Investor relations (IR) is becoming one of the big business themes for the Gulf region as it emerges from the economic downturn.
At a conference last week in Beirut, Lebanon's buzzing capital, delegates from the Middle East Investor Relations Society discussed the issue at length in a two-day series of workshops, presentations and panel debates.
One fundamental concern that emerged among IR professionals was this: good communication with shareholders and investors was neglected, or ignored, in the days before the financial crisis of 2008, as the encouraging news at the time largely explained itself.
During the crisis and in its aftermath, especially in Dubai, corporates had to focus more closely on getting their messages across to investors, both regional and (a harder sell this) international.
By general consensus last week, Gulf business had made significant progress in improving the way it transmitted the essential messages to investors. But will it lapse back into the bad old ways now that recovery is taking root?
It would be a pity if that happened because the feeling among professionals is that within the region IR has made significant strides in the past two years. Dubai, often criticised for inadequate transparency and disclosure, was singled out for praise last week, with Dubai corporations such as Emirates NBD, DP World and du sweeping the board in the awards for best practice.
Other lessons have also been learnt. The financial crisis was sparked by issues in the credit and bond markets, rather than in equities (though the instant effects were seen in plunging share prices). So IR has been forced to broaden its target audience.
The focus now is as much on bank creditors, bond holders and ratings agencies as it is on ordinary shareholders. There, a lot of work is still to be done.
Oliver Schutzmann, a communications executive at Shuaa Capital in Dubai, showed exactly how much was yet to be accomplished in the field of direct communication with investors by asking for a show of hands among the conference participants: how many of the 60 or so people in the hall knew five or more regional investors?
Not a hand went up, though that response probably just as much reflects the absence of serious regional players in the asset management industry.
There also appears to be a gap to fill on the linguistics front. One Middle East bank representative told the audience IR had moved away from the increased flow of "insider information" in recent years.
He probably meant accurate, well-sourced information, rather than the illegal transmission of confidential corporate intelligence for the purposes of illicit share trading. Incidentally, it is also suggested that some parts of the Dubai business sector have taken to conducting board meetings entirely in Arabic.
That would be a retrograde step, given that a fair number of executives and most investors, bondholders and creditors, do not speak Arabic as a first language. If Arabic-only meetings became common practice, it would significantly set back the cause of good IR.
The same individual who surprised some delegates with the "insider" comment also broke the mould by declaring that bankers were not paid enough to take part in initial public offerings or provide mergers and acquisitions advice - surely the only man in the world to believe that bankers are underpaid.
The attendees kept coming back to one basic principle: transparency. The buzzword was used 15 times in the first hour of the conference and after that I stopped counting.
It was an "absolute pre-requisite" for good IR, according to Steve Kelly of Thomson Reuters Extel, the organisers of the conference.
Mr Schutzmann believes full transparency will only be attained when there is a trained and qualified cadre of IR professionals in charge of its transmission to the markets. To this end, he is organising a training programme for future IR executives and putting in place a certification process modelled on German IR standards, which are among the highest in the world.
He also believes the case of Dubai shows the benefits of getting IR right. Spreads on the emirate's credit default swaps (the cost of insuring against default on a company's liabilities) have fallen significantly since the height of the crisis, suggesting international markets are becoming interested in the Dubai story again.
But these spreads are still way ahead of other regional players such as Abu Dhabi and Saudi Arabia, where the crisis was less severely felt and where international investors were persuaded early on of the intrinsic strengths of those states' finances. More and better IR is still needed in Dubai, it seems.
Despite recent progress, there is still some way to go before the Gulf achieves international standards of IR practice.
"Is the region really prepared to take the issue as seriously as in the rest of the world?" asked another delegate, Kate Delahunty, the regional managing director of the communications group Capital MS&L.
"It requires a specific skill-set combining expertise in communications and finance, and people who have those are rare."
The ultimate long-term proof of the success of the IR campaign will be the sustained return of foreign capital to the region. Only time will tell.
fkane@thenational.ae
New schools in Dubai
Last-16
France 4
Griezmann (13' pen), Pavard (57'), Mbappe (64', 68')
Argentina 3
Di Maria (41'), Mercado (48'), Aguero (90 3')
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ACL Elite (West) - fixtures
Monday, Sept 30
Al Sadd v Esteghlal (8pm)
Persepolis v Pakhtakor (8pm)
Al Wasl v Al Ahli (8pm)
Al Nassr v Al Rayyan (10pm)
Tuesday, Oct 1
Al Hilal v Al Shorta (10pm)
Al Gharafa v Al Ain (10pm)
Name: Peter Dicce
Title: Assistant dean of students and director of athletics
Favourite sport: soccer
Favourite team: Bayern Munich
Favourite player: Franz Beckenbauer
Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates
ADCC AFC Women’s Champions League Group A fixtures
October 3: v Wuhan Jiangda Women’s FC
October 6: v Hyundai Steel Red Angels Women’s FC
October 9: v Sabah FA
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Alan%20Wake%20Remastered%20
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Results:
Men's 100m T34: 1. Walid Ktila (TUN) 15 sec; 2. Rheed McCracken (AUS) 15.40; 3. Mohammed Al Hammadi (UAE) 15.75. Men's 400m T34: 1. Walid Ktila (TUN) 50.56; 2. Mohammed Al Hammadi (UAE) 50.94; 3. Henry Manni (FIN) 52.24.
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Winners
Best Men's Player of the Year: Kylian Mbappe (PSG)
Maradona Award for Best Goal Scorer of the Year: Robert Lewandowski (Bayern Munich)
TikTok Fans’ Player of the Year: Robert Lewandowski
Top Goal Scorer of All Time: Cristiano Ronaldo (Manchester United)
Best Women's Player of the Year: Alexia Putellas (Barcelona)
Best Men's Club of the Year: Chelsea
Best Women's Club of the Year: Barcelona
Best Defender of the Year: Leonardo Bonucci (Juventus/Italy)
Best Goalkeeper of the Year: Gianluigi Donnarumma (PSG/Italy)
Best Coach of the Year: Roberto Mancini (Italy)
Best National Team of the Year: Italy
Best Agent of the Year: Federico Pastorello
Best Sporting Director of the Year: Txiki Begiristain (Manchester City)
Player Career Award: Ronaldinho
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Brief scores:
Manchester United 4
Young 13', Mata 28', Lukaku 42', Rashford 82'
Fulham 1
Kamara 67' (pen),
Red card: Anguissa (68')
Man of the match: Juan Mata (Man Utd)
The specs
Engine: 77.4kW all-wheel-drive dual motor
Power: 320bhp
Torque: 605Nm
Transmission: Single-speed automatic
Price: From Dh219,000
On sale: Now
About Seez
Company name/date started: Seez, set up in September 2015 and the app was released in August 2017
Founder/CEO name(s): Tarek Kabrit, co-founder and chief executive, and Andrew Kabrit, co-founder and chief operating officer
Based in: Dubai, with operations also in Kuwait, Saudi Arabia and Lebanon
Sector: Search engine for car buying, selling and leasing
Size: (employees/revenue): 11; undisclosed
Stage of funding: $1.8 million in seed funding; followed by another $1.5m bridge round - in the process of closing Series A
Investors: Wamda Capital, B&Y and Phoenician Funds