News releases and websites in disclosure – the experts offer their view

The joy of having a portfolio existence. Last Friday I was on a call with members of the Disclosure Advisory Board, to get their views on the SEC Guidance on the use of company web sites in disclosure. These are genuine experts in their theme. IR Directors from large and small companies, veteran sell side analysts, legal counsel and investor relations consultancies. Many served on the original SEC Disclosure Committee. So when they talk, we listen.

And they have issued their reactions in a paper today.

In summary, their view was that the SEC guidance was very helpful in clarifying what has been a very difficult area for companies. When and whether to use the company’s website to communicate with shareholders has been contentious for some years, and getting assistance from the SEC is great.

However that Guidance falls short of stating that a web posting on its own will satisfy disclosure obligations. Indeed, the detail lays out a check list of things companies should consider before doing so.

In the Board’s view therefore the news release will remain the cornerstone of the communications strategy – especially of earnings releases – for the vast majority of US public companies. Telling the company story – a consistent theme on this blog – is crucial. And it is pointless if no-one can see it.

A ha! I hear you cry, you would say that wouldn’t you, with your affiliation with PR Newswire? Well, yes, except that I didn’t, the DAB did.