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FEBRUARY 2001 ISSUE 102 Investor Relations

Investor Relations

Investor Relations

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APRIL 2001 ISSUE 104

Investor Relations



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a brief history of disclosure

image obsession in the branding age

Taking wing hiring IROs before IPOs

IR fiesta! Latin American award winners

News flash interactive press releases

Board backlash proxy season looms issue 104

issue 102

Spotlight on Toronto


GUIDE: e-shareholder communications

MAY 2001 ISSUE 105

Investor Relations

Investor Relations

Investor Relations

Investor Relations

The annual annual report report

US Awards Issue

IR lessons from the experts


May 2001


Fighting gravity raising spirits during market mayhem

Balance sheet blues accounting nightmares

Feature survey ADRs

The many faces of FD the Street’s verdict Roadshow spotlight London

JUNE 2002 ISSUE 118 Investor Relations

Investor Relations

Investor Relations

issue 105

issue 114

Nordic stars IR award-winners

The unwinding of Japan Inc. targeting investors

Investor Relations

JUNE 2001 ISSUE 106

June 2001

June 2002

the struggle of Europe’s high-growth markets

The FSA speaks RNS in the future Earnings results online, on time

Rights and wrongs emerging markets governance

World's best IR web sites

GUIDE: CSR, brands & value

issue 106

issue 118

Roadshow spotlight Tokyo

How they do it at Shire Pharmaceuticals

IR magazine Monthly title for the global investor relations community. Design, art direction, production. Covers: my own artwork, or art directed photography and illustration

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INTERNATIONAL EDITION A Cross Border publication


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JANUARY 2007 ■ ISSUE 173

IR magazine

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OCTOBER 2005 � ISSUE 158


INTERNATIONAL EDITION A Cross Border publication

January 2007

October 2005

Corporate advertising at work


Warming to climate change investors want more info

Spotlight on Canada targeting investors here

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Hedge funds gear up

Meeting demands Shareholder get-togethers How they do it at Genentech Issue 173

Issue 158

Superhero CFOs what they want from IR

new face of activism

Fund manager profile Vanguard’s Jim Barrow

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on loan

August 2006

July 2005

The trouble with securities lending


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AUGUST 2006 ■ ISSUE 168

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IR magazine

JULY 2005 � ISSUE 155


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Riding high The best IROs in the UK

Unbundling soft dollars The equity research shakeup

The best CEOs to work for? not mine, says one IRO

Fund manager in exile Bill Browder on Russian risk

Issue 168

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Spotlight on Tokyo a look at the city’s buy side

Nordic cool the region’s best in IR

EUROPEAN EDITION A Cross Border publication

Reach for the top Brazil’s best in IR


IR magazine

IR magazine



EUROPEAN EDITION A Cross Border publication

February 2006

December 2005

Is your company an SRI candidate? The best in European IR analysts and investors choose their favorites

Back from the brink Eurotunnel proxy fight Awards roundup 2005 winners and worldwide trends

Looking back, looking forward in the investor relations empire

Issue 162

Issue 160

Guide: Managing the proxy process

Spotlight on Frankfurt targeting buy-siders in the German city Special research feature: Mining for market intelligence

Guide: AGMs and analyst meetings

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How they do it at Tesco Britain’s premier retailer reveals all

The UK’s IR champions

Climate change the bottom line



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OCTOBER 2006 ■ ISSUE 170

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Best of the Brits

Year of the poison pill Japanese IR transforms

New trends in guidance

Playing for growth Top fund manager profile

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Changing direction Profit warnings Softening the blow


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JULY 2006 � ISSUE 167

EUROPEAN EDITION A Cross Border publication

October 2006

September 2005

Playing matchmaker

Is the options backdating scandal overblown?

Inside the sell side’s most coveted role

Untold stories consultants on IR successes

CEOs under fire The IRO’s best strategy Hot on German equities Investors and analysts weigh in Issue 170

Issue 157

Will the party ever end? the IR behind PartyGaming’s IPO A united front IR and PR convergence


Roadshow destinations Assets down under


iSSuE 193


A Cross Border publication

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EuRoPE, MiddlE EaST and afRica


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THROUGH THE GLOOM Roadshows in the roughest market



how fast can you sell your investment story? guidE: an inTRoducTion To ShaREholdER analySiS RighT To RulE

ScREEning STocKS

BanKing TRiuMPh

The best and worst ways of reporting cSR page 28

opposition rises to practices at hong Kong firms page 38

how unethical company decisions affect investors page 43

lenders bag top prizes at uK awards page 49


iSSuE 193



a TiME

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News bots complicate investor relations page 24

Chinese firms face the brunt of the downturn in Singapore page 28

Surveillance firms dig for detail page 32

Juggling IR with two other jobs is not easy page 34

10/12/08 16:35:25

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MARCH 2009



A Cross Border publication

A Cross Border publication

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MARCH 2009

JUNE 2009



Integrating IR after a merger



Sell-side shake-up restores consultant role. Plus: our annual directory of IR agencies page 35

Global economic downturn prompts rethink for multiple-listed companies page 46



UNTANGLING THE WEB Experts rank 10 blue-chip corporate websites based on three-minute inspections page 28





Rival companies cope with fallout from India’s Enron page 21

Corporate access teams shrink in Europe page 24

Firms face serious challenges in the 2009 AGM season page 29

Never judge an annual report by its cover page 42

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MAY 2008


A Cross Border publication

August 2007

issue 180

A Cross Border publication

IR magazine

IR magazine

emeA eDition


MAY 2008

August 2007

ActiVists witH


election-style investor rebellions hit the web




A Brazilian-born, US-educated, UK-based IRO

enDing tHe PAciFic DiViDe

Australia could set an example for others by reconciling listing rules with the us page 48

norDic ceLeBrAtion Partying in oslo with the winners of the ir magazine nordic Awards page 52

VirtuAL communicAtions

sainsbury’s ir chief, elliot Jordan, is our guest advice columnist page 8

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issue 180

cutting-eDge Design this year’s best looking annual reports. Plus: our directory of creative services page 28





Inside the world of Doha’s 42 listed companies page 30

Getting to the bottom of SWFs as they flood into listed companies page 35

AGMs prove to be ideal stomping ground for activist investors page 50

Ecclesiastical fund marries old-fashioned value to SRI page 53

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iSSue 208

A Cross Border publication

IR magazine

IR magazine



A Cross Border publication

MAY 2007

December 2009



Shareholder engagement around executive pay can lead to broader dialogue

Shareholders have their say on compensation SPeciAl SuPPlement: CORPORATE ACCESS cheAt Sheet

meDiA trAining

beSt PrActice

cAPitAl mArketS

Proxy season hot spots: proxy access, rule 452, notice and access, and more page 22

14 tips for doing better on camera and in presentations page 24

the next-generation iro’s five strategic priorities for ‘data-centric’ ir page 30

what do iros need to know about Shariah investment and islamic finance? page 32

13/11/09 14:16:54

WINNERS’ REPORT FROM THE IR MAGAZINE CANADA AWARDS BRAZILLIONS – Tough governance standards have drawn more capital to São Paulo’s exchange page 29 ISSUE 177

iSSue 208 00 cover.indd 2

MAY 2007

ANNUAL REPORTS – How to win contests and stand out from the crowd page 36 CORPORATE ADVERTISING – How Hitachi and UTC reach Wall Street with their image campaigns page 41 HOW THEY DO IT AT QUALCOMM – IR and marketing combined help the tech giant through a litigation storm page 53

