Investor Relations: Two-Way Symmetrical Practice

Journal of Public Relations Research, 22(2):182–208, 2010
Copyright # Taylor & Francis Group, LLC

ISSN: 1062-726X print=1532-754X online
DOI: 10.1080/10627261003601630
Investor Relations: Two-Way

Symmetrical Practice
Kathleen S. Kelly
Department of Public Relations, University of Florida
Alexander V. Laskin
Department of Public Relations, Quinnipiac University
Gregory A. Rosenstein
Superior Energy Services Inc., Louisiana, USA
Although public relations claims investor relations as one of its specializations,

scholars have paid little attention to it and practitioners historically have been
divided between finance and public relations. A national survey of 145 members
of the National Investor Relations Institute and the Public Relations Society of
America’s Financial Communications Section tested models and dimensions of
practice to build theory. Results show that such investor relations officers pre-
dominantly practice the two-way symmetrical model and their work is character-
ized by the dimensions of symmetrical effects and—to some degree—two-way
communication. Practitioners do not differ by their orientation to either finance
or corporate communication=public relations. This study is the first to find the
predominant practice of the normative model across its sample, thereby refut-
ing long-standing criticism that the symmetrical model is a utopian ideal. The
two-way symmetrical model does exist in the real world, and it can be found
in the bastion of capitalism—publicly owned corporations in the United States.
Investor relations represents one of public relations’ most unfortunate

paradoxes. Investor relations practice has grown in importance and received
increased attention in corporate America. Yet it commands little attention
Correspondence should be sent to Kathleen S. Kelly, Professor, Department of Public

Relations, University of Florida, Gainesville, FL 32611-8400. E-mail: kskelly@jou.ufl.edu
182
INVESTOR RELATIONS: TWO-WAY SYMMETRICAL PRACTICE 183
in public relations scholarship, even though the discipline claims investor

relations as one of its specializations, or subfunctions.
Furthermore, since its earliest days, investor relations practice has been
divided into two seemingly opposing camps: those who believe the function
is best practiced from a finance orientation versus those who believe the
function is best practiced from a corporate communication=public relations
orientation. Issues of orientation include the function’s structural location
and practitioners’ expertise and training. Recent financial crises, corporate
scandals, and market developments, as well as maturation of both investor
relations and public relations, have created a new environment in which
common ground between the two camps must and can be found. Studies
that advance theory on investor relations are needed.
Although a relatively new field of scholarship, public relations offers a
robust theory to apply to the investor relations specialization: models of
practice, which form the basis for Symmetry=Excellence theory. The
theory prescribes that investor relations officers should practice the
two-way symmetrical model to effectively manage relationships between
their publicly owned corporation and its stockholders and other financial
publics. Unfortunately, until now, tests of the theory—spanning more
than 20 years—have failed to document widespread practice of the
normative model, leading critics to charge that the model is impractical
and idealistic due to the imbalance of power between organizations
and their publics.
BACKGROUND AND LITERATURE
Stephen Schultz (cited in McCartney, 2003), then director of corporate

governance programs at Shareholder.com, noted the growing importance
of investor relations: ‘‘IR as a discipline is beginning to escalate within
public companies.’’ Laskin (2006) found that 65% of the Fortune 500
companies represented in his exploratory study have a dedicated investor
relations department. Investor relations deals with a powerful enabling
public, owners of a company’s stock (J. E. Grunig & Hunt, 1984)—as well
as such influential mediating publics as stock analysts and the financial
media. The function is unique to a small portion of US businesses—about
8,000 companies that are publicly owned. Publicly owned corporations
are registered with the Securities and Exchange Commission (SEC), and
they and their investor relations function are regulated by that federal
agency and other watchdog groups. Although small in number, publicly
owned corporations are the core of capitalistic economies in the United
States and elsewhere. The importance of investor relations is tied to the
184 KELLY, LASKIN, AND ROSENSTEIN
principle that the relationship between investor publics and corporate

management affects a company’s bottom line (Gelb, 2000).
Recent scandals concerning financial practices at such public companies
as Tyco, WorldCom, and Global Crossings resulted in greater scrutiny of
compliance with disclosure standards and more attention to investor
relations. The most well-known scandal was at Enron. According to Allen
(2002), ‘‘The collapse of energy giant Enron is the largest bankruptcy and
one of the most shocking failures in US corporate history’’ (p. 206). The
scandals led to stiffer regulations from the SEC and Congress, with passage
of the Sarbanes-Oxley Act in 2002 aimed at improving corporate govern-
ance and making managers and boards of directors more accountable. Allen
(2002) stated, ‘‘In the post-Enron era, investor relations vaults to the top of
the corporate agenda, as companies must begin to rebuild investor confi-
dence’’ (p. 206). He added, ‘‘The communication skills of IR specialists will
be more important than ever’’ (p. 211).
Current economic conditions resulting from widespread market failures
and the recession that began in 2008 have intensified attention to investor
relations. The ramifications of what is commonly believed to be the greatest
financial crisis since the Great Depression will be many. Regulatory reform
of the US financial system is inevitable, according to the president and chief
executive officer (CEO) of the National Investor Relations Institute (NIRI),
Jeffrey Morgan (2008). New regulations could include ‘‘improved insti-
tutional ownership transparency, increased corporate disclosure . . . and
International Financial Reporting Standards’’ (p. 2).
The value corporate America places on investor relations is reflected in
findings of salary surveys, which regularly document that investor relations
is the highest paid specialization of public relations. For example, the 2006
salary survey sponsored by PRWeek and Korn Ferry identified investor
relations as the highest paid of the eight specializations, or disciplines,
measured (Iacono, 2006). The median salary for practitioners specializing
in ‘‘financial=IR’’ was $165,620, followed by ‘‘crisis management’’
($150,000) and ‘‘reputation management’’ ($143,000; p. 19). Salaries for
the remaining specializations ranged from $98,500 for ‘‘public affairs’’ to
$59,910 for ‘‘community relations’’ (p. 19). Similarly, investor relations
was the highest paid specialization among members of the Public Relations
Society of America (PRSA) in the society’s 1993 salary survey (Tortorello &
Wilhelm, 1993).
In contrast to its importance, studies of investor relations from a public
relations perspective are rare. Sallot, Lyon, Acosta-Alzuru, and Jones (2003)
conducted a content analysis of all articles published in Public Relations
Review, Journal of Public Relations Research, and its predecessor, Public
Relations Research Annual, since their inceptions through 2000. The purpose
of their study was to investigate the status of theory building in public

relations. The article reporting results of the study included an appendix
listing the titles of the 748 articles analyzed, organized by categories.
Searches of an online version of the appendix, using various terms, revealed
that only one of the 748 articles published by the leading public relations
journals focused on investor relations: Petersen and Martin’s (1996)
‘‘CEO Perceptions of Investor Relations as a Public Relations Function:
An Exploratory Study,’’ which is discussed shortly. Four other articles dealt
with annual reports (e.g., Hutchins, 1994), and one article featured a study
that used investor relations messages to test the situational theory of publics
(Cameron, 1992).
Sallot et al. (2003) found that 148 of the articles analyzed (19.8%) had
contributed to theory development in 19 subcategories. Fundraising, which
also is defined as a public relations specialization, was one of the 19 subcate-
gories and had commanded four theory-building articles (e.g., Kelly, 1995a).
Investor relations, on the other hand, was absent from the discussion of
theory development in public relations.
Finance Versus Public Relations

