THOMSON FINANCIAL
Best Practices in IR Web sites
NIRI St. Louis
Kelly McPartland
Director, Web Hosting Services
September 29, 2006
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Agenda
• Recent Trends
• IR Web Site is Mission Critical
• Best Practices
• Q&A
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Recent Trends: Multiple Responsibilities
2005 NIRI Survey - how IR spends its time:
• Shareholder relations
• Financial analysis
• Corporate communications
• Financial media relations
• Corporate governance
• Strategic planning
• Public relations
• Employee relations
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Recent Trends: Decline in Sell-side Coverage
Top 5 means of receiving financial information:
E-mail alerts
77%
Web site
59%
Conference calls
57%
Webcasts
45%
Financial database
38%
(source: Thomson Financial survey of institutional investors)
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Recent Trends: Evolving Regulatory
Environment
•
•
•
•
•
Executive compensation
E-proxy
XBRL
Accelerated filings
Quarterly reporting condensed
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Recent Trends: Evolving Regulatory
Environment
• Quarterly reporting condensed:
– Peak earnings release week: week 5 (28%) followed by
week 7 (20%)
– Most popular day of the week to release earnings:
Thursday (29%) followed by Wednesday (23%) and
Tuesday (22%)
– Most popular webcast times: 11AM (16%), 10AM (15%)
and 5PM (12%)
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Recent Trends: More Demanding Investors
• Information: more, better
and faster
• Real-time = increased
expectations
• Increased reliance on the
Web
• Audiences expect greater
access
• Increased scrutiny and
expectations
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Recent Trends: Technology on the Rise
• Web 2.0 = interactivity
• Blogs
• RSS
• Podcasting
• Wikis
• Video
• XBRL
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IR Web Site is Mission Critical Application:
Corporate Web Site Usage
Less often than
monthly: 12%
Daily or more
often: 29%
Monthly: 17%
Weekly: 16%
A couple of
times a week:
30%
Source: Thomson Financial 2006 Survey
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IR Web Site is Mission Critical Application:
Corporate Web Site Usage
•
47% of investment professionals find IR Web sites
very or extremely important (Source: AIMR survey)
•
90% of institutional investors find a company’s Web
site impacts their perception of that company
(Source: Thomson Financial)
•
32% of portfolio managers said that corporate Web
sites are more important since the passing of SOX
(Source: Rivel Research)
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Best Practices: Comprehensive Content
Source: 2006 Thomson
Financial survey
Would like
to Access?
MOST Important to
Access?
Corporate governance info
96%
9%
Fixed income data
95%
5%
Stock quote & charts
94%
6%
Video
93%
9%
Company overview
89%
16%
Earnings Estimates
89%
14%
Financials calendar
88%
16%
SEC filings
87%
21%
Conference call transcripts
87%
22%
Contact information
85%
20%
Detailed financial data
85%
29%
Webcasts
84%
25%
Investor presentations
83%
43%
Press release archive
83%
27%
Annual & quarterly reports
81%
34%
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Best Practices: Be Compliant
√ News Releases/8K
– Timely Web site posting
√ Regulatory Filings
– Post report free of charge on site in
a timely manner
√ Section 16 (insider filings)
– Must be posted to the Web site no
later than next day
√ 10Ks/Qs
– Companies have to disclose their
Web site address within, or state
why not
√ Code of Ethics
─ Either in annual report or on Web
site
√ Reg G
─ GAAP/Non-GAAP reconciliation
√ Executive Certifications
─ CEOs & CFOs must certify financial
statements, and should post to site
√ Section 301 (related)
– Confidential, anonymous submission
of complaint by employees regarding
accounting or auditing matters
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Best Practices: Be Transparent
“A company can disclose a great deal of information
and be in compliance with the rules and regulations.
But, until that information is presented in a clear and
understandable manner, it does not adhere to the
spirit of good communication--it is not transparent.”
- Lou Thompson, former NIRI President & CEO
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Best Practices: Intangible Assets
• Account for 35% institutional investor stock decision
factors
– Measures That Matter, Ernst & Young
• 35% of professional investors' decisions are driven
by non-financial data or by information about
intangibles
– Cap Gemini, Ernst and Young
• Comprise at least 50% of a company’s value
– Baruch Lev, New York University
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Best Practices: Intangible Assets
Non-financial
drivers
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Best Practices: Corporate Governance
Disclosure
•
2/3rds of investors say governance considerations may be a
trigger to avoid investing in particular companies, and
•
80% said they would pay a premium for companies that are
visibly well-governed (source: McKinsey & Co, Global Investors Opinion
Survey)
•
73% of investment professionals say that a company’s
disclosure practices and the quality of financial statements
are very or extremely important factors in their investment
decisions (source: AIMR member survey)
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Best Practices: Corporate Governance
Disclosure
• Board and management bios
• Committee composition
• Insider transactions
• Contact the board
• Policies, guidelines and documents
• Proxy information
• Alerting
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Corporate
Governance
Highlights
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Committee
Composition
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Insider
Transactions
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Best Practices: Provide Multimedia
Video
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Best Practices: Embrace Technology
RSS Feeds
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Best Practices: Embrace Technology
MP3/
Podcasts
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Best Practices: What’s Next?
“Our aim is to move from long, hard-to-read disclosure
documents to easy-to-navigate Web pages that let investors
click through to find what they want. We want to emancipate
the data from the page, and let it find its way across the
Internet and around the world in the form of RSS feeds, AJAX,
applications, and whatever comes next.”
- SEC Chairman Christopher Cox
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Best Practices: What’s Next?
• Blog, podcast spending to reach $757 million in 2010
(WebProNews April 2007)
• Jupiter Research finds that 35% of large companies plan
to start corporate blogs this year.
– Combined with the existing deployed base of 34%, nearly 70% of
all site operators will have implemented corporate blogs by end of
2006
– 64% of executives spend less than $500k to deploy and manage
corporate Weblogs
– "By engaging prospective customers in active dialogue,
companies can showcase their expertise and domain knowledge,
creating a forum for communication of their strategies and visions"
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Best Practices: What’s Next?
Sun
Microsystems
CEO’s Blog
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Best Practices: Globalize Your Web Site
Multi-language
capabilities
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Best Practices: Utility and Access
•
Clear navigation links
•
Format and file size should be denoted
•
Filings and reports available in HTML & PDF
•
Use a vanity URL
•
Printer-friendly
•
Key information above the fold
•
Limit information required from investors
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Best Practices: Utility and Access
Well organized, easy
to navigate and
robust IR home page
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Best Practices: Promote Your Web Site
•
Be discoverable!
•
Direct link to IR from corporate home page
•
Push email technology and RSS
•
Put your website URL in all of your IR communications
•
Don’t link away from the site
•
Leverage third-party technology to extend corporate
reach
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Your Web Site Should…
•
Meet or exceed regulatory requirements
•
Be comprehensive
•
Communicate financial and non financial assets
•
Leverage the latest technology and new media
•
Be accessible to global audience
•
Be fresh and easy to use
•
Learn from others - beg, borrow, and steal!
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Questions?