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jonathan fortune _Layout 1

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ned to ed determi der emerg RY HAINES one defen summer. GA Yorkshire, rtune during the d spell in nt good Fo to ue d rre lag ne cu ur ’s y-p ret ton by an injur the club he yed his part in Charl Frustrated – just like pla ck s ba ha y k squad wa the Addicks battle his erving Addic A member of w a long-s finds out ho tart second Fortune’s

a stop-s rship, in the Premie time following on red k into Charlt club. transition bac spell at the ence abs the he was on in ristmas mless, and t to fill fans sea s Jus wa that the Ch erm 30-yearand gift ded a short-t t season; the from the loft eventually han of Fortune las come down r. ation with g friends end of this yea long associ ulated amon tract until the con old ended his lists are circ ing for his mer 2009, join wait patiently club in sum He’s had to the and family. . sion ited and Un pen sus eld rife, ne, but the ons remain ip side Sheffi Such traditi chance to shi Championsh tune ryian Dailly has owing an inju Jonathan For rist of foll Ch , e er ver enc pp we Ho to ski the abs nu in SE7 Lane, the a solid run in r’s festive me ll at Bramall the door for plagued spe from last yea re opened ber. mas Day self once mo ch like Christ ing into Decem k found him mu go m tty bac tea pre tres the cen wa r– for the eech. s a year late ered the fray Queen’s Sp g fresh pasture d having ent kin An see without the ntwhen orn in the s of the incide nt full circle ender is reb g 15 minute his career we sin The big def clo and , Lane. son, though k at Sparrows ble this sea he arrived bac Addicks sta t for los to make up and is keen

r e of the yea

I t’s around this tim decorations


n last with Yeovil Tow packed clash alongside tune started Saturday, For ek Valley in the midwe Gary Doherty l Rovers. sto Bri h wit draw ning ended the eve Indeed, he band after captain’s arm wearing the medo left pper Jose Se stand-in ski ond half. ly in the sec the action ear on last ed to come “I was surpris er, e as a defend aus bec , weekend come off the ally usu n’t you do whose d Jonathan, bench,” sai to an ing took him midweek out

ed.” and so prepar concentrated when the club. co held firm 4 games for Fortune and aggregate 20 ut abo vers, inst the Glo g to Christian rthanded aga “I was chattin sho re also e, and we we visitors were and after the it after the gam the ly end, bab men near the defence is pro uced to 10 saying that ing on. red proved n’s penalty fulfil after com kso to Jac role e t nni Joh hardes ger can rward or win 3-2 win. “A centre-fo decisive in a s in from olved, and Fortune wa e and get inv On Tuesday, take his tim , you are or l bal began his ban the ntrol start as Dailly the if you mis-co stretch the ing to n it’s not go ender helped and the def not ready, the all eaten run in too much. Addicks’ unb affect things ender es. take as a def to nine match “But one mis competitions al go said on gh evening,” al or a chance “It was a tou and it’s a go so be to e m. So you hav tea ir the for


_Layout 1

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t 1 24/11/ 2010


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9th, 2012 Monday, April £3 Kick-off 3pm

v Walsall

n a s s e u g ’ n y n da M a k in g a m a r


6-8 n'guessan_walsall_Layout 1 05/04/2012 16:58 Page 1

6-8 n'guessan_walsall_Layout 1 05/04/2012 16:59 Page 2

S eventh wonder outing for parent club Millwall, and he also scored in

features from the start or emerges from the bench

his first matches for Scunthorpe United in November

this afternoon. But whatever happens, fans are

2010 and Leicester City in August 2009.

advised to start a seven-minute countdown. In his last two Valley appearances, loan signing N’Guessan has sprung into life at exactly that moment. Against Yeovil Town on March 20th, his cross-cumshot flew into the top corner for a stunning debut goal

although it should be noted that his FA Cup opponents that day were Manchester United. When asked whether he intended his goal against

only seven minutes in. And after replacing Bradley

Yeovil, N’Guessan smiled: “I think everybody saw that

Wright-Phillips in the 75th minute against Leyton

I was trying to put the ball in a good area, and it just

Orient, N’Guessan’s image flashed up next to the

went into the top corner. But I’ll take it.”

word ‘goal’ on the big screen just seven minutes later. Seven is supposed to be a lucky number, and a man who is carving out a reputation for making a fine first impression is happy to be back playing again. So Walsall beware, the Seventh Wonder of The Valley is on the prowl. “I’m delighted that things are going so well,” said

So what of this instant impact, and where does it come from? “I don’t know,” he replied. “I just thank God. I’m really happy with my start. When you come to a big club, you have to show people what you can do. If you do that in the first game, it’s always a bonus.” After the Addicks slipped to defeat at Huddersfield

Dany, who arrived at the club 24 hours before the

Town four days later, N’Guessan had to make do with

clash with the Glovers, honouring a pledge he made

a place on the bench against Orient as Lee Cook

to a former Leicester City teammate in the process.

came in at left midfield. But for the second time in his

“When Chris Powell called me before he left

He’s a striker with a notable knack for scoring on his debut, and one new Addicks forward has continued that happy trend at The Valley. GARY HAINES talks to a loanee who is looking to help a club gain promotion from League One for the second time in 12 months

The perfect sequence was interrupted when he failed to net on his bow for Southampton last season,

short Addicks career, he supplied the perfect

Leicester, I said to him ‘one day, I will play for you

prescription for calm when all in SE7 were starting to

because I want to play for you’. I didn’t know that it

bite their fingernails and fidget in their seats.

was going to be so soon, but I was delighted to hear from him and I’ve settled in really well.” You never get a second chance to make a first

Unleashed up front, N’Guessan soared to head the ball into the net from a fabulous cross from Cook. “The manager talked to me before the game,

impression, or so they say, and N’Guessan continued

and said that he wanted the balance of a natural

his incredible knack of scoring on his debut with that

left-footer on the left wing, so I was OK with that,”

early strike against Yeovil – whether he meant it or not.

said the 24-year-old.

Last August, he netted 14 minutes into his first

“He’s the man making the decisions, so you have

6-8 Sullivan_Leyton Orient_Layout 1 29/03/2012 16:22 Page 1

6-8 Sullivan_Leyton Orient_Layout 1 29/03/2012 16:22 Page 2

ONE GLOVE Never off the teamsheet during his time with the club, John Sullivan has played a pivotal role in the club’s fine season. GARY HAINES talks to a goalkeeper who organised a team outing to see a music megastar – but is happy to admit that he owes everything to his mum

Addicks’ ranks permanently in the summer, and

bench, and saw Hamer make a magnificent close-

Sullivan has five cup starts to his name in 2011/12 –

range block from Jordan Rhodes before the striker

not to mention two emergency substitute appearances.

grabbed the decisive goal from the penalty spot.

Regular viewers of Take Me Out will require no

campaign, having featured in the matchday squad for

explanation of the premise of ITV’s hit dating show.

every game. Add a further four starts and eight substitute

One of those came in the reverse fixture against

appearances last season, and Sullivan’s name has been

today’s opponents Leyton Orient, on December 31st,

11 men still on the pitch, I think we would have gone

their own assessment of him during an often dubious

inked onto the teamsheet on 57 successive occasions

and Sullivan also entered the fray late on at AFC

on to win the game,” noted Sullivan, who has also

vetting process. There are always plenty of outstanding

– more than any other Valley player.

Bournemouth on March 3rd.

represented Yeovil Town and hometown club

One suitor gets to pick from a panel of 30, who offer

candidates, and the clutch that face an arduous wait

Asked to compare this season and last, John

generally become more popular with the public – and

replied: “It’s the fact that the club is doing well this

their selection rivals.

year – there is a feel-good factor about the place.

“I didn’t need too much convincing to sign here again,” he added. “It was a tough time last season,

“If we could have reached 60 minutes at 0-0, with

Brighton & Hove Albion. “We just need to dust ourselves down and move

programme, John Sullivan, who has certainly earned

1 the gaffer’s done a terrific job rebuilding the squad. :38 Pagebut /03/2012 17 t 1a 28 ouon “When I was here last year, weay were bad run, “To get 20-odd players into a new team, and do ient_L nt_Leyton Or Fro 1 and sometimes people do change because they are what we’ve done, is an unbelievable achievement.

his spurs at Charlton and is hoping to be ‘the one’.

under a lot of pressure. We had a lot of loan players

A lot of that is down to the gaffer, of course, but

needed a pick-me-up following the defeat in

and sometimes that can be hard. I think the main

most of the credit has to go to the players.

Yorkshire, there was only one man for the job.

This brings us to a reported regular viewer of the

At 24, Sullivan is the same age as current Addicks number one Ben Hamer, but he has mainly been

reason we have done well this season is because the

reduced to a back-up role during his time at the club.

core of the team has stayed the same.”

There are few lonelier occupations than a reserve

Sullivan first arrived in SE7 on loan from Millwall last

goalkeeper. But Sullivan has nevertheless played a

March following an injury to Rob Elliot, and he debuted

significant role in the club’s progress on and off the pitch.

at Oldham Athletic the following month.

