CIRI Then & Now – The Development of Investor Relations in Canada
During the mid-to-late 1970s, CIRI was but a gleam in the eye of a small group of Canadian investor relations (IR) practitioners who had joined the Washington-based National Investor Relations Institute (NIRI) to help their companies respond to increasing demands from the investment community by learning more about IR.
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These corporate communicators met with increasing frequency, in Toronto and Montreal, to share ideas. Among participants were representatives from Bell Canada, Northern Telecom and Alcan. They soon realized the importance of formalizing their efforts, and in 1979 established the first non-U.S. NIRI chapter, NIRI Canada located in Toronto.
NIRI, now based in Virginia, had been formed in 1969 and by 1979 had about 950 members and 20 chapters and was well on its way to developing an impressive educational program. Early on, NIRI was the driver and role model for developing the IR profession in Canada. But as NIRI Canada gained its footing, with a growing membership and its own evolving educational program tailored to address Canada’s unique securities market environment, that drive and leadership shifted to Canada.
Other chapters were formed in Alberta (Calgary) in 1987, British Columbia (Vancouver) in 1989, and Quebec (Montreal) in 1991. Formation of the B.C. Chapter proved premature, and it was inactive during much of the 1990s but reconstituted in 2001 thanks to efforts of seasoned local IROs, supported by CIRI.
The original NIRI Canada chapter was renamed NIRI Eastern Canada when the chapter in Calgary was formed and initially named NIRI Western Canada. A key milestone was the establishment in 1990 of an umbrella organization for all Canadian chapters, to be called NIRI Canada. The new organization had a national board of IR professionals and hired a full-time executive director, with plans over time to build NIRI Canada into a leading IR organization internationally.
In the next few years it became clear that NIRI Canada needed to be a stand-alone organization to better serve the growing needs of its members, and gain stature in the international investor relations community. This required restructuring of the affiliate relationship with NIRI, the achievement of sustainable funding, and a new name to provide a distinctive Canadian brand. In 1992, the NIRI Canada board proposed and the membership approved a new charter, and a rebranding as CIRI. In 1997, CIRI was officially incorporated as a not-for-profit organization.
With a sound structure, leadership and funding in place, CIRI was positioned to become a leading IR organization.
Founders & Early Ambitions
CIRI is indebted to the pioneers who had the vision to establish the NIRI Canada chapter, and to lead in establishing other chapters and ultimately launch a thriving, national organization. The high standards and ambitious objectives set by the early pioneers were critical to the organization’s successful professional evolution. Those who served as president of the NIRI Canada chapter or the Canadian umbrella organization in the years leading up to the birth of CIRI in 1992 and its incorporation in 1997, and as chairman in the years since, are recognized below.
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CIRI Board Chairs*
1979-1981 Frances Carmichael, NIRI Canada**
1981-1983 Dick Wertheim, NIRI Canada**
1983-1985 Belle Mulligan, NIRI Canada**
1985-1987 Lorne French, NIRI Canada**
1987-1989 Frances Carmichael, NIRI Canada**
1989-1991 Mary Brebner, NIRI Canada***
1991-1992 Gary Lloyd, NIRI Canada***
1992-1994 David Mills
1994-1996 Tracy Lutz
1996-1998 Bill Rowe
1998-2000 Peter McBride
2000-2002 Wilma Jacobs
2002-2004 John Rogers
2004-2005 Bob Tait
2005-2007 Tom Merinsky
2007-2009 Sharon Mathers
2009-2011 David Carey
2011- 2012 Colleen Vancha
2012 - George Kesteven
*Called President until 1997
**Chapter of US-based NIRI
***Canadian umbrella organization
As early as 1982, NIRI Canada had ambitious national plans and sought a solid financial base. According to a letter to the then president of NIRI, James Mabry, from Dick Wertheim, then president of NIRI Canada and a director on NIRI’s Board:
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“We believe we have the potential to develop a major IR organization in Canada, comprising discreet chapters in Toronto, Montreal, possibly the Maritimes, Alberta (perhaps a chapter in each of Calgary and Edmonton) and Vancouver…As great as the opportunities are, we face some formidable hurdles in fulfilling our potential…NIRI Canada is unique among the NIRI chapters in that we represent another country. The players, customs, structure and often the methods of operations of the investment community differ in myriad ways from the U.S. investment community. The securities laws, the regulatory bodies, and tax structure are distinctly different from those in the U.S….While there is much information in NIRI’s publications…which is of generic interest, and other material that is of interest to interlisted companies, NIRI performs none of these function on the Canadian scene. It has been argued, therefore, that a NIRI Canada member does not receive membership services of comparable value to those received by a U.S. member.”
