“We are pushovers
The global healthcare company Novo Nordisk (DK) has been recognized multiple times for its outstanding investor relations – “outstanding” in the way that it meets the requirements and needs of shareholders, potential investors and other capital market participants. Peter Hugreffe Ankersen, CVP & Head of Investor Relations, Novo Nordisk, provides insights into his approach.
Can you please briefly describe your IR approach?
We want to communicate openly and honestly to our key stakeholders – investors and analysts – about Novo Nordisk’s short- and long-term objectives. We aim to be as transparent and consistent in our communication as possible, and our ambition is to continuously ensure a fair pricing of the Novo Nordisk share.
You and your team are models of best practice – from your perspective what is the reason for your success?
We are a small but dedicated team comprising five investor relations officers striving to be responsive and continually deliver consistent communication. Novo Nordisk’s executive management team pays the utmost attention to institutional investors and sell-side analysts, and participates in very intense roadshow activity around our quarterly reporting. The investor relations team is relentlessly interacting with key stakeholders and has more than 200 days on the road visiting investors. In addition, we put a lot of effort into our presentation material, which is updated on a regular basis keeping investors abreast of our key markets and disease areas.
What are your main tasks, responsibilities and stakeholders – external and internal?
Our key external stakeholders are institutional investors and sell-side analysts. We interact with our external stakeholders on a regular basis: with specific sell-side analysts virtually on a daily basis, and with institutional investors frequently via conference calls and meetings. Our major task is to update stakeholders on company-specific matters and provide competitive and industry perspectives. Internally, we have a wide range of stakeholders from all parts of the organization, and Investor Relations’ greatest task is to coordinate all activities with those internal stakeholders.
Who do you report to?
Novo Nordisk Investor Relations reports directly to the CFO.
How many people are working within your department?
Investor Relations comprises five Investor Relations officers, including one head of IR, and three support staff.
What are the roles of your team members?
A key aspect of our Investor Relations is that all officers have the same responsibility when it comes to communication with investors and sell-side analysts, an indication that all Investor Relations officers can speak about all facets of Novo Nordisk. The tenure in Novo Nordisk Investor Relations is typically 2–3 years and the majority of staff have a background within Novo Nordisk.
Where is your team located?
The majority of the team is located at our headquarters in Bagsvaerd, Denmark, but we have Investor Relations officers located at our US headquarters in Princeton, New Jersey, servicing the US institutional investors and sell-side analysts.
How do you measure the success of your work?
Our overall vision is to be the best Investor Relations organization in the global pharma industry. We measure our performance against annual perception studies conducted by the institutional investor, Extel, and IR Magazine, and we have set targets for both local and European performance.
Novo Nordisk is known for its integrated reporting (and thinking) approach. What role does this play within Investor Relations?
Our integrated reporting is an integral part of our annual report and multiple stakeholders are involved in the reporting process. Investor Relations contributes, but the overall process is run by our corporate communication department.
How have the requirements from capital market participants changed within the last few years? How do you address these changes?
We have always set a very high standard for enabling investors and sell-side analysts’ to access to executive management, but the requirements have intensified in recent years and we have tried to be as accommodating as possible. In recent years we have hosted bi-annual capital markets days; meet-the-management Q&A sessions at every half year; scientific presentations at the two annual diabetes conferences in the US and Europe, and have held several topical calls. All of this on top of our quarterly reporting activities and frequent investor conference participation. There is a delicate balance between providing relevant information and delivering information overload, we try to successfully walk this fine line on a continued basis.
How do you stay ahead of the game and to meet investors’/analysts’ (changing) requirements?
We are pushovers for feedback and consistently request comments and advice in the activities we host ourselves, in those activities related to perception studies, and in our frequent interaction with key stakeholders. Based on this feedback, we are able to gauge whether we are on the right track.
What are the current challenges for Novo Nordisk Investor Relations?
For a very long time, Novo Nordisk has delivered strong doubledigit earnings growth. However, as a result of intense competition and pricing pressure in the US, we will likely not deliver as we have previously in 2016 and 2017. Communicating this to the investor community has been and will remain a major task.