Indeed, he is well versed to pass judgement on the

Chris Powell then moved quickly to add him to the

on. We are in a good place and just need to believe in ourselves, stick together and keep going.” On the subject of sticking together, when the team

“Everyone gets on so well, and everyone who has

Indeed, when rap superstar Drake announced a

been here has been a good character. If anyone gets

stadium gig at the O2, it was the keeper who took

out of line, we have players here who will keep them

care of the ticketing issues – and made one young

in order. But it’s not been needed.”

teammate’s dreams come true.

Sullivan had a good view of last Saturday’s clash against Huddersfield Town from his place on the

“The spirit in the camp is great, and I arranged with a Charlton fan who runs a box at the O2 to get some

h 31st, 2012 Saturday, Marc £3 Kick-off 3pm


v Leyton Orie

john sullivuaens C u s t o d y is s

ww FEBRUARY 2008

MAY 2010



A Cross Border publication

A Cross Border publication

IR magazine

IR magazine



MAY 2010



THE HUNT IS ON Finding and facing proxy voters

Straight talking from the Swiss pharmaceuticals giant







Inside the secret world of algorithmic trading page 41

Western exchanges flex their muscles for Chinese companies page 47

IR winners at our Hong Kong and China awards share their views page 52



How investor pressure led to the biggest-ever banking deal page 31


The inside story of Kraft’s takeover of Cadbury page 20


Tips on diversifying the shareholder base page 25


New market intelligence tools for issuers page 31

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The winners reflect on a tough year page 37

15/4/10 13:09:34

10/1/08 13:28:46

Roadshows IR magazine

IR magazine Roadshows

Foot on the gas Craig Mellow tracks Gazprom, Russia’s biggest company, on its US investor offensive


he recent New York leg of Gazprom’s investor day was sparsely attended. Mounds of appetizers went uneaten at a lunch reception 40 floors above lower Manhattan. Sergei Kupriyanov, the Russian gas giant’s press secretary (doubling as IR point man for the roadshow), was besieged by no one except a lone family-office representative and an energy-policy researcher from Columbia University. But Kupriyanov takes the long view. ‘Nobody doubts that for the next 10, 15 or 20 years gas will be a commodity in great demand,’ he maintains. Moscow-based Gazprom, which controls one third of the world’s known gas reserves, launched the investor-day tradition in 2008. The Russian state controls a bare majority in the company, 50.002 percent of shares. Private investors own the rest, including 21 percent traded on non-Russian exchanges as American depository receipts (ADRs). Last year’s meeting had a celebratory air: energy prices were at record highs and Gazprom had become one of the world’s top 10 corporations by market capitalization. This year Kupriyanov and Gazprom’s executive front men – finance director Andrey Kruglov and export division chief Alexander Medvedev – had to

Destination Canada


Fund managers like to see Toronto listings

n March 2005 the floodgates to a multi-billiondollar pool of capital suddenly and unexpectedly burst open. That’s when the Canadian government eliminated the 30 percent cap on foreign investments by registered pension and other deferred income plans. Since then, Canadian institutions have steadily ramped up their international equity holdings. A Greenwich Associates study reveals that overseas allocations jumped from 51 percent of total equity portfolios in 2004 to 58 percent last year. The foreign surge seems far from cresting, according to study author Rodger Smith, a managing director at Greenwich Associates. ‘Canadians have come a long way, but it looks like they will go further,’ he says. ‘Canada represents about 3 percent of the MSCI World index, and by that benchmark foreign exposure is still under-represented.’ Of course, all this new money looking for a foreign home has not escaped the attention of globe-trotting IROs – but is Canada now a hot new stop on their roadshow tours? As Smith points out, a significant portion of Canadian assets is still managed offshore. Despite that caution, however, Canada is beckoning

44 August 2008

Gazprom’s charm strategy in this tough situation is to admit it is in a short-term muddle – though not of its own making – while stressing its reliability as a long-term play. ‘The most complicated question from investors, which we can’t answer yet, is how our budget and production will need to be corrected for this year,’ Kupriyanov says. Prices on the European exports that bring in a quarter of Gazprom’s revenue are predictable thanks to long-term ‘take or pay’ contracts, he adds. But revenue within Russia and the former Soviet Union is subject to government pricing controls and the depreciation of the ruble,

IR magazine Roadshows

Money stops Toronto-based international equity managers include: ontario teachers’ Pension Plan sky Investment Counsel tD Asset Management Gryphon International AIM trimark sprucegrove Investment Management Burgundy Asset Management

BY Jeff Cossette

Investors drawn to long-term orientation

Charm offensive

44 April 2009

Roadshows IR magazine

More global IROs putting Canada on the itinerary

put a brave face on a very different situation. Gazprom shares have lost two thirds of their value since last July and production has dropped by more than 10 percent. The company took a fresh PR bashing in winter as it cut supplies in a recurring dispute with Ukraine, its main transit country to customers in Europe. And then long-time IR head Dmitri Zhdanovich defected to state financial powerhouse Sberbank, leaving Kupriyanov to improvise while the department, as he puts it, restructures.

like never before, and many investor relations professionals are answering the call. Sophie Jolly, head of IR at Finnish elevator and escalator company Kone, is one of them. She is planning a visit this fall. ‘We’ve never been to Canada before, but all my research suggests there’s a lot of potential there,’ she says. ‘As we say in Finland, we’ll knock on the ice to see if it can carry our weight.’

and fragrance giant Givaudan. He’s been traveling to Canada for seven years, and Toronto-based shareholders presently own more than 3 percent of the company. ‘The Canadian style is somewhat different from that of New York,’ comments Wullschleger. ‘In my experience, Canadians are generally much more drawn to fundamentals and a long-term

Cream of the crop A major attraction for Jolly is the promise of catching the attention of high-quality, long-term investors. ‘Our business is a long-term one and, especially with today’s volatile market, it would suit our ownership structure to have matching investors,’ she says. ‘Canada is a place where we expect to find them.’ That seems to have been the experience for Peter Wullschleger, head of investor and media relations at Swiss-based flavor

‘We’ve never been to Canada, but we think there’s a lot of potential there’ sophie Jolly, Kone

orientation. If you are visiting the east coast of North America looking for value-driven investors, Toronto is a must-visit. There’s a lot of interest up there that sometimes gets overlooked.’ That sentiment is echoed by Frank Boer, New York-based vice president of sales at Chevreux, Crédit Agricole’s brokerage arm. ‘Our clients have definitely noticed that more money is available since the restrictions have been lifted,’ he says. ‘It’s been very visible.’ On top of a penchant for the long haul, Boer points out a number of additional Canadian charms: ‘The Canadian fund management industry has seen considerable consolidation, which makes one-on-ones a lot more effective. And, because it is relatively rare for Canadians to see companies, they tend to come to each meeting very well prepared.’ Kevin Kusterer, a sales associate at New Yorkbased small-cap equity research provider Sidoti & Co, agrees. ‘Canadians aren’t overwhelmed with meetings and always seem prepared and ready to go,’ he points out. ‘Some people don’t expect the expertise or money to be there – but it is. Canada is definitely worth the trip.’

Cold cash An important driver of Canadian capital may be the desire to diversify away from domestic resources. ‘For years you could almost throw a dart at resource companies and make money,’ says Kusterer. ‘Nowadays a lot of people have a lot of money as a result of the resource boom, and they want to diversify to the US and away from Canada.’ How deep and robust that desire really is remains to be seen. ‘It is curious that Canadian pension funds would continue to significantly underweight US stocks,’ says Rick Hanley, managing partner at New York-based Hanley & Associates, which conducts non-deal roadshows. ‘They are now free to invest as much as they want, and the MSCI index would suggest a benchmark weighting in US stocks of over 50 percent on any given day. The actual day-to-day exposure of Canadian managers toward US companies and the economy does not appear to have approached this benchmark weighting, however. When you factor in August 2008 45

which has lost half its value against the dollar since the global economic crisis hit Russia. To accentuate the positive, Gazprom is redoubling efforts to show off prize projects to investors and journalists. In February the company hauled a brave group to Sakhalin Island, unveiling a new liquefied natural gas plant aimed at making Gazprom an energy player in east Asia. A future excursion is scheduled for the Arctic, where the company will unveil a railway bridge critical to supplying its future gas project on the Yamal Peninsula. ‘We want to show people how our company breathes,’ Kupriyanov says.

