2023 Trends Report: Corporate and financial communications

What do you think of when you hear about corporate and financial communication? That's the question we asked the artificial intelligence behind this image. The result? An illustration in the style of Rembrandt. At NATIONAL corporate communications can include a multitude of aspects. This well-rounded field could only be represented by something as complex and interesting as a city where past and future exist.

Our teams of experts in corporate and financial communication are here to support you in the decisions ahead. To better prepare you, here are some of the trends that our experts foresee for 2023:

Recruitment will remain a challenge for everyone

This year, the job market is undergoing enormous changes. Many positions are available, but few are filling them. Strategies are multiplying to stand out from the competition. So how do you describe a great employer?

Offering more weeks of holiday, a gym membership, personal time off, are all examples of arguments that can make a difference to a candidate. However, have you thought about the values promoted by the company? This is where you score points.

Nowadays, employees need to feel accepted in all areas of their lives. Promoting diversity and inclusion should also be part of your company's DNA. Highlighting their good works both personally and professionally is an asset. You need to make a real connection with each of them before you even talk about their skills and educational background.

The advantage of being able to manage their time from home or a nearby coffee shop represents a huge added value. For the new generation of employees, it is freedom that matters.

Audrey Gagné-Corriveau, Consultant

Will 2023 see the return of the IPO?

What a difference a year makes! In 2020-2021, we witnessed a boom in initial public offerings (IPO) with a strong interest in technology companies and low interest rates. However, 2022 saw a precipitous drop in IPOs as the 2021 new issuers lost value, interest rates rose, and recession fears increased.

Despite ongoing market uncertainty, many expect a gradual yet cautious resumption of IPO activity in the second half of the new year. In Canada, this typically begins with smaller companies that need funds and are flexible on the valuation available in the market, followed by larger names reflecting sector themes and positive investor sentiment. There is a pipeline of companies wanting to go public, and for many, this may mean seeking private equity or debt financing in the near term.

As potential IPO candidates await clarity in market direction or consider other funding options, it’s important that they behave as if they were public companies. This includes implementing best practices in governance, internal reporting structures, and investor relations functions. Also, having a compelling investor story remains imperative. The key questions to address are: How will you grow? What makes you investible?

Craig MacPhail, Group Director, Capital Markets and Larry Markowitz, Senior Director, Financial Communications

Buying locally extends to professional services

Most levels of government now encourage the purchase of local products. In addition to reducing our carbon footprint, this action encourages the local economy, supports high-value jobs, and allows our entrepreneurs to shine.

This "buy local" reflex is now part of Canadian values... but, until now, it has applied mainly to goods. However, the current trend leads us to believe that this will also extend to professional services. This economic nationalism, combined with labour shortages, will lead many organizations to outsource services such as accounting, legal services, communications, digital transformation, and human resources management.

By investing in our local economy, Canadian-based firms will have the tools to become real leaders in their sector. It is a way to stop the exodus of talent and headquarters.

Seeing international firms come to invest in this country is great news in itself and demonstrates the vibrancy of our economy, but ensuring the prosperity of our local professional services firms must also be a societal priority.

Hugo Morissette Senior Director and Leader, Analysis and Public Affairs and Martine Robert, Corporate Communications and Media Relations

Adapting to a new interest rate regime

Since the global financial crisis of 2007-2008, many central banks in developed economies have kept interest rates near zero by engaging in quantitative easing. The easy-money policies were exacerbated by the pandemic as both monetary and fiscal stimulus flooded developed economies such as Canada and the U.S. with inexpensive access to debt. Coming out of the pandemic, as economies recovered and supply chains remained disrupted, inflation rose significantly in developed economies.

To prevent inflation from escalating further, the Federal Reserve and the Bank of Canada engaged in monetary tightening by significantly raising interest rates throughout 2022. While the pace will slow, with the Federal Reserve keen on maintaining high rates into the next year to continue its fight against inflation, companies will need to adjust to this new environment of persistently higher interest rates by being even more efficient with their use of capital. Non-profitable companies will need to transition more quickly to profitable business models rather than purely seek topline growth as sources of financing become increasingly costly. Companies will need to not only craft a great story, but also show investors the path to profitability.

Brian Pearl, Vice-President, Practice Lead, Capital Markets and Richard Chen, Analyst, Capital Markets

Digitization and data insights will modernize reporting processes

Globally, publicly issued companies are facing increasing challenges around the dissemination of financial analysis and corporate governance: how do they adapt to a growing demand for greater transparency, access to information, and reporting customization, all while satisfying the progressive calls-to-action of a continued youthful movement in their investor base? Digitization and data insights.

Companies are realizing that digitizing and modernizing their financial and governance reporting is the way of the future. A key component to becoming best-in-class in this space is to align corporate disclosure documents with brand, ESG strategy, and the overarching vision and evolution of the company. We’re seeing increasing evolution from traditional hard copy and paper distribution to secure online platforms that house large sums of corporate reporting data, from financial performance to ESG deliverables. These digitized reporting formats offer the benefit of custom fields and searchable metrics, satisfying the individual nuances of a diverse investor base, while opening the door for data collection to enable insights-driven decision-making for continuous improvement of reporting practices.

Brian Pearl, Vice-President, Practice Lead, Capital Markets and Bridgette Slater, Senior Consultant