The letter goes on to say that prospective NIRI Canada members did not perceive they received sufficient benefit from NIRI to justify the current membership fee (of which about 83% went to NIRI, and 17% to NIRI Canada) and that the split should be closer to 50%/50% or 57%/43% in NIRI Canada’s favour to provide funds for the establishment of an office and proactively develop a Canadian education program. The letter outlined two proposals: (1) to continue as a chapter of NIRI, with the addition of a new class of Canadian members, who would not be required to join NIRI, or (2) to return the NIRI Canada charter to NIRI and effectively dissolve the Canadian chapter of NIRI, forming a new organization that would operate autonomously. Interlisted companies would join NIRI at their discretion. The first alternative was presented as the preferred one, and the result in 1990-1992 was a hybrid of the two.
Milestones During the 1980s
Throughout the 1980s, NIRI Canada achieved a number of milestones:
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- Formed chapters in Alberta (initially called ‘NIRI Western Canada’; then ‘CIRI Alberta’ when CIRI was established), and in B.C. (a premature initiative with the chapter inactive for several years before being reconstituted in 2001);
- Chapters developed speaker luncheon programs
- NIRI Canada co-sponsored the first annual IR conference with the TSX in the fall of 1985, a half-day event in Toronto, followed by another in 1986. There wasn’t sufficient registration in 1987, and the fall timing was considered a factor. The annual conference was held again in the spring of 1988 (titled: “Share Value – Beyond the Bottom Line”), and consecutively thereafter, expanding to a two-day conference in 1991. The selection of locations outside Toronto began in 1997, when the conference was held at the Fairmont Banff Springs Hotel.
- Introduced the ‘Award for Corporate Excellence in the IR Field’ in 1989, with Arden Haynes, then CEO of Imperial Oil, the first winner. In subsequent years, the award was called the ‘Award of Excellence in Investor Relations’, to honour investor relations officers (IROs) or consultants who have ‘made an outstanding contribution to the investor relations profession and to CIRI.' (See below for Award of Excellence winners.)
- Launched NIRI/Canada News, a publication produced on an ad hoc basis. In June 1989, the more robust bimonthly ‘Newsline’ was launched in response to strong demand for ‘information relevant to the practice of IR in Canada’, as revealed in a member survey. Newsline established an editorial board, and introduced advertising to help cover costs.
- All the while, the board was planning for an independent organization.
CIRI Award for Excellence in Investor Relations Winners
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Arden Haynes (1989)
Frances Carmichael (1990)
Isabel Mulligan (1991)
Richard Wertheim (1992)
Lorne French (1993)
Gary Lloyd (1994)
Mary Brebner (1995)
Jo Mira Clodman (1996)
Tracy Lutz (1997)
David Mills (1998)
Bill Rowe (1999)
Ron Blunn (2000)
Peter McBride (2001)
Betty-Ann Heggie (2002)
Jane Watson (2003)
Wilma Jacobs (2004)
John Rogers (2005)
John Wheeler (2006)
Nancy Woo (2007)
Tom Merinsky (2008)
Angela Joyce (2009)
Sharon Mathers (2010)
Elaine Wyatt (2011)
NIRI Canada Takes Flight
In June 1990, under the leadership of then president Mary Brebner, NIRI Canada was formed as an advisory and support umbrella organization for the then existing three chapters.