‘Nobody doubts that gas will be in great demand’ But many investors are less curious about Gazprom’s physical infrastructure than the financial complexities of a holding that reported $25 bn in profit on $70 bn in sales for the first nine months of 2008. The company, formed from Soviet assets after the fall of communism, has had a checkered governance history. Huge swathes of gas reserves disappeared in the

1990s, ending up under the control of a new entity called Itera. Most of Gazprom’s downstream chemical facilities were spun off into a firm called Sibur. Gazprom has clawed back most of its lost assets under current CEO Alexey Miller. But investors continued to question the company’s financial probity. The annual Gazprom report published by Hermitage Capital, a fund headed by US-born investor Bill Browder, became a much-anticipated event in Moscow financial circles, documenting billions in alleged waste on practices such as overpriced contracts with related parties. At least it was, until Browder had to leave Russia when he was denied a reentry visa in 2005. Gazprom eventually replied in detail to Hermitage’s critique, arguing that its higher-thanaverage pipeline costs reflected difficult Russian terrain, and investors piled into its shares as energy markets soared from 2006 to 2008. But Kupriyanov admits that suspicions remain. ‘I will consider our job done when investors at meetings stop asking systemic questions like, What is being done to make the company more transparent?, and ask only about what is happening at the company, the current numbers, and so on,’ he says.

New challenges Meanwhile, the IR profession itself evolves in post-communist Russia, where practitioners trained on-the-job – like Kupriyanov – struggle with their first prolonged bout of crisis management. At 34, Kupriyanov is old enough to be senior in his still-young profession. He studied economics at the prestigious Moscow Institute of Physics and Technology, did a stint at the Ministry of Economics, then spent seven years as a manager at a start-up trying to pioneer financial information for Russia’s volatile markets. One of his pet peeves is investors and others seeing Gazprom as an arm of the Russian state. ‘What frustrates me is people who believe the stereotype that Gazprom is the energy weapon of the Kremlin,’ he says. Even so, he understands that perceptions of his company and of Russia writ large are inextricably intertwined, and that confidence cannot revive in one without the other. n April 2009 45


045-047 compass on the map



Page 46

Scandal in the sector

Compass points


‘India’s Enron’ shocks investors with misdeeds Brazil Brazil has outstanding investor relations, not least because it’s mandated by law. ‘A listed Brazilian company is obliged to disseminate the name of its IRO as the member of management legally responsible for the entire corporate relationship with the market,’ Geraldo Soares informs us. He should know – as well as being president of Instituto Brasileiro de Relações com Investidores (Ibri), he is IR superintendent for Banco Itaú and was voted best IRO at the IR Magazine Brazil Awards 2005. Soares says his professional compatriots have had a lot to contend with in Brazil, where for years every emerging markets crisis around the globe reverberated immediately through the Bovespa. But Ibri, with over 250 members, does its best to relieve the strain. Since 2001 it has held 76 events including seminars, open webcasts, informal meetings and an annual, national conference in June. Last year the program included Sarbanes-Oxley Section 404 requirements, the issue of sustainability as a value driver for companies and the financial implications of climate change, reaching a record number of 1,900 participants during the year. In March 2001 Ibri set up the first MBA course in IR anywhere in Latin America, and it now has 95 graduate and current students. Another potent source of professional honing has been the exponential increase in the number of Brazilian companies with American depositary receipts (ADRs) in New York and all the consequent demands for information. In 2005, for the third year in a row, Ibri coorganized Brazil Day at the NYSE, with 28 Brazilian public companies putting their case to the international financial community. Ibri works closely with Brazil’s professional and regulatory bodies such as the Comissão de Valores Mobiliários (CVM), Brazil’s equivalent of the SEC, and the Brazilian Association of Investment Professionals and Capital Markets Analysts (Apimec), whose offices Brazilian IROs often use for analyst and investor meetings. ‘Here an IRO can gauge what he or she is doing right and wrong based on the demands and perspectives of the public and, in so doing, reevaluate his or her strategic and tactical posture,’ says Soares.


IR magazine

Bulgaria Founded in September 2005, the Bulgarian Investor Relations Society (Birs) built on the foundations of a Bulgarian investor relations directors club, set up in 2003. Of all young IR bodies, Birs seems to be the most active, not least because of the professionalism and intellect of its chair, Bogomila Hristova. She began in the profession in 1995 as ‘chief secretary, which includes the activities of corporate secretary and relations with shareholders,’ she explains. That was when Industrial Holding Bulgaria was privatized, beginning with 112,000 retail shareholders, all beneficiaries of the privatization vouchers issued by the government. Since then Hristova has guided the IR activities of the company, whose highly professional web site, in both Bulgarian and English, shows how IR culture has penetrated this country. However, Hristova herself details how strenuously she has had to work to persuade management in her wideranging conglomerate that transparency and rapid information sharing is essential – no easy task in a society where half a century of communist rule had made almost any detail of business a state secret. With equity markets still in their infancy in Bulgaria, regulations and practices have continually changed as the government and industry strive for the right balance. That has meant headaches for the members of the society, compounded by the need to harmonize laws in advance of EU membership. The society’s 22 members – six men and 16 women – assemble regularly in ‘meetings, seminars and presentations for education and discussions related to legislation and development of the capital market,’ Hristova says. The society also invites foreign lecturers, usually IR professionals, to speak. Although Bulgarian law mandated an IRO position in 2002, it is still an uphill struggle to explain the profession to ordinary Bulgarians. On the other hand, Hristova and the society’s members are very conscious and proud of Bulgaria’s ancient history – and equally conscious that few foreigners know about it. They see a major part of their task in professionalizing IR so that investors – domestic and foreign – will find investing in their country safe and attractive.

Satyam rivals hit by governance and accounting questions Firms tap advisers for crisis management suggestions


he list of problems befalling Satyam Computer Services is enough to stop any IRO in his or her tracks. Since former CEO Ramalinga Raju admitted in early January that he falsified accounts and disclosure over several years to make the business appear more promising, there has been hell to pay. Satyam, which is listed in India and New York, has been abandoned by investors and clients, had its trading suspended, become the focus of a dozen lawsuits and investigations, and had sell-side banks saying they no longer have any basis for determining an investment rating. It all amounts to a predicament of ‘horrifying magnitude’, as one regulator described it.

This makes it triage time not only for Satyam, but also for all the IT outsourcing companies in its sector. Long considered some of the leading companies in India, rival firms like Infosys, HCL and Wipro now have their own challenges scrambling to protect their reputations as investors wonder whether Satyam’s weaknesses aren’t an aberration. The Satyam situation is also serving as a reminder to all listed companies to review their own disastercoping skills. ‘Frankly, all large-scale businesses and their advisers need to ask themselves, What if it were us?’ says Nicky Havelaar, managing director of London-based Crown Business Communications. The crisis has public companies potentially calling in a range of IR advisers including specialists in communications, conferencing, market intelligence and proxy and governance issues to study the Satyam story. ‘Fortunately, major frauds aren’t an everyday occurrence in the corporate world,’ Havelaar says. ‘But they do occur with sufficient frequency that corporate advisers need to have a skeleton campaign plan ready to go if the worst happens, either to the firm, a comMarch 2009 21

021-023 F-crisis_management.indd 21

9/2/09 12:56:11

IR magazine Technology

MARCH 2006

Exclusively on the

web By Tim Human


Google to disclose earnings releases exclusively through website Other companies remain cautious but access their options Debate puts Google and Microsoft at odds over disclosure policies

Back to the


t shouldn’t have come as a surprise to anyone when, in April, Google said it would make financial announcements available exclusively on its IR website. For one thing, Google has a track record when it comes to tweaking the earnings process: IR magazine’s cover story in March told how the company used its Moderator application to field questions in Q3, then streamed its conference call over YouTube in Q4. More changes seemed inevitable for Q1 on April 15. Furthermore, it’s now almost two years since the SEC updated its guidance that said companies can disclose over the website and satisfy Regulation FD, as long as certain conditions are met. It was about time someone tested this guidance to the limit – and the obvious candidate to do so was Google. Until April, several companies had experimented by issuing advisory notes instead of full press releases, pointing investors toward the IR site where they could find the full earnings release, which is sometimes referred to as a notice and access model.

