The objective of the IR department within a company is to help investors make informed decisions in their actions regarding the company’s equity. The IR department does this by providing up-to-date information about the company’s operations, financial statements to current and potential shareholders, as well as third-party equity research analysts.

The material given may include quantitative financial documents such as annual/quarterly reports, but also qualitative information such as the company’s business model and strategic direction. Information is regularly disseminated through sections of the company’s website dedicated to IR, but also through events such as press releases and shareholder meetings. When done correctly, this leads to stability in the company’s stock prices, as shareholder expectancies about the company’s performance are correctly formulated around the actual decisions made by management. A positive secondary effect is that the company is painted in a positive (albeit correct) light that is attractive to potential investors.

Communication is also a two-way street; the IR department is also responsible for forwarding input from significant stakeholders of the company to management. During times of crisis (financial or otherwise), the IR department will advise management with a goal to preserve the company’s relationship with its investors, as well as to mitigate any damage to share prices.

Where the IR department falls within a company’s corporate structure can oftentimes reflect the roles/objectives the management team desires the IR team to prioritize. The IR department will usually be found as a subset of some company’s Public Relations department, but can instead also report directly to the Chief Financial Officer (CFO) or Finance departments. Other company structures might place it under the Legal or Accounting departments, while a few have it as a standalone department.