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The lead-up to this milestone involved a firm defence of the $100 fee rebate received by NIRI Canada from NIRI. NIRI had wanted to reduce the rebate to $50, in line with other international members. It required NIRI Canada to prepare a five-year plan to defend its funding requirements. Belle Mulligan (then NIRI Canada director on NIRI’s board), and Mary Brebner made two presentations to the NIRI board in Washington, making the case that Canada needed the full rebate because (i) Canada had unique educational and advocacy requirements with its differing securities, stock exchange, accounting, tax and legal regulations; and (ii) needed working capital for seminars and conferences across Canada, publication of NIRI Canada Newsline, and administrative and research support for these activities through the planned hiring of one full-time or two part-time individuals. Up to this point, NIRI Canada was entirely a volunteer organization, and volunteers while enthusiastic and dedicated were getting maxed out. To move to the next level, build credibility and expand its membership, NIRI Canada needed more, not less funding. To their credit, Belle and Mary won the day, and the $100 rebate was maintained.
A full-time executive director, Joanne (Joey) Brown was hired to be editor of Newsline, develop conferences in various cities across Canada, co-ordinate communications efforts between chapters, assist chapters in their membership drives and assist in the creation of new chapters. These activities were to be funded by the NIRI Canada fee, revenues from a planned corporate sponsorship fundraising campaign, seminars and annual conference, plus surplus chapter funds. NIRI Canada continued to have a director on the NIRI Board, a role filled at that time by Belle Mulligan.
With Joey’s appointment, NIRI Canada established an office (until 1996 at Joey’s home), and had a full-time manager to drive the development of CIRI. Joey added staff as demands warranted and the budget allowed. She and her team worked closely with the national and chapter boards and effectively tapped the resources of member volunteers committed to developing the profession as well as their own capabilities. An enthusiastic IR network was growing, helping to drive CIRI membership and program development.
The bylaws for the new organization were drafted by Betty Moffat, treasurer of the NIRI Eastern Canada board, approved by that board in consultation with other chapter boards, and ratified June 6, 1990. Officers of the first NIRI Canada board were Mary Brebner (president), Pat Trottier (president of the Alberta chapter) , Gary Lloyd (funding), Pat Mahoney (program), David Mills (treasurer), Paul LaFontaine (membership, and president of the B.C. chapter), Eric Lavarak (conference chairperson), Frances Carmichael (NIRI Canada Newsline chair), and Joey Brown, executive director. By November 1990, Jo Mira Clodman had become Newsline chair, with Frances Carmichael now focusing on advertising, and Jo Mira has continued as editor to this day. The Board added regional directors – Joan Philip in Ottawa and Roy Firth in Quebec.
To raise corporate sponsorship funds, Gary Lloyd headed a committee that included Lorne French, Frances Carmichael, Mary Brebner, Joan Philip, Pat Trottier and Paul LaFontaine. Their targets were $40,000 in 1990, and $60,000 to $75,000 in total. They focused on corporations with NIRI Canada members, seeking contributions of $5,000 each toward IR educational programs. The fundraising was successful, and donors were recognized in Newsline as ‘Charter Sponsors’, supporting excellence in IR. Those initial sustaining sponsors included Alcan, Barrick Gold (American Barrick), BCE, Canadian Imperial Bank of Commerce, CCL Industries, Imasco, Imperial Oil, Noranda Group, Royal Bank of Canada, and TransCanada PipeLines.
CIRI is Born
Early in 1992, a special task force was formed by the Board to further restructure the relationship between NIRI and NIRI Canada. Chaired by Belle Mulligan, the task force drafted a proposal that set out ways to establish an independent and distinct investor relations organization in Canada while continuing to benefit from NIRI’s valuable resources through an affiliate arrangement. Lorne French, who succeeded Belle Mulligan on the NIRI board, played a pivotal role in negotiating the new structure with NIRI. Other members of the task force were Mary Brebner, Frances Carmichael, Dick Wertheim and Joey Brown.
Financial restructuring was key to the proposal. The task force recommended that a greater portion of member fees be retained in Canada with the shift phased in over two years, but that there be no change in total fees. The portion directed to individual CIRI/chapter fees increased to three quarters from one quarter previously, with the balance directed to NIRI. It also recommended that the Canadian organization assume responsibility for collecting fees and approving new members effective November 1, 1992.
