What does it mean to do IR for a sector the market has strong and often complicated opinions about?
Megan Light has worked in energy IR for over 20 years across upstream exploration and production, midstream, LNG, oil field services, and renewable natural gas. She has watched the sector's reputation shift, energy-dedicated funds disappear, and political risk grow.
Today, Megan runs one of the more proactive IR programs in energy. She plans NDRs entirely in-house, targets generalist investors on a multi-year time horizon, and writes disclosures with AI summarization in mind before they ever reach an analyst.
In this episode, Megan explains how to keep a story simple in an industry that isn’t, why chasing generalists means looking outside your sector, and what it takes to build the track record that earns a seat at the table.
Let's get into it.
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Why Energy IR Is Different
Mark Fasken: So Megan, you've been in IR in the energy space for about 20 years now. For IROs who haven't operated in this sector, how would you describe what makes energy IR unique? And how has the sector changed over time in ways that have affected how you do your job?
Megan Light: In energy, there is a certain amount of attention given to it publicly.
Megan Light: It has a certain reputation, and that reputation has really changed over time, as well as the public's views on durability of the industry. So, I always swore I would never move to Houston, I would never work in energy. And that is exactly where I landed. I'm still here 20 years later. Swore I would never do it, and now I don't think I would trade it for anything.
Megan Light: I remember sitting in a finance class in 2004 and a professor saying, "We're gonna reach peak oil in the next five years." And I think that's something that still gets tossed around every so often with macro forecasts. We haven't hit that yet 20 years later.
Megan Light: The world does need a significant amount of energy. I think there's now more of the view globally that energy encompasses way more than just oil and gas, fossil fuels. You know, we have clean energy, we have clean tech, we have renewables, we have RNG.
Megan Light: I've kind of been all over the space from upstream exploration and production to midstream, to LNG, oil field services, and renewable natural gas. So I've seen a lot of different areas of the sector over time. And they of course, have different reputations and different customer sets, different investor sets.
Megan Light: I also think one thing that's interesting about energy, not always the best thing about energy, but over time it has become a smaller part of the S&P 500. And there's a lot fewer energy dedicated funds today than there were before. So finding pools of capital, you have to get a little bit more creative to expand your investor base.
Megan Light: And I think also finally, there's been some regulatory attention on energy. It's a highly regulated industry, so we need to be aware and investors need to be aware of what the regulations are. But there's also now some political risk around it in that the past couple administrations, including the current one, have used energy in various ways to achieve their agendas.
Megan Light: That could involve promoting energy or not promoting energy depending on what the administration is. And that political risk is something that wasn't there probably even 10 years ago, 15 years ago. It's something that we have had to change our approach as IROs into how we tell the story and what the risks we talk about are, and investors have just had to learn and take that into account as well.
Mark Fasken: So there's two things you mentioned there that we'll touch on as we go along here. The term energy becoming broader, and I want to ask you a question about that. But also, the idea that the pool of sort of specialist investors for energy is shrinking and how you deal with that.
Simplifying the Energy Story
Mark Fasken: And so maybe we'll start with this idea that energy is a very broad term. It seems to be getting broader all the time. I mean, to your point, like you've got geothermal, you've got nuclear, you've got batteries, you've got fuel cells, you've got the geopolitical aspects of it.
Mark Fasken: And so this all falls under the quote-unquote energy umbrella. And so with investors who have to cover more ground, how do you think about winning investors' attention? Like how do you think about simplifying the story so that it's something that does appeal to them despite the fact that they might be distracted?
Megan Light: I think you're spot on actually. And just making sure that it is a simple, clear, easy to understand story. We're in an inattention economy right now, and it is increasingly difficult to get people's focus.
Megan Light: So, it's making sure you have news when you want to get their attention, and then making sure that news is very clear, easy to understand.
Megan Light: Repetition helps as well. You know, those very clear setting objectives, updating on the objectives, having those routine slides, the routine touch points in the earnings calls and at conferences.
Megan Light: Really just building the track record, making it tangible, but also just keeping it super simple. And I think one of the unfortunate things is that energy isn't necessarily simple. There's a lot to it.
Megan Light: I work in an industry in the LNG space where we have a four to five-year construction period. We have a certain commercial structure, a certain regulatory structure, and that's just us. Every energy company's gonna be different. So it's being really clear with investors of what are the commonalities in direct peers in other areas of the energy space, and then what are the true differentiators. What is that true investment thesis that makes the company worth spending that time on putting the money to work with?
Finding New Investor Pools
Mark Fasken: And going to the other idea of the investor pool shrinking. I feel like we've heard this from many different IROs, not necessarily that the pool is shrinking, but that many IROs struggle to find that specialist investor that just invests in companies like theirs.
Mark Fasken: I remember we did an episode with Delta and they had a similar comment about, trying to find investors that really care or love airlines can be challenging. you and I had a conversation about chasing or trying to find those sort of generalist investors who may be a fit.
Mark Fasken: How realistic is that in energy? And if it's not realistic, like how do you go about finding sort of new investors in what is a relatively small pool of targets?