Public relations associations, educators, and textbook authors have long
held that investor relations is a specialization, or subfunction, of public
relations. For example, the Body of Knowledge Task Force of PRSA
(1988) included investor relations as one of the seven subfunctions of public
relations, along with media, internal=employee, consumer, community,
government, and fundraising=donor relations. Kelly (1992) found that
88% of educators representing accredited journalism and mass communi-
cation units that offer public relations programs agreed that investor rela-
tions is a specialization of public relations. Authors of public relations
textbooks traditionally have included investor relations under the umbrella
function of public relations. Seitel (1992), for example, incorporated investor
relations but pointed out that its practitioners differ from others in public
relations because of the ‘‘specialized financial skills and experience required
to communicate effectively with numbers-oriented audiences’’ (p. 484).
Research findings of Petersen and Martin (1996) refute public rela-
tions’ claim on investor relations. Their survey of CEOs of nonbanking
public companies in Florida showed that investor relations is ‘‘most
frequently treated as a financial function, both in terms of who is in
charge, and what are qualifications for the job’’ (p. 204). The researchers
concluded that investor relations seldom is managed by public relations
practitioners, not because activities essentially differ but because CEOs
of the companies ‘‘do not perceive investor relations to be part of the
public relations function’’ (p. 173). Petersen and Martin summarized the
situation:
Conventional wisdom among public relations scholars and practitioners consid-

ers the two functions bound together under the organizational umbrella of com-
munication management. However, corporate reality is that the investor relations
function only infrequently reports to public relations executives. (p. 173)
Statistics from the leading professional association of US investor rela-

tions practitioners, NIRI, support the research findings just given. NIRI’s
most recent membership survey, conducted in 2005, showed that 69% of
the corporate participants (investor relations officers, as opposed to consul-
tants) report to the chief financial officer (CFO), with an additional 17%
reporting to other members of the C-Suite, such as the CEO or chairman
of the board (Thompson, 2005). Of the corporate participants, 49% have
a finance=accounting background, whereas only 23% have a commu-
nication=public relations background. An additional 19% came to investor
relations from marketing and sales. Similar background proportions have
been reported for more than a decade (e.g., NIRI, 1992).
Founded in 1969, NIRI currently has more than 4,400 members repre-
senting the majority of the largest publicly held US corporations, as well
as many small and mid-size companies (NIRI, n.d.-c). Congruent with its
original bylaws, 75% of its members are investor relations officers (internal
staff practitioners), 12% are investor relations counselors (external consul-
tants), and 9% are vendors (NIRI, n.d.-b).
Historical Perspective
A review of NIRI’s founding provides insight into the opposing camps—
and dual nature—of investor relations. As with research, the public relations
literature contains little information on the history of investor relations,
particularly because of its relative newness.
According to the history posted on NIRI’s Web site (Morrill, 1995),
investor relations marks its beginning at 1953, when then Chairman of the
General Electric Company (GE) Ralph Cordiner ‘‘made the first
systematic effort to formalize a corporation’s relationship with its share-
holders.’’ Morrill continued, ‘‘Under his urging, a new department was
created and the term investor relations was coined’’ (emphasis added).
The GE staff practitioners played a major role in defining investor rela-
tions practice and forming NIRI. However, in a telling section derogatorily
titled ‘‘Enter the Clowns,’’ Morrill (1995) described management’s early
attempts to rely on ‘‘the experts of mass communication,’’ corporations’
public relations departments or public relations firms. Due to the small size
of internal departments, most of the work was given to consultants, most of
whom had little knowledge of Wall Street. ‘‘Shareholder relations became
transformed into publicity, promotion and pageants’’ (Morrill, 1995).
Defining most public relations firms at the time as ‘‘media messengers,’’
Morrill (1995) presented numerous examples of reporters being duped and
investors being defrauded. According to Morrill, ‘‘The word public relations
became increasingly a pejorative in Wall Street.’’ He added, ‘‘The trend to
producing, peddling and promoting half-truths and untruths, even if
cloaked in hedged language, was increasing at an accelerating rate.’’ What
clearly was press agentry public relations contributed to the void companies
faced in managing investor relations:
If delegated to public relations the skills were not there. If delegated to outside
public relations counsel, not only were skills lacking but the outsider had
difficulty keeping well enough informed. If given to finance, the numbers were
there but the communication skills were lacking. Corporate secretaries were
experienced in managing the shareholder list, but not the shareholders. Legal
counsel saw everything as a potential court case. (Morrill, 1995)
Recalling these turbulent years, Morrill (1995) defined investor relations

in two-way symmetrical terms:
Its challenge: To find ways to communicate responsibly with investors, with

the Wall Street firms who served them and with the financial press. Equally
challenging was the need to find effective ways to convey back to management
the needs, interests, attitudes and concerns of the people who buy stock, and of
the people who guide them in their decision making.
According to Morrill (1995), a new type of practitioner was needed due to

the inability of public relations people to grasp financial content and the
inability of finance people to produce required communication tactics:
‘‘The plain fact is, of course, that both sets of skills are needed—and were
needed at the outset—for the successful performance of investor relations.’’
A series of meetings and conferences led by GE pioneers in the early
1960s resulted in formation of the Investor Relations Association, the
predecessor to NIRI (Morrill, 1995). Attempts to join PRSA had been
unsuccessful. Obstacles that could not be overcome included differences
regarding the name of the specialization, ethical standards and enforcement,
and professional development training in special skills. Focusing on the first
obstacle, according to Morrill, PRSA preferred to call the specialization
financial public relations or financial relations, whereas practitioners seeking
affiliation preferred investor relations. The issue of terminology was
significant. In the minds of those active in early efforts to organize the field
of investor relations, public relations was synonymous with publicists, who
promoted rather than informed and relied on persuasion, manipulation, and
deception. ‘‘In the investor relations view, financial public relations was a
glaring oxymoron’’ (Morrill, 1995).
As stated earlier, NIRI was founded in 1969. From the outset, leaders of
the organization took great pains to differentiate NIRI members from
public relations practitioners, what NIRI directors referred to as ‘‘separat-
ing the wheat from the chaff’’ (Morrill, 1995). One director stated in the
institute’s first progress report, ‘‘Our aim is to separate ourselves from the
so-called financial public relations consultants, who operate on the fringe
of stock touting, and who are fouling the nest’’ (Morrill, 1995). NIRI
adopted a practice to conduct background checks on consultants applying
for membership ‘‘to keep the chaff out’’ (Morrill, 1995).
Interestingly, 7 years after NIRI’s founding, PRSA, in 1976, established
an ‘‘Investor Relations Section’’ for its members, renaming it the ‘‘Financial
Communications Section’’ in 1992 (PRSA, n.d.). NIRI and PRSA’s
professional interest section have coexisted over the last 32 years, with some
degree of understanding that members of the two groups differ in their
expertise and responsibilities. NIRI members are considered finance-
oriented, more so than members of PRSA’s professional interest section,
who are oriented to communication=public relations. Simplistically, the
former is responsible for communication with investors and stock analysts,
whereas the latter deals with the financial media. The two groups also differ
in the composition of their membership. NIRI’s goal from its founding has
been to maintain a membership that is predominantly corporate practi-
tioners, about 80% (Morrill, 1995), whereas PRSA’s section traditionally
attracts half or more of its members from consulting firms.
Recent Developments
David Silver (2005), president of a consulting firm and the 2009 chair of
PRSA’s Financial Communications Section, argued in a 2005 article that
financial public relations and investor relations are not the same; they
‘‘inhabit radically dissimilar environments with different audiences and skill
sets’’ (p. 14). Yet the thrust of Silver’s article was that the current environ-
ment in which publicly owned corporations operate demands the conver-
gence of investor relations and financial public relations. According to
Silver, the need for convergence has been accelerated by such factors as
corporate scandals, shareholder activism, regulatory reforms, and the
information revolution. He stated, ‘‘The PR and investor relations functions
of a company can no longer be separate—they must be integrated’’ (p. 16).
In 2006, NIRI established the Center for Strategic Communication ‘‘to

