations setting.

The most practical lesson is that investors select explicit sources especially when they have explicit sorts of investing information needs to gratify: it has been recommended that PR is a factor investor relation, explaining that it is essentially a PR communications work that requires a specialized learning base. The ranges of abilities required for IR are the solid communications aptitudes acquired through PR training, together with the financial learning acquired through a business deal. Finally, it is concluded that everything that happens in GIR affects view of investors and other stakeholder and publics. Against this backdrop, not just the financial news, for example, earnings announcements and analyst reports, yet in addition non-financial metrics, for example, quality of management, relationships with clients, new item launches, innovation and all the more all have a magnified impact on stock developments. IR professionals must endeavor to communicate a variety of corporate news viably and correctly. Also, there is a flattening of stakeholder publics, and the line among IR and PR has obscured. IR professionals are starting to concentrate on business fundamentals as well as industry patterns. PR professionals are aware of new item specifications and their financial implications. This convergence along these lines progressively is obvious for PR to have taken strategic role in GIR.

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