drawing board BY CLARE HARRISON

Sell-side model evolving rapidly as downturn bites Small and mid-cap firms suffer from reduced coverage Companies look for new ways to get on investors’ radar


eople have been proclaiming the death of the sell side for years, but it is hard to deny that it now faces a more serious challenge than ever before. A catastrophic recession, an increase in electronic trading, Regulation FD and, of course, Eliot Spitzer have all had a role to play in helping to remould the old investment banking model. Tabb Group data for the US reveals that the commissions paid to the sell side by the buy side have shrunk from 3.89 cents a share in 2004 to 1.89 cents a share in 2008. The upshot of the lower commissions is that trading volume wins the day: large firms with high volumes are still moneymakers for the sell side and so are retaining their coverage. ‘I estimate that the sell side has to generate 12 times more trading volume today to make the commission it was getting in 2000,’ comments Dan Dykens, CEO of Meet the Street, a facility that matchmakes investors with public companies that fit their investment criteria. ‘Smaller caps with less volume

do not generate sufficient revenues, which is why companies like Google and Microsoft can still be covered by 35 analysts each while everyone else loses out.’ The squeeze has also been exacerbated by the collapse in valuations, which has led to a proliferation of small and microcap firms. For the majority of these less fortunate companies, the sparseness of analyst coverage signals a substantial IR challenge. ‘We had one Biotech firm that had 10 analysts covering it and now it’s down to two – that’s significant, and it’s happening on a widespread basis,’ comments Rob Whetstone, managing director of IR firm PondelWilkinson. Despite the challenges, Whetstone says firms should not give up hope of obtaining new coverage. ‘There are definitely analysts looking for new directions and if you have a good idea they may well begin coverage. Some

June 2010 45

June 2009 35

035-039 F IR agencies.indd 35

In fact, BGC Partners, the interdealer broker, first tried this tactic back in February 2009. Other more recent adopters of the advisory note route include Expedia and Marathon Oil Corporation. But none of them said it would start disclosing exclusively through its website. This is a gray area as websites must meet certain qualitative factors to satisfy Reg FD, such as being widely followed and having developed a pattern of web-based disclosure. The big question now is whether anyone else will follow suit. Other issuers are certainly considering it. Michael Littenberg, a partner at New York law firm

11/5/09 10:44:22

Profile IR magazine

IR magazine Profile


spend more time with investors to convince them to invest.’ The task of persuading investors to commit to Eurotech is made easier by the firm’s focus on the business-to-business (rather than business-to-consumer) market, as well as the fact that it makes critical electronic components for MRI machines and wireless internet systems for buses and trains, the latter being considered a financially sound area. ‘A specific part of the Obama plan is dedicated to improving access to wireless broadband,’ Barbaro points out.

gets tough

Fay Sanders grills Andrea Barbaro on his plans for transforming Eurotech into a multi-billon-dollar company

expanding horizons

pass this glass ceiling quickly to reach a critical mass and be in the top 10,’ he explains. Now Barbaro’s task is to lead the company through a phase of organic growth, despite the tough market conditions. ‘I would be lying if I said we’re not having a few problems,’ he admits. ‘But falling stock price is a reflection of the general situation and not symptomatic of any company-specific issue.’

Barbaro is keen to reach investors on the other side of the Atlantic, as 45 percent of the company’s revenues are generated in the US. ‘Investors are putting money into our US-based peers, so they could also put some in Eurotech – but they need to know our company before they can do that,’ he adds. Quite how he intends to get a slice of US capital is still uncertain. ‘We have to work out which are the most interesting investors,’ he notes. ‘Those already investing in our competitors will be easier to approach.’ Eurotech stands apart from its domestic counterparts with its 78 percent free float, unusually high for an Italian company. ‘It was a matter of having an IPO that was a bit different from the Italian standard and closer to the UK or US model,’ explains Barbaro.

Sticking to the plan The crisis has made little difference to Eurotech’s organic growth strategy, insists the IRO, who is also in charge of strategic planning. ‘We’re going to focus on transport, medical and defense, which have government backing, rather than on industrial or commercial, which we’ve previously been strong in,’ says Barbaro, who stopped by IR magazine’s London offices en route to a site visit at a Cambridge subsidiary. Barbaro is surprisingly unfazed by the financial meltdown. ‘The embedded electronic market will become more consolidated,’ he says. ‘The bigger firms will get bigger and the smaller ones will get smaller or disappear. We’re lucky to be in the top 10 right now, so we should grow despite the crisis.’ He admits investors are more cautious, but says there are still plenty of good opportunities. ‘They’re just harder to identify,’ he maintains. ‘You need to



big challenge lies ahead for Andrea Barbaro. His appointment as IR officer at Eurotech just under a year ago marked a brand-new approach to IR at this burgeoning Italian tech company. Following the firm’s listing in 2005, former IRO Massimo Mauri led a fiercely acquisitive campaign across Europe, Asia and the US, which Barbaro describes as a tricky, yet necessary, process. ‘There’s a gap between the majority of firms in our market that are worth up to €40 mn ($56 mn), and the few firms that are worth €100 mn and above. It was important to

36 July 2009

July 2009 37



The indie

e v i t a n r e t al Small and mid-cap companies get exposure via independent investor conferences






Diverse audiences at independent events add value


he investor conference schedule may seem dominated by the big sell-side investment banks that choose who presents and who attends. But there are other options for companies – and a way to combine these events with sell-side conferences to maximum advantage. No one can deny that a sell-side conference is a powerful way to get in front of key members of the investment community. But one of the drawbacks is the limited control afforded to presenting firms, with banks often inviting only their own clients and giving priority to their favorites, including hedge funds. ‘Investment banks do a fine job of hosting confer-

Avoiding conflicts inherent in mainstream i-banking conferences

tools to broaden reach. The WSAF recently added two new features not available at investment bank conferences: posting CEO interviews on and posting transcripts of a firm’s presentation and Q&A on Yahoo! Finance and Google Finance. ‘Analyst conferences will increasingly be defined by those that leverage the use of new media to reach professional investors,’ comments Scott. Germán de la Roche, CEO and founder of Arch Investment Conferences, which has events in New York and San Francisco,

ences, but they always put their interests first and those of public companies second,’ points out Gerald Scott, president and founder of the New York-based Wall Street Analyst Forum (WSAF). ‘Sell-side investment banks probably won’t let any other sellside representatives attend their events and will probably invite only the buy side,’ adds Bill Moyer, vice president of capital markets at the Independent Petroleum Association of America (IPAA) in Washington, DC. Some of the other conference options available include those hosted by trade associations, securities analyst societies, independent conference organizers and smaller investment banks that also perform an IR function. There are also DIY events held by groups of companies or dinner presentations for small groups of analysts.

‘Investment banks always put their interests first and those of companies second’

Pay to play The WSAF, a three-day event held regularly in New York, is one example of an independent conference. Around 50 firms present to an audience of 300 buy and sellside analysts, portfolio managers, independent researchers and financial press. In addition, companies may invite their own roster of analysts and portfolio managers. The cost per firm is $3,900; the audience attends for free. The idea behind the conferences, according to Scott, is to add more value for the presenting companies by being impartial, opening the event to the whole investment community, and harnessing media

agrees that the impartiality of independent conferences is important to presenting companies. ‘There are various hybrid conference organizers that provide investment banking services as well as hosting events for their clients,’ he says. ‘Being neutral, however, we don’t represent any of the companies that present and we don’t have any stock invested in them – so we can offer a very different service.’ What makes Arch conferences unique, according to De la Roche, is their panel format: company executives take part in a Q&A session with a panel consisting

30 July 2007

IR magazine Listings


the price isn’t right Arbitraging should, in theory, lead to equal stock price valuations across markets, but it does not always work out like that. ‘Russia has put a number of non-domestic ownership limitations on ‘strategic companies’, a term it has used fairly broadly,’ says Anthony Moro, head of emerging markets’ depositary receipts (DRs) at the Bank of New York Mellon. ‘There is also a maximum allowable limit in Korea.’ Dual stock pricing discrepancies between markets are also commonplace in markets where currencies are not exchangeable, such as China. This has led to a premium on A-share listings. Commentators have speculated that Thomson Reuters, a firm whose London stock frequently trades at a discount of up to 20 percent to its Canadian listing, may reconsider its arrangement in the future. ‘Discrepancies happen in countries where traders don’t have the ability to freely cross borders,’ Moro explains. ‘In the UK you’ve got stamp duty reserve tax; that puts an artificial barrier in place, making one security more attractive than the other.’