serve as an advocate for an integrated-communication approach to investor
relations and corporate communication’’ (NIRI, n.d.-a). The center was
formed as a distinct division with its own executive director; it later was
reorganized and is now named the Roundtable for Strategic Communi-
cation and Reputation Management (NIRI, n.d.-d). In February 2007,
the recently hired president of NIRI resigned after only 7 months, which
was viewed by some observers as further evidence that the institute was
changing and seeking integration with public relations. In an opinion piece
on the resignation, O’Dwyer (2007) stated, ‘‘Some leaders want IR people to
be closer to the overall PR community and financial press’’ (p. 8). The
movement, according to O’Dwyer, is spurred by growing acceptance of
the importance of nonfinancial indicators, or ‘‘intangibles,’’ on stock prices.
Indeed, a body of literature by business scholars maintains that a signifi-
cant portion of a stock’s price depends on such intangibles as customer
relationships, corporate reputation, and intellectual capital. For example,
Lev (2004) claimed that intangible assets ‘‘account for well over half the
market capitalization of public companies’’ (p. 109). He added, ‘‘In fact,
these ‘soft’ assets are what give today’s companies their hard competitive
edge’’ (p. 109). Hockerts and Moir (2004) perceived a changing role for
investor relations due to the impact of intangibles. They argued that com-
municating corporate responsibility is now a top priority for the function
because ‘‘investors increasingly consider non-financial aspects in their
assessment of companies’’ (p. 85).
Whether intangibles, recent scandals, regulatory reforms, or other factors
are driving change, investor relations has entered a new era, which Hutchins
(2008) identified as ‘‘Investor Relations Returns to Its Public Relations
Roots.’’ Describing the development of US investor relations, he stated,
‘‘Fast forward to today and we see IR again evolving, this time seemingly
back to its PR roots.’’ He cited sources from both communication and
finance to support his claim that investor relations and public relations
are converging. Among the authorities discussed was Ernst and Young’s
global vice-chair of corporate finance, who proposed a new view of investor
relations that he called ‘‘investor relationship management.’’ The new view,
according to the executive, acknowledges that the job of investor relations
officers is not only to provide data but to facilitate dialogue and manage
relationships with the investor community.
Public relations has taken on greater importance in investor relations.
Leaders in the field have called for integrated communication between
investor relations and corporate communication and for the convergence
of investor relations and financial public relations. Divisions that previously
existed, primarily because of press agentry public relations practice, have
given way to an emphasis on relationship management and two-way

communication. For example, NIRI’s current definition of investor
relations, adopted by its board of directors in March 2003, describes an
integrated function and decrees two-way communication as its purpose:
Investor relations is a strategic management responsibility that integrates

finance, communication, marketing and securities law compliance to enable
the most effective two-way communication between a company, the financial
community, and other constituencies, which ultimately contributes to a com-
pany’s securities achieving fair valuation. (NIRI, n.d.-c; emphasis added)
The new era of investor relations heightens the need for research
informed by public relations theory. This article addresses the need by
reporting findings of a nationwide study of investor relations practitioners.
The study utilized one of public relations’ most tested theories—models of
practice—to build knowledge about investor relations. Data collected on
the models also were analyzed to reflect the latest thinking regarding
theoretical dimensions that underlie the four-model typology.
THEORETICAL FRAMEWORK
Models and dimensions of public relations practice were conceptualized and

