T H O M S O N F I N A N C I A L
Best Practices in IR Web sitesNIRI St. Louis
Kelly McPartlandDirector, Web Hosting ServicesSeptember 29, 2006
T H O M S O N F I N A N C I A L
Agenda
• Recent Trends
• IR Web Site is Mission Critical
• Best Practices
• Q&A
T H O M S O N F I N A N C I A L
T H O M S O N F I N A N C I A L
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
E-mail alerts 77%
Web site 59%
Conference calls 57%
Webcasts 45%
Financial database 38%
Top 5 means of receiving financial information:
(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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• 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%)
Recent Trends: Evolving Regulatory Environment
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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
Source: Thomson Financial 2006 Survey
Less often than monthly: 12%
Daily or more often: 29%
Monthly: 17%
Weekly: 16%
A couple of times a week:
30%
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• 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)
IR Web Site is Mission Critical Application: Corporate Web Site Usage
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Best Practices: Comprehensive Content
Source: 2006 ThomsonFinancial 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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Non-financial
drivers
Best Practices: Intangible Assets
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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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• Board and management bios
• Committee composition
• Insider transactions
• Contact the board
• Policies, guidelines and documents
• Proxy information
• Alerting
Best Practices: Corporate Governance Disclosure
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Corporate Governance Highlights
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CommitteeComposition
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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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“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
Best Practices: What’s Next?
T H O M S O N F I N A N C I A L
• 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"
Best Practices: What’s Next?
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Sun Microsystems
CEO’s Blog
Best Practices: What’s Next?
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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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Well organized, easy to navigate
and robust IR home page
Best Practices: Utility and Access
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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!
T H O M S O N F I N A N C I A L
Questions?