Clare Harrison asks whether firms should be reconsidering their listing options in the current environment


46 June 2009

Lawyers have also stressed the possible legal fallout from the programs, warning of potential class action suits filed by investors companies didn’t even know existed. The depositary banks have been quick to point out that firms can take control of their programs if they have concerns, however. ‘Companies can either contact the depositary bank and ask it to close down the ADR, or they can set up a sponsored program,’ explains Claudine Gallagher, head of securities at JPMorgan.

not lucrative Gallagher denies firms are being forced to set up sponsored programs to help line the pockets of the DR banks: ‘The Level 1 programs are not that lucrative for the DR banks and only a few firms have set up sponsored Level 1 programs as a result of the proliferation of unsponsored ones.’

Springboard to coverage For emerging companies, these events can also be an ideal springboard to greater coverage, notes Mark Warren, director of IR at Alabama construction materials company Vulcan Materials. ‘A few years ago we had just four or five analysts covering us, so the opportunities to present were limited, and I couldn’t get Vulcan into sell-side conferences where we weren’t covered,’ he says. ‘The WSAF provided an opportunity for us to tell our story at a conference.’ Vulcan now has eight analysts covering it and six conferences on its calendar this year. It’s important to pick the right conference to suit the firm’s size and stage of development. Some events, such as Arch’s conferences, are designed only for small and micro-caps. ‘Once a company gets really large, we no longer offer the best value for them,’ explains De la Roche. The WSAF event can serve as a springboard for small caps but has also had GE and Nokia attend. According to Moyer, the IPAA events sometimes have companies attend that are already being covered by 20 or 30 analysts. ‘Independent conferences, where there isn’t the lure of investment banking business involved, are a different experience for companies,’ comments Steve Chizzik, executive vice president of UK-based Equity Communications. ‘Most of the companies that present at the big mainstream conferences are there because the investment bank sees an opportunity for banking business. At independent events, companies are there to present their story, with no ties or expectations.’ ■ July 2007 31

Listings IR magazine

n the good old days, multiple listings were something of a no-brainer: massive upside with minimal downside. The only quandary was deciding which pools of capital – New York, London, continental Europe – to tap. Not so today. ‘Raising capital is now a privilege rather than a right,’ says Anthony Moro, head of emerging markets’ depositary receipts (DRs) at the Bank of New York Mellon (BONY Mellon). ‘Gone are the days when emerging market firms can go on the road with a 25-year-old investment banker and a tiny prospectus.’ But it’s not just the downturn that has affected the listings market. Regulations have also had a notable impact. First, the SEC made it easier for US listed firms to de-list by amending the so-called Hotel California clause. Secondly, the regulator went on to amend SEC 12G, enabling depositary banks to set up unsponsored American DR programs. BONY Mellon recently disclosed that it had issued $1 bn in unsponsored depositary receipts during the first quarter of 2009, leading to hundreds of new over-the-counter ADRs. The unsponsored issue has not been without controversy, however, and while the depositary banks say they are just responding to investor demand for non-US securities, some companies have expressed irritation at not being consulted.

of a variety of analysts, hedge fund managers and financial editors. Just four to eight companies present at any event, with only one company presenting at a time. The cost per company is $6,250. The IPAA boasts its own independent events, which cost $3,750 each for companies. ‘Ours is a neutral conference and all our members can attend; it’s not by invitation only,’ explains Moyer. ‘Whoever registers before we’re sold out can present – that’s the big selling point. We also market the event to the entire buy and sell-side community.’ Buy-side and sell-side pros attend for free while other attendees, including corporate executives, have to pay.

As well as the hundreds of unsponsored DR programs, some firms have moved their secondary listings from the NYSE to OTC in order to save on costly regulatory compliance. Firms such as BASF are also said to be getting 76 percent of the liquidity they were previously getting on the NYSE. OTC QX, the premium platform offered by OTC Pink Sheets, has seen 12 new listings so far in 2009, giving it a total of 59 issuers. German chip maker Infineon Technologies was one company to recently make the move. It de-listed from the NYSE to concentrate on its Frankfurt listing while maintaining a Level 1 ADR security on OTC QX. ‘Some people were declaring the demise of the DR but we are now seeing bigger firms with bigger programs and stronger IR teams moving to the OTC, and it doesn’t seem to have harmed

them,’ Gallagher says. ‘The only downside is that some funds are not allowed to invest in OTC firms.’ ‘There has been a huge movement to the OTC markets from firms that no longer want to be SECcompliant,’ adds Andrew Kyzyk, head of business development at Pink OTC Markets. ‘Firms such as Imperial Tobacco and Air France have found the cost of being SEC-registered runs into millions of dollars.’

Retaining liquidity Gallagher concedes that some firms could be reassessing their multiple listings in the current climate. ‘Obviously, I am a big supporter of DRs but it has to make sense for the company,’ she observes. ‘If it is unable to tell its equity story in the market where the security is listed, we might see this happening.’ But smaller companies with less well-known brands may have to remain on the established exchanges, regardless of the compliance cost, in order to retain liquidity. ‘The more liquid and regulated you are in the new world order, the more benefit there will be when the market picks up,’ Moro points out. ‘Large firms on the US stock exchanges will do well and London will always have a role because of Russia, but for the fringe markets things could be different.’ n June 2009 47

SecTor focuS IR magazine

IR magazine SecTor focuS

‘The gold bugs are still out there. Everyone is still bullish about gold’s long-term prospects’ pleted an analysis of MOSERS, the Missouri state employees’ pension fund, which has 3 percent of its assets in commodities, including gold. ‘Initially, the board didn’t really understand the concept,’ she recalls. ‘It had visions of truckloads of bullion coming to the door.’ After 10 years, however, the investment has more than met MOSERS’ expectations. ‘For a lot of funds, it’s about enhancing trends and smoothing volatility,’ Dempster explains, pointing out that Harvard, whose endowment’s performance has often been the envy of its peers, held up to 17 percent in commodities last year. Hard assets are only part of the story, though. Rather than buying investment gold, some say the answer is investing in gold mining. ‘Costs have risen, but while there is a margin between the market price and the price of production, it’s still profitable,’ Sutherland says. ‘And a lot of the factors that have pushed up the gold price since 2001 remain in place.’ Ellingham agrees. ‘We speak to a lot of people buying gold stocks, and they are hesitating, but a gold equity has more leverage than gold itself, because it’s backed by future gold reserves,’ she says. ‘If you buy an ounce of gold, that’s

By Ian WIllIams

Even safe-haven stocks suffering in financial crisis Sector-wide IR effort to underline value proposition Issuers see silver lining in inflation and currency swings


elling gold stocks in today’s financial climate should be as easy as selling water in the Sahara. As the world’s money markets imploded, gold should have headed every cautious portfolio manager’s shopping list. In reality, its price dropped after seven years of steady growth. Colin Sutherland, CEO of Nayarit Gold, a Toronto, Canada-registered exploration company, is trying to get investor attention for his ‘junior’ gold company, which has a concession in the Sierra Madre in Mexico, and he is still puzzled. ‘There have been wild swings in the gold price as a function of the economic environment, but where it’s trading now doesn’t make a lot of sense given that we will probably see even more bailouts from Federal government and the flood of dollars will lead to inflation, a prime indicator for gold to take off,’ he says. Elaine Ellingham, senior vice president for IR at Iamgold, the world’s fourth-largest gold miner, had to identify quickly what was happening. ‘For a while, we couldn’t figure out why the price wasn’t rising and then we realized: gold is something you buy for

a rainy day – and this is the rainy day!’ she notes. With the financial crisis, funds faced with margin calls are liquidating assets, like gold. In that sense, the gold community feels vindicated. Now, in a move that could help IROs in other sectors, gold firms are using this value proposition in investor pitches.