tested by J. E. Grunig and others through an extensive program of research
(e.g., J. E. Grunig, 1984; J. E. Grunig & L. A. Grunig, 1989, 1992; L. A.
Grunig, J. E. Grunig, & Dozier, 2002). According to Murphy (1989), the
theory of public relations models represents the most influential concept
in modern public relations. Botan and Hazleton (2006) later affirmed, ‘‘Over
the last 20 years, a leading body of work has developed around Symmetry=
Excellence Theory, which has probably done more to develop public rela-
tions theory and scholarship than any other single school of thought’’ (p. 6).
The four models J. E. Grunig (1984) originally conceptualized describe
typical ways in which public relations is practiced: press agentry, public
information, two-way asymmetrical, and two-way symmetrical. The models
represent a positive theory in that they describe how public relations actu-
ally is practiced. The two-way symmetrical model, however, also provides
a normative theory because it prescribes how organizations should practice
public relations to be effective and socially responsible.
J. E. Grunig and Hunt (1984) first identified the models through a review
of public relations history and developed them from a combination of com-
munication direction (one-way vs. two-way) and balance of communication
effects (asymmetrical vs. symmetrical). Although practitioners practice all
four models to some extent, they practice one model predominantly. The
predominant model practiced reveals the worldview practitioners and
organizations hold about the purpose of public relations. The following
description provides an overview of the models as they relate to this study;
more detailed information is available from multiple sources, including
those cited.
Press agentry is the oldest of the four models. Its purpose is propaganda,
and the nature of communication is one-way, with truth not being impor-
tant. Practitioners relying on this model seek favorable publicity in the mass
media and imbalanced effects that only benefit their organizations. Numer-
ous studies have shown that press agentry is ‘‘the most common form of
public relations,’’ or the model predominantly practiced by most practi-
tioners and organizations (J. E. Grunig & L. A. Grunig, 1992, p. 305). Even
the largest research project on public relations to date, the IABC Excellence
study, found that, overall, press agentry is the predominant model of
practice (J. E. Grunig et al., 1991).
The public information model describes the work of what J. E. Grunig
(1992) called ‘‘journalists in residence’’ (p. 18), who view the purpose of
public relations as disseminating factual information through the mass
media and controlled media. The nature of communication is one-way,
and although truth is important, information often is incomplete. Practice
of the model results in imbalanced effects.
The two-way asymmetrical model relies on research to fulfill its purpose
of scientific persuasion. As given in its name, the model’s nature of
communication is two-way with imbalanced effects. Practitioners utilizing
this model attempt to change the behavior of publics without changing
the organization’s behavior. They use findings from research on publics’
attitudes and behaviors to develop persuasive messages. Providing a con-
temporary example relevant to this article, Silver (2005) gave the following
advice to financial public relations practitioners: ‘‘Gather intelligence to
determine the perception of the company and then shape responses to build
reputation’’ (p. 17).
The two-way symmetrical model also relies on research, but the model’s
purpose is to generate mutual understanding between an organization and
its strategic publics. Understanding leads to the formation of relationships
that help the organization succeed and survive. Two-way communication
with a goal of balanced effects may result in either or both the organization
and publics changing their behavior. This does not mean that organizations
predominately practicing this model readily succumb to demands of publics;
rather, they utilize dialogue and negotiation to reach agreement when
possible. As touched on earlier, the two-way symmetrical model is the most
ethical and socially responsible model, and it ‘‘contributes to organizational
effectiveness more than other models’’ (J. E. Grunig & L. A. Grunig, 1992,
p. 320).
Since the models were introduced, numerous studies have tested,
critiqued, and evaluated them in different types of organizations, industries,
and countries (e.g., J. E. Grunig, L. A. Grunig, Sriramesh, Huang, & Lyra,
1995; Rhee, 2002; Roper, 2005). One of the most recent tests of the models
was Lim, Goh, and Sriramesh’s (2005) study, in which the models (as well as
other principles of Excellence theory) were applied to public relations prac-
tices in Singapore. Utilizing both quantitative and qualitative methods, the
researchers found that mean scores on all four models were within a close
range (3.24 to 3.54 on a 5-point scale), which—in conjunction with other
findings—suggested that Singapore practitioners employ a mixed-motives
model characterized by ‘‘a combination of asymmetrical and symmetrical
tactics’’ (Lim et al., 2005, p. 332). However, the researchers also reported
that ‘‘about 82% of the respondents indicated that the main purpose of
public relations was to get publicity for their organization, and those who
were interviewed saw publicity as the main focus of their public relations
activities’’ (p. 329). The researchers concluded, ‘‘Clearly, these public rela-
tions activities are oriented toward the press agentry model’’ (p. 330).
Despite numerous studies on the models, none has found predominant
practice of the two-way symmetrical model across its sample. As a result,
the two-way symmetrical model—an ideal for public relations practice—
has seemed to be unattainable. In addition, as J. E. Grunig (1992) and L.
A. Grunig et al. (2002) asserted that the two-way symmetrical model is
the most effective model for achieving organizational objectives, public
relations practice has appeared to be based on an ineffective foundation,
thus hampering the function from contributing to organizational value to
its maximum capabilities.
Although studies testing the models have included various types of
organizations and industries, few researchers have paid attention to public
relations’ specializations, or subfunctions, defined by the PRSA Body of
Knowledge Task Force (1988) as media, internal=employee, consumer,
investor, community, government, and fundraising=donor relations. An
important exception was the IABC Excellence study, which measured prac-
tice of the four models in eight communication programs dedicated to spe-
cific publics—the seven subfunctions just mentioned and member relations
(L. A. Grunig et al., 2002). Scores were obtained from approximately 300
heads of public relations departments, who were instructed to provide
estimates for up to three programs managed by their department. Findings
showed that the different subfunctions predominantly practiced different
models. For example, the predominant model for media and community
relations programs was press agentry, whereas the predominant model for
customer relations programs was the two-way asymmetrical model.

Importantly, the study found that investor relations programs predomi-
nately practiced the two-way symmetrical model.
Reagan, Sumner, and Hill (1992) also examined the four models in
relation to the subfunctions of public relations. They measured the models
with a sample of 136 practitioners in the state of Washington, who self-
identified their job function. The sample consisted of members of PRSA
and supervisors of public relations internships—both in-house staff practi-
tioners and consultants. Correlation analysis found a significant, negative
relationship between investor relations practitioners’ scores and the press
agentry model. Although not statistically significant, analysis also showed
a negative correlation between investor relations and the public information
model, and positive relationships with the two-way models.
Findings of these two studies suggest that investor relations programs
tend to practice the two-way symmetrical model. Public relations practi-
tioners specializing in investor relations rely on two-way communication.
They reject the press agentry model, which research shows is the model
predominantly practiced by practitioners and organizations in aggregate.
In a recent development, L. A. Grunig et al. (2002) proposed a reconcep-
tualization of the historical models into eight dimensions of public relations
practice. According to the scholars, the time had come ‘‘to develop a more
comprehensive theory that goes beyond the typology represented by the four
models’’ (p. 348). They identified four sets of variables, or eight dimensions,
which underlie the models: (a) asymmetry=symmetry, (b) one-way=two-way,
(c) mediated=interpersonal tactics, and (d) unethical=ethical practice. The
first four dimensions were part of J. E. Grunig’s (1984) original conceptua-
lization of the models; the latter four emerged from subsequent studies.
L. A. Grunig et al. (2002) developed two types of scales to measure the
dimensions: combined scales consisting of paired variables and separate
scales for each dimension. Reliability tests showed that the separate scales
were more reliable; therefore, they were adopted for analysis. The research-
ers had collected data on all but the last two dimensions in the IABC Excel-
lence study. They tested reliability of the six scales on four programs for
specialized publics—those with the largest sample sizes. Investor relations,
represented by only 53 cases, was not included. The researchers found that
the dimension scales were either more or equally reliable as the scales mea-
suring the four models. Correlation analysis of the new scales with scales
measuring excellent public relations strongly supported the revised concep-
tualization of dimensions. Results confirmed that two-way communication
and symmetrical effects are key determinants of excellent public relations.
Sha (2005) claimed that the evolution from models to dimensions was
inevitable because it allows scholars to conceptualize the practice of public
relations in a more meaningful way. A review of the literature since 2002,

however, identified only a few studies that have used dimensions and their
usage has been inconsistent. For example, as just described, L. A. Grunig
et al. (2002) adopted separate scales to measure the dimensions, but Sha
(2005), in her study, measured the dimensions on combined scales. Yun
(2006) used a combined scale to measure direction of communication
(one-way=two-way) and separate scales to measure the asymmetrical and
symmetrical dimensions. None of the studies utilizing dimensions has dealt
with investor relations.
The few studies that have investigated models of practice in investor
relations have been limited in their ability to provide knowledge about the
function. Research by Reagan et al. (1992) and Petersen and Martin
(1996) was confined to one state, Washington and Florida, respectively.
The IABC Excellence study, as reported in L. A. Grunig et al. (2002), relied
on responses from the heads of public relations departments, whom
Petersen and Martin found seldom manage the investor relations function.
A study that is national in scope and includes practitioners oriented to
finance, as well as those oriented to public relations, is needed to advance
understanding of investor relations. The new era of investor relations
described earlier reinforces the need for such research.
Based on the problem and literature reviewed, the following hypotheses
were posed for the study reported here:
H1. The two-way symmetrical model is more predominant in investor relations