Megan Light: In energy, sometimes we call this the elusive generalist investor because it's something that is always talked about. Sometimes even sell-side will get into their notes of, "Oh, we think because of the macro we're going to see more generalist money into energy." And it's something that every few years comes up in the news cycle, but it's something that's really difficult to effectuate in practice.
Megan Light: In my experience, generalists that I have worked with from a targeting standpoint are a minimum two to three-year investment, if not longer, before getting them into the stock.
Megan Light: I think targeting needs to be a proactive game, and it needs to be a very long-term game. That's something we do a lot of at my current company and, you know it's just setting meetings knowing that we may not see this in the shareholder register for three or four years, but that is something we have to do to make that long-term shareholder transformation that we want.
Megan Light: Active targeting, getting investor feedback from generalists to the management team can be important. You know, is there a way that we're approaching them that works or doesn't work? Is our story simple enough? Is it easy to understand? Are we getting out on the road as much as we can? Are we approaching the people that we're the right fit for?
Megan Light: I've read some research recently that I thought was interesting about going beyond, you know, peer targeting, generalist targeting into thinking about financial screening and what we would do for a portfolio, and then finding companies that are similar to us from that standpoint, even though they may have nothing in common with us from a business standpoint, and then targeting their investors. I think that's something we're gonna look into.
Megan Light: One example that I think of for my company. We have 20-year take-or-pay contracts. That's very rare in the energy space, but it's very common in the infrastructure space.
Megan Light: So we do frequently call ourselves energy infrastructure, but we should be out there talking to investors that do other types of infrastructure as well.
Running Self Planned NDRs
Mark Fasken: And not to put you on the spot with a sort of targeting question, but how often are you refreshing that target list?
Mark Fasken: Like, i- is it an annual exercise? Does it change very much?
Megan Light: So we've started actually planning NDRs in-house. I know it's a lot of effort, and I know it's something that not many teams do, and so it may not be the right fit for everybody. But I will say it gives us complete control over accessing like the true targets that we want to meet with.
Megan Light: I know sometimes when you go with a bank or you go with one of your research analysts, you may be limited in who you can see, you know, their priority clients. Plus, I've always had good relationships with the sell side where we can ask for certain key targets that may not be a big relationship for them.
Megan Light: There's always value sharing that is possible, and I think you can work with banks and your analysts to make that happen. But when you're planning it internally, you have a hundred percent control over who you contact, who you reach out to. It is a big resource requirement. It's not something that's gonna be right for everybody. But we will be doing our third self-planned NDR in October of this year.
Megan Light: We have one main target list, but then we're splitting different geographies. So we went into Toronto, we went to Chicago. We're going to be going to London. We're also looking at doing something in Boston later this year.
Megan Light: So, while the overall list may not change, we're using different sections of it periodically. And I think overall, that's probably something that hopefully we can reach the same geographies maybe annually. And so we'll definitely refresh those lists every time that we're looking at going there.
Mark Fasken: And what does the team look like that's setting up those NDRs?
Mark Fasken: Is that just Megan?
Megan Light: And an analyst.
Mark Fasken: Okay.
Megan Light: I have an analyst who has done an amazing job on it. It's actually something he did at a prior firm. And so far it's been really successful. It's turned out way better than I expected.
Mark Fasken: Awesome. And so just to be clear, you're still doing conferences, you're still doing sell-side NDRs, but you're supplementing that all with your own, and it sounds like the reason you're doing that is because, you know, you perhaps were not getting some of the meetings that you would've hoped to get, and so it gives you the opportunity to say, "Look, we need to meet with some of these people," whether existing or prospective, and you can do that on your own.
Megan Light: Yeah, that's exactly right. I will also just say, contextually I think it's important that we currently have eight research analysts, so we are not as heavily covered as some of our peers, and therefore we have, you know, that calendar space where we can go do NDRs on top of the conference circuit.
Megan Light: I think that's something we will have to be more strategic around if we get more coverage over time. You know, if you have 25 coverage analysts, you're probably already picking and choosing which conferences you go to. But we are currently able to do most, if not all, of the conferences we're invited to, plus then we're doing additional NDRs on the side.
Mark Fasken: That's great.
AI and Strategic IR
Mark Fasken: I wanna shift gears a little bit. We had a bit of a conversation about sort of AI, how you're using it, and we like to ask this question to as many of our guests as we possibly can because I think many IROs are still trying to figure out exactly what the use cases are.
Mark Fasken: You said something along the lines of you are writing for AI, not for people. I'd love if you can explain that a little bit more and how it's impacted how you approach communication with the investment community.
Megan Light: Yeah. So I assume at this point, most of the time any material I make is going to be filtered through AI before it gets to an analyst. And then, you know, if the analyst sees something interesting, they may come back and dig in deeper to those materials. But I think given the amount of information that is out there, and over my career I've only seen it increase, and I saw, you know, a huge step change during COVID when everything switched to virtual. I think there was this information increase that never went away, and now that we're seeing AI on top of that, it's a whole extra step of additional information even on top of the post-COVID increase.
