Tuesday, March 28, 2023

Know Your Investor (KYI) – Empirical Way to Enhance IR Teams’ Efficacy

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The role of the Investor Relations (IR) department is exponential as it maintains a balance between finance and communication which serves as a catalyst for the success of businesses. However, the absence of Know Your Investor (KYI) brings consequences otherwise, as IR teams can not meet digitally advancing financial operations. Furthermore, handling huge datasets and meeting shareholder demands become challenging for company owners.  

Know your investor services assist the IR team in handling the transmission of information across personnel associated with the company. This way, they can create a transparent relationship between stakeholders and business owners. Later, companies can avail efficient management of resources, funding, and shareholders’ shares. This article further discusses how investor authentication services enable the IR department to ensure high revenue generation by building long-term partnerships. 

Insights into the Responsibilities and Contributions of the IR Department

Stakeholders are the core elements of any business as they provide financial support and serve as a backup in case it experiences loss. Similarly, investors accelerate companies’ growth by helping them generate more revenue in less time. Therefore, it is empirical for businesses to establish strong and transparent relationships with their lenders. To make this process easier and risk-free, businesses require investor verification services. They streamline stakeholder onboarding by automating data handling and communication. 

Businesses need to line out their investors’ requirements before moving to usual operations and plan their policies accordingly. IR teams help companies establish secure partnerships by decreasing the need for manual identity verification. Investor authentication solutions enable businesses to validate sources of income and run background checks to ensure the entity was not part of any criminal activity. Hence the IR department can bridge companies to potential growth-promising lenders.

Role of the IR Department 

In order to accelerate their disappearance from scratch and move towards swift revenue generation, businesses often associate with more than one stakeholder. In case any entity has a compromised reputation in some other region, was involved in illicit activities such as money laundering, or is using illicit funds can result in companies’ downfall. Furthermore, businesses will attract regulatory scrutiny with a high chance of non-compliance penalties. This is when the IR department plays its role.

With know your investor solutions, IR teams can lessen the burden they face during manual onboarding and identity verification. Furthermore, they can assist businesses in reaping secure growth. Read on to learn more about the roles of the IR department:

  • Keeps lenders in the loop regarding profits, changes in operational policies, work strategies, financial standing, and managerial decisions
  • Builds reliable, transparent, and trustworthy relationships with stakeholders
  • Carries out robust identity verification for secure investor onboarding and ensuring long-term financial aid 
  • Establishes receptive capital markets for generating future funding and keeps financial backup for businesses for unforeseen losses
  • Implement the latest know your investor regulations to prevent legal consequences 
  • Collects and conveys feedback on intervals to tailor business strategies according to investors’ demands

Automating the IR Team by Integrating Online Investor Verification Services 

Businesses, whether they are established companies, startups, or burgeoning corporate firms, require investor onboarding at some stage. While economic disparity imbalances revenue generation, lenders help maintain financial standing. Furthermore, there are a variety of stakeholders in the marketplace and IR teams choose the relevant ones by using investor verification services. 

The AI-powered identity verification also outlines risks associated with crowdfunding platforms, venture capital, and P2P lenders for preventing investment scams. With access to global records, IR teams can cross-verify investors to restrict the onboarding of white-collar or other criminals. As a result, this sub-division contributes to pacing up revenue generation as well as speedy growth. 

Sharing Company Executes’ Burden

Business executives, including MDs, supervisors, and CEOs handle various tasks regularly such as corporate meetings. In this process, directly updating stakeholders and communicating day-to-day strategies become tiresome. The IR teams share the company personnel burden and serve as an intermediary. Moreover, by integrating know your investor checks, they can further increase efficiency while restricting fraud risks.

Compliance with Sarbanes-Oxley Act

The 2002’s Public Company Accounting Reform and Investor Protection Act increases identity verification obligations for companies. The guidelines include submitting reports regarding investments, profits, trading, revenue generation, and other financial activities. Investor verification online solutions help IR teams adhere to the requirements put forth in the Sarbanes-Oxley Act. Furthermore, they can automate information handling and directly report to authorities. Hence, investor verification services ultimately aid in securing partnerships. 

Concluding Remarks

With online investor verification in place, the IR department can enhance communication, keep lenders updated regarding company operations, and track financial dealings. Being the bridging force between businesses and lenders, this subdivision helps accelerate combined growth. Furthermore, integrating know your investor solutions automate the functioning of the IR department, which leaves fewer chances of discrepancies. This way, businesses can mark tremendous growth while shifting the burden of dealing with shareholders to IR teams. 

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