The prospects The World Gold Council, a not-forprofit organization funded by the world’s leading gold companies to promote demand, is almost a collective IR program for the yellow metal and its producers. ‘We explain gold as a portfolio diversifier: how it works in times of financial distress, its performance concerning inflation, which has been a key factor, and how it acts as a hedge against inflation and the dollar,’ says Natalie Dempster, the council’s investment program head. ‘Equities and bonds do badly by comparison.’ Dempster has recently com-

what you get, but if you buy a mining company, it has a cash flow from producing and selling gold and, hopefully, a nice profit margin. For example, we have more than 20 mn ounces that have been defined by drilling, so we have exposure to a far greater amount of future gold.’ Iamgold, with seven operating mines and 3,300 employees producing 1 mn ounces a year, puts its balances where its mouth is: its $300 mn reserves are in bullion as well as cash. ‘Investors who have held gold through this have certainly done a lot better than people who bought indexes, so it has proven to be a better store of value than the equity markets in general,’ Ellingham adds.

Buyers being wary Interestingly, investors in the countries that buy the most physical gold in the Middle East and southern Asia, such as sovereign wealth funds, have not yet shown much sign of buying back up the value chain. Ellingham’s traditional investors are mostly American and Canadian, with some Europeans. ‘Most people who invest in gold stocks are long term, and have been investing for decades, although there has been a tremendous boom in the last seven years or so,’ she says. ‘But I’m sure there are new investors coming up. After all, gold equities are almost a currency diversification.’ With gold, the conquistadores were looking at the wrong end of the continent. Gold investors and miners meet in Toronto, where, Ellingham points out, the exchange has its roots in mining. Even now Toronto Stock Exchange (TSX) and TSX Venture COVER STORY IR magazine Exchange (TSXV) have 1,200 listed mining companies, over a third of them gold, representing 57 percent of the world’s miners. ‘We have the largest concentration of mining analysts anywhere in the world,’ Ellingham

50 February 2009

February 2009 51


Say on pay is a good jumping-off point for engaging shareholders Formats include governance roadshows, surveys and online forums Many institutions simply following proxy adviser recommendations


ay on pay is one of the hot topics for proxy season 2010 and is widely viewed by companies as a valuable springboard for engaging major shareholders. ‘You can use a dialogue on say on pay as an opportunity to convey to shareholders that you are interested in their feedback and want to have an open-door policy,’ explains Arvind Sood, vice president of IR at California-based Amgen. Amgen took the unusual step of asking its shareholders what they thought of its compensation plan last March through a 10-question online survey. Working closely with pension fund TIAA-CREF to design the survey, the company then reached out to its top 30 holders and received a

range of responses. ‘Some said they were pleased our plan is performance-based and our metrics are clear and easily understood,’ reports Sood. ‘There were also some concerns. For instance, some were worried about the disparity in compensation between executives and other employees.’

In this article: ■ ■ ■ ■ ■ ■ ■ ■

■ ■

Chuck Callan, senior vice president of regulatory affairs, Broadridge Arthur Crozier, co-chairman, Innisfree Sylvia Groves, principal, GG Consulting Richard Grubaugh, senior vice president, DF King & Co Kenneth Janke, vice president of IR, Aflac Reid Pearson, managing director, the Altman Group Rachel Posner, senior managing director and general counsel, Georgeson Ron Schneider, vice president of business development, proxy solicitation and meeting services, the Bank of New York Mellon John Siemann, partner, Laurel Hill Advisory Group Arvind Sood, vice president of IR, Amgen

16 December 2009

Cover story IR magazine

IR magazine Cover story 016-020 Cover story.indd 16

Through the

By AdriAn HollidAy


Management quality and reputation now more important Debt repayment a major issue for many IR professionals Tough times could be here for longer than anticipated

Burazin/Getty Images

20 January 2009


alking to investors when the economy is stricken and the word ‘trust’ increasingly seems like a quaint term from a bygone era is a thankless task. The sheer amount of financial and economic distress littering the landscape is unprecedented, as is the speed at which it arrived. So when red ink streams across income statements and your share price is taking bullets from another round of grim economic numbers, how do you manage the company message? What is the point in talking about your company when the market, to all intents and purposes, is simply in no mood to listen? Hold steady, advises an established financial commentator: if an IRO tries to tell any good news in the current environment, he or she just won’t be believed. ‘That news is also in severe danger of being lost in all the bad news,’ she

12/11/09 21:41:42

explains. ‘The message is now about basic survival rather than profitability. It’s a big change, so if you’ve got bad news, then for goodness sake get it out there and out of the way. When everyone is conditioned to hearing bad news, give it. What you don’t want is to be the company still making very public write-offs the following year.’

Consuming loss One IRO doesn’t have much choice about delivering bad news: his company owns a phalanx of global consumer brand names. Its share price, when he talked to IR magazine recently, had plummeted 15 percent. In one day. ‘Today it was down for no particular reason,’ he says. ‘So I speak to brokers to see whether I can get some insight or whether there’s much stock on loan that could indicate shorting. More often than not the brokers will say something not very useful like, There are more sellers than buyers today or People are worried about the recession.’ This IRO is also increasingly conscious that investor time horizons have contracted, and that’s the reality for many. ‘I suppose when I talk to shareholders now there is an element of, Well, I’m willing to talk to anyone who is interested,’ he continues. ‘It’s about maintaining the dialogue.’ Another IRO says he increasingly sees his role as akin to a politician’s – and, like a politician, he is not allowed to say those three simple words: I don’t know. ‘What I can talk about is process,’

he says. ‘When I talk to investors I’ve got to be robust enough to talk about different outcomes. The thing is not to get nailed to a point when they can say, Oh, but you got that price forecast wrong. So I talk about how the business is managed and the range of possible outcomes in the current climate, making it less about crystal-ball gazing. Now, it’s about the contingencies of responding to different circumstances.’

‘When i talk to shareholders now, there is an element of, Well, I’m willing to talk to anyone who is interested’ Peter Morrissey, an associate professor at Boston University College of Communication, has helped many companies deal with major communication issues over the years. He says stand-out companies like Johnson & Johnson, IBM and Coca-Cola have a long history of talking to the Street in good times and bad; they don’t pull up the welcome mat when the market takes fright. He also points out that the current tough environment is especially hard on smaller companies. ‘For early-stage companies and small-cap firms it is very difficult, simply because investors are seeking low or no-risk opportunities,’ Morrissey explains. ‘If there are no revenues, unless you are in a longhorizon type of business like biotech, it is very hard to get the attention of investors. They simply won’t take the risk. The shortage of IPOs is testimony to this.’ Given the overwhelming concern about earnings and cash flow, Bruce Davidson, head of research at Blue Oar Securities, an investment banking advisory operator in London, now urges IROs on roadshows to pay special attention to issues like debt repayment schedules and pension liabilities. ‘What are the repayment schedules?’ he asks. ‘What are their maturity and currency profile and how will debt need to be replaced?’ Of course, pension funds heavily exposed to equities may need large injections of capital, too. January 2009 21

045-047 compass on the map


4:48 pm

Page 45

Compass points IR magazine SECTOR FOCUS

On the


Burnout point BY BEN BLAND

Airline industry faces difficult period Oil-price volatility means hedging losses IR teams stress competitive advantage


hen crude oil prices started to fall after peaking at over $140 a barrel in July last year, it seemed like a rare piece of good news for the troubled airline industry. Dozens of smaller operators had gone bust in the first half of 2008 as the economic slowdown and the credit crunch took their toll, and the outlook was deteriorating by the day. But the dramatic collapse in oil prices caught the industry unawares and left airlines nursing billions of dollars in losses from fuel-hedging strategies that had been put in place right at the top of the market. From Air China to Southwest Airlines, few have been spared, although some of the ailing US airlines were so low on cash they found it difficult to take out significant hedging positions. Merrill Lynch estimated that nine major Asian airlines alone are likely to have racked up losses from fuel hedging of $3.8 bn in 2008, with Merrill analysts Paul Dewberry and Ying Ying Hou also warning that ‘the Asian airline sector faces the deepest and most prolonged downturn since the global recession of 1980-1982.’ Were these losses the result of well-meaning but erroneous predictions or were airlines trying to play the oil market when they should have been hedging out the risk? With airlines taking such a diverse range

of approaches to fuel hedging, it is hard to generalize. But air industry IROs insist they were not gambling. They say the extreme volatility in oil prices made it very difficult for them to get it right, and that they will, in any case, be able to make up many of the paper losses from bad hedges in the real jet-fuel market.