practice than any of the three other models of public relations.
H2. The two-way communication dimension is more predominant in investor
relations practice than the one-way communication dimension.
H3. The symmetrical dimension is more predominant in investor relations
practice than the asymmetrical dimension.
H4. The practice of investor relations, as represented by models and dimen-
sions, does not differ by the orientation of practitioners, whether finance
or corporate communication=public relations.
METHODOLOGY
The study’s method of observation was a survey of a stratified sample of

investor relations practitioners. Self-administered questionnaires distributed
via the US Postal Service were used to gather data.
The population of interest was investor relations officers employed by
publicly owned corporations in the United States. As no exhaustive list of
such practitioners exists, the population defined for study consisted of
members of NIRI and PRSA’s Financial Communications Section. The
two groups were selected to ensure participation of both practitioners with a

finance orientation and practitioners with a corporate communication=
public relations orientation.
Only members with a corporate affiliation were eligible. As a result, 181
members of PRSA’s Financial Communications Section were eligible, and
all were chosen. The sample from NIRI was drawn from the corporate
section of the institute’s membership directory, using a random starting
point and interval sampling to arrive at 181 participants. This brought the
sample to 362.
The questionnaires were mailed with a cover letter explaining the purpose
of the study and a stamped, preaddressed return envelope. Cover letters
were printed on stationery and personalized by mail merge. The return
envelopes were coded by number to facilitate follow-up with nonrespon-
dents. Two weeks after the original mailing, a follow-up mailing was sent,
which included a different personalized cover letter, the questionnaire,
and return envelope. The detailed survey process was deemed necessary to
achieve a response rate as close to 50% as possible.
The questionnaire contained 16 items that measured the four models of
public relations, four items each. The items were developed and refined by
J. E. Grunig through testing in numerous studies (J. E. Grunig & L. A.
Grunig, 1992). Kelly (1995b) modified them to measure models of fundrais-
ing. For example, she changed the press agentry item, ‘‘Public relations and
publicity in the press mean essentially the same thing,’’ to ‘‘Fund raising and
campaigning mean essentially the same thing’’ (p. 114). For this study, items
with the term public relations were changed to refer to investor relations.
Other slight modifications were made to the items so that investor relations
practitioners would find them relevant to their programs. The 16 items are
listed in tables reporting results of the study.
A fractionation scale was adopted from the researchers just mentioned
for use in this study. Respondents were asked to give a number on a scale
from 0 to as high as they wanted to go. They were told that 100 was the
average response on all of the items. According to Barnett, Hamlin, and
Danowski (1982), fractionation scales have many advantages, including that
they allow for considerable variance.
The questionnaire also included four closed-ended, nominal items
measuring three variables dealing with respondents’ orientation: (a) area
of past experience, or background; (b) title of the person to whom he or
she reports, or structural location; and (c) training and education in the
two disciplines of finance and public relations=communication. Respon-
dents were limited to choosing one answer per item. Several demographics
also were measured. The questionnaire was pretested, which resulted in
wording changes in some items.
RESULTS
Of the 362 questionnaires mailed, 41 were returned incomplete—22 because

the practitioner fell outside the parameters of the defined population (e.g.,
did not work in investor relations) and 19 because the survey was undeliver-
able (e.g., the company had moved) or the practitioner declined to partici-
pate. The incomplete returns reduced the sample size to 321. The number
of completed questionnaires received totaled 145, resulting in a 45%
response rate. Although the rate was slightly less than optimal, it was
adequate for generalizing findings to the population selected for study.
Based on demographics, participants in this study do not appear to differ
from the population from which they were drawn. Of the 145 respondents,
88 (60.6%) are members of NIRI, and 57 (39.3%) belong to the PRSA
Financial Communications Section. The majority of the respondents
(60.4%) are men, and the corporations represented range from small to large
cap (i.e., market capitalization) companies in all parts of the country.
Practitioner Orientation
The study’s 145 respondents divide almost equally on their area of past
experience, or background. Whereas 45% say that finance best represents
their past experience, 42% say their background is in communication=public
relations; 13% selected the Other option. These findings differ from back-
ground percentages reported in NIRI’s most recent membership survey
(Thompson, 2005), particularly the communication=public relations per-
centage (42% vs. 23%). The fact that this study found a higher percentage
is not surprising as its sample included PRSA members, although the back-
ground proportions of finance (45%) and communication=public relations
(42%) do not mirror association breakdown of respondents (60.6% NIRI
members & 39.3% PRSA members).
The findings do correspond to the background percentages of NIRI’s
(n.d.-b) ‘‘Member Profile’’ presented on the association’s Web site, which
reports all areas in which members have experience (i.e., members could
select more than one area to describe their background). According to the
current profile, 49% of NIRI members have a background in ‘‘Accounting=
Finance’’ and 46% have a background in ‘‘Corporate Communications=
PR=Media.’’ Another 85% of the members claim a background in other
areas, such as ‘‘Business Development=Marketing Sales.’’
Turning to the second indicator of orientation, this study found that
finance best describes the structural location of investor relations officers
in companies represented in NIRI or PRSA’s Financial Communications
Section. Four times as many respondents report to the CFO=Treasurer
(46.9%) than to the chief communication officer (CCO; 11.7%). Almost

one-third (31%) report to other members of the C-Suite, such as the
chairman or CEO, and 10% report to a diverse group in the category of
Other. In retrospect, the indicator was flawed because the orientation of
practitioners reporting to senior managers other than the CFO and CCO
is unknown. Regardless, this study’s findings are congruent with those of pre-
vious studies, including NIRI’s most recent membership survey (Thompson,
2005) and the public relations study by Petersen and Martin (1996).
Results regarding training and education in finance and in public
relations=communication reveal that almost two-thirds of NIRI and
PRSA’s Financial Communications Section members (62.7%) have training
and education in both disciplines, although preparation in finance is more
prevalent. Whereas 95% of the respondents have some training in finance,
ranging from continuing education courses to graduate degrees, just 67%
have similar training in public relations=communication. Only 30% have a
formal degree in public relations=communication, as compared to 51%
who have a formal degree in finance. Also of interest, 37% of the respon-
dents report a graduate degree in finance, whereas merely 8% have a gradu-
ate degree in public relations=communication.
Results indicate that most of today’s investor relations officers are
cross-trained in both finance and public relations=communication, regard-
less of the discipline of their formal educational degrees. The findings
support the assessment of a senior partner with a leading search firm,
who said companies expect investor relations officer candidates to have
‘‘deep financial and business acumen, strong relationships with the Street,
and the ability to provide strategic communications counsel’’ (NIRI, 2008).
Models
Respondents were asked to use the open-end fractionation scale to estimate
how well each of the 16 items measuring the public relations models
described their investor relations program. Based on results of previous
studies using the scale, a positive skew was expected. The square root of
the response for each item was computed to reduce the skew to approxi-
mately a normal distribution. Examination of the data set indicated no out-
liers. Mean scores were calculated and summative indexes of each of the four
models were constructed. A mean of 10 represented average. Cronbach’s
alphas were computed for the indexes to test the reliability of each model.
Cronbach’s alphas of reliability for the four model indexes range from .56
to .70. There is no universally accepted standard for how high Cronbach’s
alpha should be; however, Bowers and Courtright (1984) argued that
alpha measures can be as low as .60. By this standard, all but the public
information model are acceptably reliable. Analyses showed that reliability

