Jeff Morgan and the NIRI team demonstrated great leadership in regard to the ongoing discussion surrounding the SEC’s 2008 web disclosure interpretation: NIRI asked the IRO for their opinion.
To me, the 2008 interpretation was watershed for a single factor. The SEC acknowledged that a company’s website’s value to shareholders as a news vessel is equal to Yahoo’s (for example) value. The SEC's new opinion on disclosure is that the web is flat.
Remember, RegFD was penned as law October 2000. Web-years are like dog-years. The new interpretation reflects that the web grew up since RegFD’s inauguration. For example, earnings webcast are de rigor now, in 2000 they were magical. RegFD’s 2000 goal was not to rank different disclosure points – it was to stop selective disclosure to favored analysts.
So where does that leave us with the 2008 interpretation discussion? Exactly where the NIRI survey’s said we are.
Using a commerical newswire is no longer a compliance decision for a corporation, it’s a business decision or better yet, it’s a transparency decision. Perhaps even a marketing decision.
If a company’s goal is just to be web compliant, here are some handy-money-saving-tips for investor relations.
1.) Take down your IR website. The only pages required by the SEC are your Section 16 files and recently, your XBRL raw files - no rendered view needed. The rest is just transparency flotsam.
2.) Post your earnings “somewhere” on your corporate site. Ask your web developer to put it in his work queue – no rush. He’ll get to it right after he posts the CEO’s new photo and bio. And the new lead generation form for sales. Oh wait. He's on vacation this week.
3.) No more newswire feeds to the Street. Analysts and portfolio managers spend too much time in their Bloomberg, ThomsonOne, etc. terminals anyway. It will good for them to stretch their legs and walk over to the fax machine. They will thank you.
4.) Stop holding earnings calls! Simply and simultaneously tell nothing to no one.
5.) Obviously, nix the annual shareholder meeting webcast! Your board is dull anyway.
6.) Just file your Ks and Qs with the SEC. Prospective and current investors should show some initiative and just go to the SEC.gov site for themselves anyway.
7.) No more road shows or investor conferences. Make those lazy analyst bastards come to you.
8.) And CERTAINLY – don’t fuss with Retail Investors at all. They are a scary bunch, right?
Transparency outreach is akin to marketing. It drives investors (customers) into the investment (sales) funnel, builds their confidence about the company and hopefully compels them to take a position (buy the product). Compliance will not do that.
Caveat. I build and market IR transparency solutions and I have a zillion friends, across many companies who do the same. And - (spoiler alert) - we make money from these services. It’s an individual corporation’s business decision whether to value (purchase) these services.
Most transparency solutions, like marketing solutions, have costs. A company does not have to “advertise.” Heck, I love it when my marketing budget is cut. Gives me tons of free time to blog.