The NIRI Canada board approved the proposed new structure in March 1992. NIRI members in Canada were asked to vote by April 24, 1992, and formation of the new organization, to be named CIRI, was officially ratified soon after. CIRI membership at the time totaled 160.
In a letter seeking support of the NIRI Canada membership, signed by then president Gary Lloyd, the advantages of establishing a separate Canadian organization were provided:
- to assure international recognition for Canadian investor relations efforts which will become increasingly important in the global investment markets; and
- to provide expanded programs and member services that are closely suited to the majority of Canadian members and are designed to address Canadian needs, issues and regulatory requirements.
Retaining an affiliation with NIRI would ensure that all members, especially those with interlisted companies, continue to benefit from NIRI’s valuable resources. CIRI members would continue to receive a subscription of Update, the membership directory and reduced rates at U.S. seminars and conferences. CIRI and NIRI would have representation on each others’ boards of directors to ensure on-going communications and opportunities for joint programs.
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From NIRI’s viewpoint, the Canadian request for the restructuring was a natural progression of the growing affiliate organization. Financially, the reduced revenue flow to NIRI was offset by reduced costs for such things as fee collection and membership data maintenance. The relationship has remained constructive and mutually beneficial.
In 1997, CIRI was incorporated as a not-for-profit organization. At that time, Joey Brown became President and CEO and a voting director. The IR professional who led the board became the chair, rather than president.
CIRI’s Evolution Through 2010
With CIRI’s structure and financing in place, David Mills, CIRI president in 1993, invited leading IROs to a meeting to “help formulate a focus and direction for the future of CIRI”. One goal was “to bring a Mission Statement to the board to put into place a dynamic set of programs and services that will keep CIRI strong and growing into the future.”
CIRI at the time defined itself as "a professional, non-profit organization of executives responsible for communications between public corporations, investors and financial communities. Effective investor relations can translate into fully-valued securities and lower cost of capital.”
At that time, a number of issues were discussed that remain subjects of debate to this day. How could CIRI best support chapters as primary drivers of membership growth? How could CIRI best facilitate and coordinate programming at the chapter and national levels? How could programming be balanced to meet the needs of senior IROs while continuing to provide IR fundamentals? It was decided that CIRI should develop its own ‘body of knowledge’ publications – similar to NIRI’s Standards & Guidance for Disclosure – and in time undertake issues advocacy.
There was a strong sense of purpose, and a high level of enthusiasm and urgency to establish a robust platform of programming and services as quickly as possible. The CIRI board, CIRI staff, local boards, committee members and other member volunteers all had important roles to play. The national and local boards were made up of senior IROs from across the country, developing a valuable professional network. Joey’s collaborative leadership accelerated CIRI’s early progress. In 1995, the head office moved into a more spacious, functional venue in Mississauga, and full-time staff doubled to two with the hire of Mary Blair as administrative assistant, later membership head.
This was the period of many ‘firsts’ – the first:
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- seminar focused on financial analysis, in 1992;
- IR Fundamentals seminar in 1996 (later called Essentials of Investor Relations conference);
- five-day Strategic Investor Relations Management Executive Program at the University of Western Ontario’s Richard Ivey School of Business in 1997; a successful program that was provided annually through 2004;
- compensation and responsibilities survey in 1997;
- interactive website with password protected access to members only sections in 1997;
- Formation of an ‘issues committee’ in 1995, first chaired by David Mills, to keep members abreast of developing IR-related securities regulations through ‘Bulletins’ and provide comment on proposed regulations through advocacy submissions;
- edition of Standards & Guidance for Disclosure in 1998, (drafted by lawyer Margaret Cohen, who had provided the regular legal column for Newsline), the Canadian version of the NIRI disclosure document with the same name;
- CIRI annual meeting as an incorporated not-for-profit entity in 1998;
- hiring of a director of professional development (Syliva Biggs) in 1998;
- strategic planning session using an outside facilitator, in 1998. That session articulated CIRI’s vision. “CIRI will be the professional association recognized by corporate executives, regulatory bodies, the investment community and the business media as the Canadian authority in investor relations.” It also articulated its mission and goals, and analyzed the business environment;