for public information and two of the other model indexes would increase
by removing one item from each, but the resulting alphas would still be
low, ranging from .61 to .79. Plans to utilize all 16 items to analyze dimen-
sions contributed to the decision to retain the full models. Furthermore, the
alphas in this study are similar to those found in previous tests of the models
(e.g., J. E. Grunig & L. A. Grunig, 1989; L. A. Grunig et al., 2002). J. E.
Grunig and L. A. Grunig (1989) defended the reliability of .60 found in
much of their research and stated,
One also could argue that the theoretical consistency of the indices is at least
as important, and perhaps more important, than their empirical reliability.
That is, the items in an index should follow the logic of the theory they
measure. (p. 34)
Table 1 presents the mean scores of the respondents on the model items
and indexes. These mean scores show that the two-way symmetrical model is
the public relations model predominantly practiced by investor relations
officers who belong to NIRI or PRSA’s Financial Communications Section.
The findings support the IABC Excellence study’s findings on investor
relations programs (L. A. Grunig et al., 2002) but contradict findings of
almost all other studies measuring the models, including the IABC Excel-
lence study’s findings on overall public relations practice (J. E. Grunig
et al., 1991). In other words, whereas practitioners and organizations, in
general, predominantly practice press agentry public relations, investor rela-
tions officers and their publicly owned corporations predominantly practice
two-way symmetrical public relations with investor publics.
At 7.95 (SD ¼ 2.85), this sample’s mean score on the two-way symmetri-
cal model is the highest of the four models. Most revealing of use of the
model are respondents’ above-average scores on the item, ‘‘The purpose
of this program is to develop mutual understanding between the manage-
ment of my company and financial publics that the organization affects.’’
Mean scores on the other three models are substantially lower: 6.48
(SD ¼ 3.25) on the two-way asymmetrical model, 6.34 (SD ¼ 2.79) on the
press agentry model, and 4.94 (SD ¼ 2.93) on the public information model.
The extremely low mean score on the public information model largely is
due to the fact that many respondents selected 0, or does not describe, for
items measuring the model. For example, almost half of the respondents
(46.2%) selected 0 for the item, ‘‘In investor relations, we disseminate
accurate information but do not volunteer unfavorable information.’’
L. A. Grunig et al. (2002) found a similar low mean score on the public
information model in investor relations programs (M ¼ 4.75).
TABLE 1
Mean Scores on Items and Indexes Measuring Four Models of Public Relations Practiced by
Investor Relations Practitioners
Model and item Mean SD
Press agentry model

We determine how successful an investor relations program is from the 8.33 3.65
number of people who attend an event (i.e., annual meetings and
security analyst meetings) or who purchase the company’s stock.
The purpose of investor relations is, quite simply, to get publicity for my 5.65 3.52
company in the financial press.
For this organization, investor relations and publicity in the financial press 6.38 3.93
mean essentially the same thing.
In investor relations, we mostly attempt to get favorable publicity in the 5.10 4.37
media and keep unfavorable publicity out.
Press agentry model index 6.34 2.79
Cronbach’s alpha .70
Public information model
Investor relations is more of a neutral disseminator of information than an 6.37 4.53
advocate for the organization or a mediator between management and
financial publics.
Nearly everyone is so busy writing news stories, producing publications or 5.39 4.39
making presentations that there is no time to do research.
Keeping a clipping file is about the only way we have to determine the 3.59 3.98
success of an investor relations program.
In investor relations, we disseminate accurate information but do not 4.38 4.69
volunteer unfavorable information.
Public information model index 4.94 2.93
Two-way asymmetrical model
After completing an investor relations program, we do research to 7.23 4.09
determine how effective the program has been in changing investors’
attitudes.
Before starting an investor relations program, we look at attitude surveys 5.29 4.47
to make sure we describe the company in ways our financial publics
would be most likely to accept.
Before beginning an investor relations program, we do research to 6.69 4.45
determine attitudes of financial publics toward the company and how
they might be changed.
In investor relations, our broad goal is to persuade financial publics to 6.70 5.04
behave as the organization wants them to behave.
Two-way asymmetrical model index 6.48 3.25
Two-way symmetrical model
This organization believes investor relations should provide mediation to 6.10 4.47
help management and financial publics negotiate conflicts.
The purpose of this program is to develop mutual understanding between 11.42 3.61
the management of my company and financial publics that the
organization affects.
(Continued )
TABLE 1
Continued
Model and item Mean SD
Our purpose is to change the attitudes and behavior of management as 8.11 4.38
much as it is to change the attitudes and behavior of financial publics.
Before starting an investor relations program, we do surveys or informal 6.11 4.45
research to find out how much management and our financial publics
understand each other.
Two-way symmetrical model 7.95 2.85
Cronbach’s alpha for reliability .61
Note. N ¼ 145. Scores are the square roots of responses on a fractionation scale for which
respondents were told that 100 is a typical response on all items. Thus, a mean of 10 in this table
represents a typical response.
The differences between the mean score on the two-way symmetrical

model and mean scores on the other three models are statistically signifi-
cant. Two-tailed, paired sample t-tests produced the following results:
two-way symmetrical model mean versus (a) two-way asymmetrical model
mean, t ¼ 6.05, df ¼ 142, p < .001; (b) public information model mean,
t ¼ 9.67, df ¼ 142, p < .001; and (c) press agentry model mean, t ¼ 5.38,
df ¼ 142, p < .001.
Based on these findings, Hypothesis 1 is supported. Investor relations
practitioners who belong to NIRI or PRSA’s Financial Communications
Section predominantly practice the two-way symmetrical model of public
relations. Their use of the model differs substantially and significantly from
their use of the other three models. Results provide evidence that the
normative theory of how public relations should be practiced is, indeed,
actually practiced in investor relations.
Dimensions
Data on the models were reanalyzed to follow L. A. Grunig et al.’s (2002)
reconceptualization of the models into underlying dimensions. As explained
earlier, the IABC Excellence researchers identified eight dimensions and
analyzed data on the first six: asymmetry, symmetry, one-way, two-way,
mediated tactics, and interpersonal tactics. Data regarding ethics were not
available. This study did not collect data on mediated and interpersonal tac-
tics or ethics; therefore, its analysis is limited to the first four dimensions of
asymmetrical and symmetrical effects, and one-way and two-way communi-
cation. Following the IABC Excellence researchers, it adopted separate
measurement scales for each dimension. Model items were reorganized by
dimensions, emulating selection of the Excellence researchers. Results of the

