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Forum Report: Fair Investor Access
New Program Addressing Fair Investor Access to
Decision-making Information
The Shareholder Forum will be starting a public interest program next
month to address the fair use of new communication technologies for
improved investor access to decision-making information. Our objective
will be to define issues that both corporate managers and investors may
consider in the development of new practices, applying the marketplace
standards established by the Forum's
2010 "E-Meetings" program.
As observed in a wide range of commercial and social applications, the use
of new communication tools can significantly expand access to information
and exchanges of views. The benefits of this improved access to
information should be especially significant to investment
decision-makers, in relation to a particular investor’s interests as well
as to broader interests in efficient capital allocation. Realization of
these benefits will require responsible management of the new tools.
Since practical processes are now available to assure the legitimacy of
participants in electronic communications,*
it is important – both to investors and to the corporate managers who
compete for their support – to develop common understandings of how these
new tools can be used in ways that assure fair access to decision-making
information. The
marketplace standards you established in our 2010 program provide a
sound foundation for this process. To continue, we need your suggestions
of the specific questions that need to be asked.
Examples of suggested questions include these:
§ Who should be allowed to observe, and who should be
allowed to speak? (It’s assumed that this kind of question needs
to be considered in relation to specific applications. The answers can be
different even for generally similar processes of question submissions,
for example, if one case is a company’s inviting suggestions of issues to
be addressed at a quarterly conference call and the other is live
questions during the actual call.)
§ When should anonymity be allowed, and when should a
participant be required to use an actual name?
§ Should investors be able to determine who is allowed
to participate in non-confidential communications with a company’s
management, as in the
“Fifth Analyst Call” experiments?
Please tell us what else you consider important to assure fair investor
access.
GL –April 25, 2012
Gary Lutin
Chairman, The Shareholder Forum
575 Madison Avenue, New York, New York 10022
Tel: 212-605-0335
Email: gl@shareholderforum.com
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