- hosting of the annual International IR Federation (IIRF) conference in Toronto in 1998 (often attended by a CIRI member representative when held outside Canada);
- IR advocacy submission, on the subject of reaching beneficial shareholders, in 1999;
- publication of a Model Disclosure Policy (MDP), developed by a committee headed by Tracy Lutz. The first version of CIRI’s policy was attached to the second edition of the Standards & Guidance for Disclosure produced in 2003. A third edition of the Standards & Guidance and second version of the MDP was produced in 2006, with Jane Watson as project leader. The fourth edition with an updated MDP was published in 2011, with Tracy Lutz as project leader;
- publication of the Guide to Developing an Investor Relations Program, in 2001, written by Tracy Lutz, who was assisted by a committee of CIRI members;
- introduction in November 2008 of IR Focus, a practical how-to two-page guide that complements Newsline;
- introduction in September 2009 of wIRed, a weekly e-newsletter providing relevant IR news/articles, information on CIRI National and chapter events, and recent research or studies to help members develop, adapt and implement their investor relations strategies; and
- initiation of the ‘Belle Mulligan Award for Leadership in IR’ presented for the first time at CIRI’s annual conference in June 2010, in honour of Belle who died in November 2009 following a long and courageous battle with cancer. The first recipient was Alison Thompson, who developed the Geothermal Code for Public Reporting and led the industry in applying it.
CIRI Increases in Stature
All the while, CIRI and the IR profession were increasing in stature. There were a number of disclosure and governance-related regulatory developments on both sides of the border through the early 2000s that affected issuers and raised the bar for IROs. CIRI’s response as educator and, in some cases, in an advocacy role, helped build its public profile and its membership.
These developments included:
- the U.S. Securities and Exchange Commission’s (SEC) ‘Regulation Fair Disclosure’ in 2000, which targeted selective disclosure, followed by the Canadian Securities Administrators (CSA) National Policy 51-201 Disclosure Standards which addressed concerns about selective disclosure and provided the framework for a disclosure policy for issuers;
- the accounting misrepresentations and frauds involving Enron, Worldcom and other issuers at the turn of the century leading to the Sarbanes-Oxley Act (SOX) in 2002 in the U.S, and shareholder protection and continuous disclosure regulations in Canada; and
- Ontario’s introduction in 2006, followed by other provinces, of a statutory civil liability regime for continuous disclosures. Ontario Bill 198 targeted misrepresentative and/or untimely disclosures with the intent of improving the standard of public disclosure while avoiding the litigious environment in the US.
CIRI provided informative Bulletins, Backgrounders and Briefs for members, and integrated the evolving rules and guidelines into updated Standards & Guidance for Disclosure and the Model Disclosure Policy. These developments elevated the importance of good IR in helping to build value and reduce risk liability.
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CIRI membership numbers also were influenced over time by economic factors, and the number of initial public offerings – offset by merger and acquisition activity – in any given year. Memberships are held by individuals, rather than issuers, underlining the professional rather than corporate affiliation, and this has buffered the impact of the changing corporate landscape.
Joey Brown oversaw CIRI’s successful development into a strong, independent Canadian IR organization from 1990 through mid-2003, when she retired as president and CEO. She was followed by interim president Wilma Jacobs, previously chair of CIRI (2003-2004), and then by three presidents (Roxanna Benoit 2004-2005, Bob Tait, 2005-2007, and Ian Bacque 2007-2008) before the appointment of Tom Enright in November 2008. Previously president and CEO of CNW Group, and a recipient of IR Magazine’s award for Lifetime Achievement in IR in 2008, Tom brought a commitment to furthering the IR profession and the executive skills to achieve CIRI’s vision and goals.
As the IR function has gained importance and recognition, CIRI has networked and partnered with a growing number of regulatory and non-regulatory organizations, developing important symbiotic relationships.
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Its first and several subsequent annual conferences were co-sponsored with the TSX, and a close relationship continues. CIRI also has a close working relationship with the Ontario Securities Commission, with a designated representative on the OSC’s Continuous Disclosure Advisory Committee. CIRI regularly provides comment through submissions on proposed regulations and guidelines of the Canadian Securities Administrators (CSA) and OSC that require an IR perspective.
