Transcript Slide 1

Global and U.S. Trends in
Information Disclosure, Annual
Reports and Best Practices
Mary Beth Kissane
Friday, November 19, 2010
[email protected]
S:\Staff\MBK\RTS Conference Presentation
Moscow, Balchug Hotel
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RTS Annual Workshop with
Issuers
– A Bit of History of Investor Relations in the U.S.
– What Attracts Investors to Annual Reports
– Global Trends in Information Disclosure
– U.S. Disclosure Best Practices
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A Bit of History of Investor
Relations in the U.S.
– 1929 Market Crash/Great depression
– Securities Act of 1933
– Securities Exchange Act of 1934
– Formation of the SEC
• Watchdog for the retail investor
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What Attracts Investors to
Annual Reports
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(National Investor Relations Institute
2008 Annual Report Survey)
Other
Competitive lands.
Future quant. objectives
New product plans
Mrkt segment info
R&D
brands and addresses
List of directors and officers
Subsidiaries,
Auditor opinion letter
CSR info
MD&A
5 yrs financials
10 yrs financials
CEO letter
What Attracts Investors to
Annual Reports
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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Annual Report Format Trends
(National Investor Relations Institute
2008 Annual Report Survey)
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Page Count Trends
(National Investor Relations Institute
2008 Annual Report Survey)
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Unit Cost Trends
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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(National Investor Relations Institute
2008 Annual Report Survey)
pages on your site
Links to other
Other, please specify
Animation
financial data
graphics
Down-load
Splash/Flash
Index (searchable)
Slide-show presentations
Photographs
Illustrations
Foreign language translations
Drill down/through into data
Pop-up disclaimer
Video
Audio Clips
Java Scripts
Interactive HTML
What Attracts Investors to
Annual Reports
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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AR Narrative Responsibility
(National Investor Relations Institute
2008 Annual Report Survey)
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MD&A Involvement Trends
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
Public
Relations
IT/MIS
Finance/
Treasury
Marketing Graphics/
Design
(internal)
(National Investor Relations Institute
2008 Annual Report Survey)
Other
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AR Challenges
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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What Attracts Investors to
Annual Reports
(National Investor Relations Institute
2008 Annual Report Survey)
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Global Trends in Information
Disclosure
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Global Trends in Information
Disclosure
– Greater transparency
– Greater use of technology
– Need to watch for process, avoid glitches (Disney
problem last week)
– Greater appreciation of reputational risk
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Global Trends in Information
Disclosure
– Companies are LISTENING. Investment Community
feedback the most important measure of IR
effectiveness according to 65% of companies in all
regions but North America. North American firms
value meeting quality (72%) and sound use of senior
management time (69%)
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– IR Priorities:
• Ensuring effective disclosure (63%)
• Coordinating the public message (51%)
• Ensuring management visibility (36%)
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– Investor communications spread between
• Current Owners (33%)
• Target Investors (25%)
• The Sell-side (29%)
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– Average number of one-on-one meetings:
• IRO 147
• CFO 72
• CEO 46
– IRO included in C-Suite meetings 92% of the time
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– U.S. still most frequent destination for non-deal road
shows (85%). Followed by:
– UK (75%)
– Continental Europe (64%)
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– Continued growth in research coverage
– More meetings with hedge funds
– More meetings with SWFs (U.S. firms – not as much)
(BNY Mellon: Global trends in Investor Relations – A Survey Analysis of IR
Practices Worldwide – 6th edition)
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Global Trends in Information
Disclosure
– Technology
– Feedback/dialogue
– Web disclosure
– Proxy access
– Corporate reputation
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Global Trends in Information
Disclosure
Reuters, October 5, 2010 article
Exclusive: Symantec to restore live meeting after criticism
By Ross Kuber Tue Oct 5, 2010
Symantec Corp said it plans to hold part of its 2011
annual shareholders meeting in a live setting after
criticism that its online-only 2010 meeting shielded
executives from tough questions.
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U.S. Disclosure Best Practices
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U.S. Disclosure Best Practices
– IR has a seat at the table and board access
• MDA/CDA/proxy issues
– IR is a member of the disclosure committee
– Partners with PR/CS and GC
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U.S. Disclosure Best Practices
– NIRI standards of practice and ethics committee
– Invite dialogue
– IRO is the Regulation FD compliance officer
– Regular Regulation FD training
– But Regulation FD is not a block to
communications
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U.S. Disclosure Best Practices
– Ultimately, the best IROs are an important risk
mitigation tool. They set and manage appropriate
investor expectations. The best IROs speak truth to
power when appropriate. They don’t get so tangled in
compliance that they forget to anticipate and address
investor and public reaction to disclosures.
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financial and corporate public relations firms. Founded in 1998 and with offices in
New York and Hong Kong, Walek specializes in public relations and investor
relations in capital markets, traditional and alternative asset management,
professional and financial services, information and financial technology, and public
companies in all sectors. From building visibility and brand to financial PR, financial
transactions, product and service launches, and managing crises, Walek delivers
results that help clients build business. www.walek.com
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RTS Annual Workshop with
Issuers
Mary Beth Kissane
Friday, November 19, 2010
[email protected]
Moscow, Balchug Hotel
40