Megan Light: So, you know, it's how do you stay on top of everything in your inbox? And if you're a PM that's covering dozens of companies, how do you stay on top of it? How does your analyst stay on top of it? I think AI is going to become a critical part of what they're doing. I think it already is in most cases. So I just assume that I have to get through this game of telephone from my deliverable through the AI to the investment community. And is what's going through that game of telephone what I want to be going through it?
Megan Light: And so that's looking at, you know, working with the LLMs to say, "Analyze this company. What are the big points in its latest disclosure?" And seeing, you know, asking various questions to see what we think the analysts are seeing. When we have close relationships with certain investors, we will ask them directly.
Megan Light: Sometimes you'll get good feedback from that, sometimes you won't. But also going in the models themselves and poking around and saying, "What do we think people are taking away from our deliverables?" And then tweaking them accordingly. So, you know, a few of the things we've done from that, again, to like beat a dead horse, just being clear and concise and easy to understand.
Mark Fasken: So to understand how AI is going to interpret one of your releases, let's just go through the steps of it perhaps.
Mark Fasken: You would write a release. Would you then run it through an AI model and say, "Summarize this for me. Give me the main points." See what comes out of it, and then based on what you get back, you would adjust that disclosure to sort of fine-tune what the primary bullet points would be?
Mark Fasken: Am I understanding that correctly?
Megan Light: That is the ultimate goal. So right now we are only back testing because of security reasons and MNPI. So we don't have an internal model that I can use. We are just back testing once something is out to say do we need to tweak this next quarter, or do we need to tweak this for the next update?
Megan Light: I do hope we get to the point where we can test things ahead of time, but we just don't have the tools to do that while, you know, keeping our data secure right now.
Mark Fasken: I also wanna talk about something that I know you're quite passionate about, which is IR being a true strategic partner to the business.
Mark Fasken: This is a pretty common thread through many episodes of Winning IR. I mean, at the end of the day, I think it's why this podcast exists. How do we help to elevate IROs in any way that we possibly can, such that, you know, people get that seat at the table and become that partner.
Mark Fasken: But I think you would agree that it's easier said than done. A lot of people say that they want the seat at the table, but haven't done the work to earn it. And it is something that you earn over time.
Mark Fasken: I'd love to get your perspective on what strategic IR looks like in practice. What separates an IR team that has a seat at the table, one that's reactive, and just, I think, really what you deem to be some of the most important things that a high-performing IR team should be doing.
Megan Light: That's a great question. So at the end of the day, I believe that execution fixes valuation in almost every case.
Megan Light: So what you need is a good strategy, and you need good execution on that strategy as a company and as an IR team. So, you know, I think sitting in the IR seat, we have access to departments across the company internally, and then also a broad investor and analyst set externally. We're going to see a lot of what is going on, what works, what doesn't work, watching other companies, just learning really from a strategic standpoint, what should we be doing, right?
Megan Light: Now, hopefully as a company, you already have that plan, right, and you already have those things. But, you know, IR can also provide that external view to say, "Company X did something similar, and here's how it was perceived, and if they had done Y and Z, it could've been perceived better or maybe would've gotten a higher valuation."
Megan Light: You know, we get a lot of information, but we also need to know how to use it. So, you know, it's being a good filter for feedback. Not every piece of feedback that I get is worth telling my team. Some is valuable, some is not. And how do I tell what that is? It's time and experience and exposure to a lot of different scenarios.
Megan Light: How do you go from starting day one to getting a seat at the table? I think you just have to build a track record, right? So it's doing your basic IR job and doing it incredibly well, and becoming a trusted source of information, becoming a trusted source for feedback over time from investors and from research you're seeing on other companies.
Megan Light: It's understanding the business really, really deeply and in detail. It's asking good questions, learning what you don't know, and learning what's missing. I think one of the scariest things, at least to me, in IR is that I don't know what I don't know, and that's the thing that keeps me up at night more than anything else.
Megan Light: But if you can ask people good questions and kind of keep digging and, and really put in that time and effort, I think you can get to a point where you at least understand a little bit more of what you don't know.
Megan Light: I also think, you know, thinking strategically, right? When we're working on updating messaging, it's not just we want to say a certain thing, it's we want to say a certain thing for a certain reason because it's going to lead to a certain view, or it's going to make people think about a certain thing a certain way.
Megan Light: We're trying to play that out several steps ahead. Is there something we're saying today that could be a pitfall nine months from now, right? We're trying to figure out ahead of time how can we steer the corporate message over time to be consistent and to set ourselves up to achieve our goals, and to get the credit from the market for achieving those goals.
Megan Light: So, you know, I think it's really just putting in the work, building the relationships, and then taking the long-term view.
Mark Fasken: Well, Megan, that's all the questions that I have for you today. We really appreciate your time. Thank you very much.
Megan Light: Yeah. Thank you.
Megan Light: Appreciate it.