CIRI has worked jointly on IR-related projects with the Canadian Institute of Chartered Accountants (CICA), Institute of Corporate Directors (ICD) and Chartered Financial Analysts (CFA) group. CIRI members regularly provide judging from an IR perspective for the CICA annual report and sustainability report awards. CIRI provided comment on the CICA’s MD&A – Guidelines for Preparation and Disclosure, and other documents. CIRI co-sponsored with the ICD a survey on board-shareholder relations, and participated in a study by the CFA and NIRI that provided guidelines for issuer/research-analyst relationships.
In 1997, CIRI partnered with the Richard Ivey School of Business at the University of Western Ontario, to launch an annual five-day ‘Strategic Management of Investor Relations’ program focused on IR as a critical component of the corporate strategic and tactical planning process. Course topics included: corporate strategy and investor relations; IR and the marketing process; capital markets: value determination, liquidity and IR; issues in ethics and corporate governance; financial reporting process; investment valuation and IR; media relations IR; corporate disclosure strategy; and IR strategy development. This program benefited more than 200 IROs through to its final session in 2004.
The launch in 1993 by UK-based Cross Border Publishing of IR Magazine, an IR-dedicated monthly publication featuring global coverage, and ancillary services, brought significant value to the Canadian IR community, and to CIRI. IR Magazine hosted its first gala IR awards dinner in Canada in 2000, where it recognized top IROs and a top CEO selected by a professional survey of the investment communities in Canada and the U.S. and also recognized an individual for ‘lifetime achievement in IR’. The dinner and awards are sponsored by leading players in, and suppliers to, the Canadian IR industry.
Early on, NIRI Canada worked closely with the Canadian Society of Corporate Secretaries (CSCS), mainly regarding the issue of reaching beneficial shareholders. Common interests continue, notably with the increased regulatory emphasis on corporate governance.
Since the beginning, CIRI has depended on its many sponsors and exhibitors to support the organization and to provide meaningful, reliable products and services to the IR function. These sponsors and exhibitors have enhanced CIRI’s IR program through their generous support.
The National Strategic Partner (NSP) sponsorship program was launched in the early 2000s with CNW Group Ltd. (then Canada Newswire Ld.) and Marketwire (then CCN Matthews), the first NSPs. TMX/Equicom and Business Wire joined the rank of NSP in 2010 and 2011 respectively.
By 2010, CIRI had established itself as a professional, well respected, national organization for the IR profession which it now defines as: “the strategic management responsibility that integrates the disciplines of finance, communications and marketing to achieve an effective two-way flow of information between a public company and the investment community, in order to enable fair and efficient capital markets.”
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In the Spring of 2010, CIRI moved its offices to downtown Toronto from Mississauga, to be more accessible to members and other stakeholders.
There are myriad evolving IR-related issues about which members will look to CIRI to provide information, guidance and advocacy in the years to come. Issues on the immediate horizon include the impact of international financial accounting standards that will be required in Canada in 2011; evolving standards of disclosure for environmental (including climate change), social and governance (ESG) matters; and best practices in the growing use of social media.
To help fund CIRI’s ambitious educational and advocacy program, the president and board in 2010 spearheaded a new corporate donation program which by the fall of 2010 had raised $130,000. from 14 issuers whose IROs are CIRI members. The largest donators, in the ‘champion level’ category of $50,000+, are Arc Energy Trust, Teck Resources and Suncor Energy.
The next major initiative, planned for September 2011, is to launch an IR certification program in partnership with the Richard Ivey School of Business. In June 2010, CIRI announced that “recognizing there is a need for formal education in the field of investor relations, CIRI is developing a program that will cover all relevant areas of this multi-disciplinary role including capital markets, corporate governance, securities law, finance and communications.” The 10-month program will be delivered through a combination of online and face-to-face classes. Based on course work, CIRI will offer an exam to obtain a professional designation in IR.
The IR function is becoming increasingly demanding and complex, as capital markets become more competitive and global, disclosure requirements tighten and penalties for poor disclosure escalate, and communication channels multiply and change. The evolving needs of its members will continue to drive CIRI’s agenda.