analysis are presented in Table 2.
Similar to results on the models, analysis of the dimensions shows that
symmetrical effects (M ¼ 8.56, SD ¼ 2.96) and two-way communication
(M ¼ 6.33, SD ¼ 3.54) are predominant characteristics of the work of
investor relations officers who belong to NIRI or PRSA’s Financial Com-
munications Section. Mean scores on the asymmetrical effects and one-way
communication dimensions are substantially lower, 5.39 (SD ¼ 3.73) and
5.93 (SD ¼ 2.27), respectively. Two-tailed t-tests showed that the difference
of means between the dimensions of symmetrical effects and asymmetrical
effects is statistically significant (t ¼ 8.92, df ¼ 142, p < .001). However,
the difference of means between the dimensions of one-way communication
and two-way communication is not statistically significant (t ¼ 1.29,
df ¼ 142, p > .05).
The findings regarding Hypothesis 2 are inconclusive. Whereas investor
relations practitioners in this sample use two-way communication substan-
tially more than one-way communication, the difference in use is not signifi-
cant. Any conclusions about predominant use of two-way communication
in investor relations practice must be qualified pending future research.
On the other hand, Hypothesis 3 is supported. Symmetrical effects, more
so than asymmetrical effects, characterize the investor relations programs
of NIRI and PRSA Financial Communication Section members.
Cronbach’s alphas for the dimension indexes range from a low of .51 for
the symmetrical effects index to a high of .82 for the two-way communi-
cation index. These measures of reliability mirror those found by L. A.
Grunig et al. (2002) in their analysis of dimensions of four programs other
than investor relations.
As shown in Table 2, reorganization of the 16 model indicators resulted
in uneven numbers of items measuring the dimensions: three indicators each
for asymmetrical and symmetrical effects, four indicators for two-way
communication, and six indicators for one-way communication. This might
be the reason for the inconclusive findings on the direction of communi-
cation dimensions. Future studies should modify and standardize the num-
ber of items used to measure the dimensions, which may result in significant
differences between use of one-way and two-way communication, as well as
improve the dimensions’ reliability.
Differences by Practitioner Orientation

A series of one-way analysis of variance was conducted to determine if
practitioners oriented to finance differ in their practice of investor relations
from practitioners oriented to corporate communication=public relations.
TABLE 2
Mean Scores on Items and Indexes Measuring Four Dimensions of Public Relations in
Investor Relations Programs
Dimension and item Mean SD
Asymmetrical effects
In investor relations, we disseminate accurate information but do not 4.38 4.69
volunteer unfavorable information.
In investor relations, we mostly attempt to get favorable publicity in the 5.10 4.37
media and keep unfavorable publicity out.
In investor relations, our broad goal is to persuade financial publics to 6.70 5.04
behave as the organization wants them to behave.
Asymmetrical effects index 5.39 3.73
Symmetrical effects
This organization believes investor relations should provide mediation to 6.10 4.47
help management and financial publics negotiate conflicts.
The purpose of this program is to develop mutual understanding between 11.42 3.61
the management of my company and financial publics that the
organization affects.
Our purpose is to change the attitudes and behavior of management as 8.11 4.38
much as it is to change the attitudes and behavior of financial publics.
Symmetrical effects index 8.56 2.96
One-way communication
We determine how successful an investor relations program is from the 8.33 3.65
number of people who attend an event (i.e., annual meetings and
security analyst meetings) or who purchase the company’s stock.
The purpose of investor relations is, quite simply, to get publicity for my 5.65 3.52
company in the financial press.
For this organization, investor relations and publicity in the financial 6.38 3.93
press mean essentially the same thing.
Investor relations is more of a neutral disseminator of information than 6.37 4.53
an advocate for the organization or a mediator between management
and financial publics.
Nearly everyone is so busy writing news stories, producing publications 5.39 4.39
or making presentations that there is no time to do research.
Keeping a clipping file is about the only way we have to determine the 3.59 3.98
success of an investor relations program.
One-way communication index 5.93 2.27
Two-way communication
After completing an investor relations program, we do research to 7.23 4.09
determine how effective the program has been in changing investors’
attitudes.
Before starting an investor relations program, we look at attitude surveys 5.29 4.47
to make sure we describe the company in ways our financial publics
would be most likely to accept.
(Continued )
TABLE 2
Continued
Dimension and item Mean SD
Before beginning an investor relations program, we do research to 6.69 4.45

determine attitudes of financial publics toward the company and how
they might be changed.
Before starting an investor relations program, we do surveys or informal 6.11 4.45
research to find out how much management and our financial publics
understand each other.
Two-way communication index 6.33 3.54
The three variables measuring practitioner orientation—background,

structural location, and training and education in finance and public
relations=communication—were the predictor variables, and the four public
relations models and four dimensions served as dependent variables. The
analyses found no significant differences between either model scores or
dimension scores for any of the variables dealing with respondents’ orien-
tation. In other words, regardless of background, structural location, and
training and education, investor relations officers who belong to NIRI or
PRSA’s Financial Communications Section predominantly practice the
two-way symmetrical model of public relations and their work is character-
ized by symmetrical effects and, to some degree, two-way communication.
Hypothesis 4 is supported: The practice of investor relations does not differ
by the orientation of its practitioners, whether their orientation is finance or
public relations.
DISCUSSION AND CONCLUSIONS
Results of this study have important implications for publicly owned

corporations in the United States, investor relations practitioners, and the
profession of public relations. Predominant practice of the two-way sym-
metrical model by NIRI and PRSA’s Financial Communications Section
members means that these investor relations officers are well-equipped to
help their corporations cope with conditions of their current environments.
Loss of investor confidence resulting from scandals, imposed regulatory
requirements, and shareholder activism—as well as multiple problems
related to the economic crisis of the late 2000s—can best be addressed by
use of the two-way symmetrical model, which is the most effective and
socially responsible model.
It is recalled that the purpose of the two-way symmetrical model is to

generate mutual understanding with strategic publics, which leads to
relationships that help the organization succeed and survive. Findings of
the predominant practice of the model in this study and the IABC Excel-
lence study, as reported in L. A. Grunig et al. (2002), suggest that investor
relations officers and their corporations have embraced a concept known as
relational investing, which aims to build long-term relationships with inves-
tor publics in an effort to secure patient capital (Lowenstein, 1996). Indivi-
duals and institutions that have a relationship with a public company are
more likely to be long-term investors, which helps the company avoid
short-term fluctuations in its stock price. One of the problems identified
by investor relations officers in Laskin’s (2006) study was the dichotomy
between management’s horizon in running a company and Wall Street’s
fixation with short-term earning expectations. In other words, building
relationships with investors through two-way symmetrical practice has
direct financial benefits for publicly owned corporations.
The findings provide empirical support for current efforts to integrate
and converge investor relations with corporate communication and financial
public relations. Predominant practice of the two-way symmetrical model
and its underlying dimensions of symmetrical effects and—to some degree—
two-way communication is shared by practitioners oriented to finance and
those oriented to corporate communication=public relations. This shared
way of practice, which also reveals a shared worldview about the purpose
of investor relations, represents a common ground for building cooperation
and partnerships. Elimination of opposing camps, grounded in history and
described earlier in this article, is necessary if investor relations is to address
such factors as the impact of intangibles on stock prices. Furthermore, find-
ings reported here provide evidence that public relations practitioners spe-
cializing in investor relations have matured beyond press agentry practice,
which eliminates the primary historical reason for separation.
A key element in the two sides coming together is increased cross-training
for practitioners in both finance and public relations. Although a high degree
of cross-training was found in this study’s sample, differences in the amount
of training and education in the two disciplines should alert public relations
educators to recruit more business students to their courses. Executive
education programs similar to those offered by business schools should be
increased. Joint sponsorship of seminars and workshops with NIRI should
be explored, from the local to the national level. Public relations educators
also should encourage their undergraduate and graduate students to specia-
lize in investor relations. The reward of high salaries could be used to entice
students to minor in finance. As NIRI President and CEO Jeffrey Morgan
(cited in NIRI, 2008) recently explained, investor relations officers are
‘‘facing an increasingly complex business and legal environment that requires

practitioners to broaden their skills set in order to meet the needs of the
business and be effective members of the corporate leadership team.’’
Results of this study also have important implications for scholarship.
First, the study adds to the body of knowledge on investor relations,
which—as detailed earlier—included little research from a public relations
perspective and even fewer studies utilizing public relations theory. Findings
of this study increases understanding of investor relations and can be used
to inform future research, whether the research is conducted by business
or public relations scholars.
The study also contributes to theory building in public relations. Its
investigation of investor relations advances knowledge on relationship man-
agement and helps substantiate the discipline’s claim on the specialization.
Results add to ongoing research on the models and dimensions. Signifi-
cantly, this study is the first to find predominant practice of the two-way
symmetrical model across its sample. The previous absence of such findings
has fueled criticism of the model theory and—arguably—contributed to
L. A. Grunig et al.’s (2002) decision to abandon the models in favor of
dimensions. Results reported here refute critical scholars, such as Pieczka
(1996), who have argued that the symmetrical model is ‘‘a utopian ideal,’’
one ‘‘that no large and powerful organization ever does or would use’’
(L. A. Grunig et al., 2002, p. 310). This study shows that the two-way
symmetrical model does exist in the real world, and it can be found in the
bastion of capitalism—publicly owned corporations in the United States.
The power of investor publics to impact a public corporation may be the
reason that this study found predominant practice of the two-way sym-
metrical model. It also could help explain why no differences were found
between mean scores on the models and dimensions by practitioners’ orien-
tation. L. A. Grunig (1992) argued that, because of their power to constrain
an organization, stockholders are one of three priority publics for transna-
tional companies and public relations practitioners in these organizations
should respond to them first. Publicly owned corporations, by definition,
need investment capital to succeed and survive; therefore, they are depen-
dent on stockholders who provide capital. The inherent power of investor
publics may mean that practitioners and corporations have little choice
but to practice two-way symmetrical public relations in investor relations
programs. In support of this hypothesis, J. E. Grunig and L. A. Grunig
(1992) concluded from previous research that organizations may practice
different models for programs aimed at different publics, stating, ‘‘For some
programs . . . symmetrical communication may be the only choice’’ (p. 307).
Turning to limitations of the study, only members of NIRI and PRSA’s
Financial Communications Section were included in the sample. Other
practitioners may practice investor relations differently. The sample

excluded consultants, an important segment of investor relations practice.
It is recalled that consultants were harshly criticized for their press agentry
behavior in Morrill’s (1995) history of NIRI. It may be that including them
in the study would have produced very different results. Furthermore, this
study’s investigation of the dimensions underlying investor relations practice
was limited in that only four of the eight dimensions were included. Future
research measuring the full complement of dimensions, as dictated by the
theory, is needed.
Regarding suggestions for future research, studies replicating this study
should be conducted. Comparison of results would be valuable. Additional
studies that included consultants would answer questions about possible dif-
ferences between the two types of practitioners. More scholarship is needed
on the power of publics in determining how public relations is practiced. It
may be that current thinking about imbalance of power between organiza-
tions and their publics is flawed. Findings of this study demonstrate that
investor relations represents a rich area for research. For example, relation-
ship management theory would benefit from studies using the coorientation
method to measure relationships between publicly owned corporations and
their investors. Studies on issues related to integration and convergence are
needed to advance investor relations practice. A qualitative study of best
practices would be insightful and could provide the basis for additional
theory building.
In conclusion, public relations scholars are urged to pay more attention
to investor relations. Similar to the calls for greater integration in its prac-
tice, they should join with business scholars to build knowledge about this
important function.
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Journal of Public Relations Research, 22(2):182–208, 2010

Copyright # Taylor & Francis Group, LLC

Investor Relations: Two-Way

Although public relations claims investor relations as one of its specializations,

Investor relations represents one of public relations’ most unfortunate

Correspondence should be sent to Kathleen S. Kelly, Professor, Department of Public

in public relations scholarship, even though the discipline claims investor

BACKGROUND AND LITERATURE

Stephen Schultz (cited in McCartney, 2003), then director of corporate

principle that the relationship between investor publics and corporate

of their study was to investigate the status of theory building in public

Finance Versus Public Relations

Conventional wisdom among public relations scholars and practitioners consid-

Statistics from the leading professional association of US investor rela-

Recalling these turbulent years, Morrill (1995) defined investor relations

Its challenge: To find ways to communicate responsibly with investors, with

According to Morrill (1995), a new type of practitioner was needed due to

In 2006, NIRI established the Center for Strategic Communication ‘‘to

given way to an emphasis on relationship management and two-way

Investor relations is a strategic management responsibility that integrates

Models and dimensions of public relations practice were conceptualized and

customer relations programs was the two-way asymmetrical model.

relations in a more meaningful way. A review of the literature since 2002,

H1. The two-way symmetrical model is more predominant in investor relations

The study’s method of observation was a survey of a stratified sample of

two groups were selected to ensure participation of both practitioners with a

Of the 362 questionnaires mailed, 41 were returned incomplete—22 because

(46.9%) than to the chief communication officer (CCO; 11.7%). Almost

information model are acceptably reliable. Analyses showed that reliability

Model and item Mean SD

Press agentry model

Model and item Mean SD

The differences between the mean score on the two-way symmetrical

dimensions, emulating selection of the Excellence researchers. Results of the

Differences by Practitioner Orientation

Dimension and item Mean SD

Dimension and item Mean SD

Before beginning an investor relations program, we do research to 6.69 4.45

The three variables measuring practitioner orientation—background,

DISCUSSION AND CONCLUSIONS

Results of this study have important implications for publicly owned

It is recalled that the purpose of the two-way symmetrical model is to

‘‘facing an increasingly complex business and legal environment that requires

practitioners may practice investor relations differently. The sample

Grunig, J. E. (1984). Organizations, environments, and models of public relations. Public

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