Ian Williams checks up on IR societies in emerging markets


f free markets are spreading across the world, IR must also be flourishing. And where there’s IR – a notoriously lonely job – there must be IR societies. Lynge Blak, ‘full-time but unpaid’ chair of the International Investor Relations Federation (IIRF), says this umbrella organization for the world’s IR societies can help new groups get set up. ‘We have an advisory function to provide for these embryonic societies,’ he explains. ‘The National Investor Relations Institute (Niri) in the US, the UK’s Investor Relations Society (IRS) and the IR societies in Germany, Holland, France and the Nordic countries want to help, but interest is so sporadic, and it is not something we can put our finger on.’ While there’s a lot of contact with some IROs in many emerging markets, Blak says they haven’t found either the opportunity or the willingness to get together. ‘Yet IR magazine holds awards in places like South Africa and eastern Europe, which shows there are communities and some interest,’ he adds. ‘Those awards give most of the IROs a feeling of togetherness, credibility and pride in what they do. [Perhaps] we should use these occasions to suggest setting up societies. Unfortunately, we have not seen it happen that way.’ The most developed interest has been on the fringes of the EU, in eastern and central Europe, Turkey and Cyprus. Blak says there is also a lot going on in Egypt and Israel, ‘but it is very difficult to say whether either country will set up a society and join the IIRF within the next couple of years.’

Accounting for change Dominique Barbarin is senior vice president of IR at Air France-KLM, which slipped into the red in the last quarter of 2008 after notching up a €288 mn ($361 mn) loss from bad bets on fuel. She says the loss was the result of IFRS, which requires firms to report changes in the fair value of financial instruments such as fuel hedges. ‘The volatility of oil prices makes it more efficient to hedge,’ Barbarin explains. ‘The challenge comes when, due to a drop in the oil price, you have to post some financial charges linked to the value of options. It’s an accounting fact, and it’s important to demonstrate that the fundamentals of the group and its strategy remain the same. The main problem is

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IR magazine Cover story

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2 » WPP (UK) This global communications group’s annual report opens with a six-page ‘fast read’, giving investors a nicely condensed version of the lengthy annual report. The rest of the book is organized with simple declarative headers: Who we are, Why we exist, How we’re doing. While it is well written, readers of the long form are bogged down in words. The volume makes it hard to work out how the company is performing today. ‘There’s some self-importance in the tone,’ one judge says. ‘That’s not attractive.’ The holding company does bring itself to life by including reports from each of the directors running an operating brand. WPP also includes a discussion of ‘how we behave’, in which it addresses its carbon footprint and marketing ethics, among other topics, displaying an unusually deep understanding of the firm’s CSR. The report is weaker on its story for the future. ‘It is in the service industry; these are the first budgets to get cut,’ one judge points out. ‘I didn’t get a sense that the company acknowledges that future market risk.’

A time to impress

Does your annual report pass the three-minute test? Anna Snider investigates


t is surely a disappointment to IROs that investors spend so little time reading the annual report. The rule of thumb is that a company has about three minutes to get its investment story across before a reader loses interest. That may even be a generous estimate; the SEC recently convened a working group to study whether investors pay attention to such reports at all. Two years ago, we made our first attempt to identify companies that got their points across the quickest and most effectively. We reprise that experiment here with a new set of annual reports, ranking them on their ability to communicate a three-minute investment story.

22 September 2008

1 » Land securities (UK) The 2008 annual report for a UK real estate investment trust is the favorite of four out of five judges. One even gives it a perfect score, the only 10 in the contest. Most striking is the sober essay from the chairman outlining what the correction in the property market means for the company. ‘The chairman’s message dealt with the troubled housing market head on, which was welcome,’ one judge says. It also appeals to another judge: ‘It takes the most important person in the company and positions him very well.’ The designers use contrasting handwritten arrows and marks to help the reader along. The notation makes it easy to scan the report, but there are many opportunities to go deeper. ‘It’s similar to WPP offering a six-minute read, but this is smarter,’ notes one judge.

3 » Johnson & Johnson (Us) The healthcare company’s report is readable and well edited, in a magazine style. In a quick glance, ‘you get a sense of how the products change lives,’ one judge says. ‘It’s quite a compelling story, what the company does for the world.’ The pleasingly short book is

very strong on CSR – for example, detailing four years of information on its water use and waste streams. Interestingly, Johnson & Johnson also includes data on the percentage of its employees who smoke or have high blood pressure. ‘That really impressed me,’ comments one judge. ‘Here’s a company that thinks about wider performance issues.’ The report does lack a table of contents, however, and one judge would like more design elements to signal a shift in topics.

4 » Barclays (UK) The British financial services firm presents a massive 300-page report, but it is well introduced so readers get a good picture of the company in the first 10 pages. The firm doesn’t ignore current market

turbulence, outlines exact profit goals and specifically discusses its outlook for 2008. It also defines its performance metrics in a way an entry-level investor can understand. Overall, the judges find it convincing, clear on risk and the best from the banking sector.

5 » Berkshire Hathaway (Us) Warren Buffett’s annual report is all about his letter to shareholders. It is candid and engaging, but presented on plain pages in a manner duller than any other. Buffett’s brilliance as an investor makes him impossible to ignore, but the style wouldn’t work for anyone else. The consensus is that the book would benefit from some visuals, hierarchy to the content and more context. ‘The comparison between

6 » Wienerberger (Austria) The Viennese brick maker’s report is the least conventional. It opens with a series of photographs of meals abandoned and office plants withering, meant to show how busy staff members have been working toward profits. While a gimmick, it works to deliver the message that this is ‘a hard-working, hard-driving company,’ one judge says. ‘You have confidence that it will continue to push itself.’ Panelists fault the report on length, however. There are pages of remuneration and governance details that seem to cover ‘some good stuff struggling to get out,’ as one judge notes. Wienerberger compensates with some nice annotation running alongside dense blocks of text. But it also fails to situate itself in its sector: ‘Is this an obscure Austrian company or a global No 1?’ one judge asks.

September 2008 23

Best practice

How they do it at

Aeroplan A top-flight IRO from a big Canadian bank joins a unique spin-off weeks before the IPO. Ian Williams investigates


hen Aeroplan spun off from ACE Aviation, Air Canada’s holding company, IRO Trish Moran and CEO Rupert Duchesne had to explain how the company could make money from handling frequent flier miles for an airline that had been on the verge of crash-landing not long before. Because Aeroplan was going public as an income trust, they also had to explain to foreign investors how this peculiarly Canadian structure worked. Then, shortly after the IPO, Moran and Duchesne also had to contend with a looming government decree to remove many of the fiscal privileges that made investing in income trusts so attractive. Moran confesses it took ‘a lot of handholding’ with investors south of the border, where Canadian news is as scarce as penguins at the North Pole.


IR magazine

MAY 2006

Six months after a vastly oversubscribed IPO and with the government’s tax issue resolved satisfactorily, Moran and Duchesne could declare their mission accomplished. Not least among their achievements was winning best IPO at the IR Magazine Canada Awards on January 26. In fact, the valuation their endeavors have given Aeroplan has made the company the biggest part of ACE, so the frequent flier plan seems to have proven more commercially successful than actually flying the planes. The achievement was all the more laudable in that it was – for Moran in particular – something of a scramble. ‘You need someone like me...’ With ten years of investor relations under her belt, Moran was senior manager of IR at TD Bank Financial Group when she met Duchesne in August 2004. Inspired by the rumors that Aeroplan was about to take off, she told him: ‘You probably need someone like me.’ Duchesne agreed, and what’s more, remembered. In April 2005 he called Moran and asked her to start immediately. She stubbornly insisted on giving a week’s notice and taking a week off. ‘I’m glad I did,’ she reminisces, since her first day set the pace for the next six months by including a dawn flight to

MARCH 2006

IR magazine


Sell Side IR magazine

IR magazine Sell Side





Corporate access teams decimated by cutbacks Bankers predict loss of service for European firms Smaller players look to take market share


orporate access teams across Europe have been slashed as banks look to cut costs wherever they can. Some have seen head-count reductions of 50 percent or more. As a result, it seems likely European issuers will experience a drop in service. ‘In some respects it’s almost a complete exit out of the area, which for me is dismaying,’ says the head of corporate access at one US bank. ‘I think it’s bad for the industry – and it’s bad for European corporates.’ Corporate access teams appeared in continental Europe several years ago, offering issuers free IR support. They were modeled on UK-style corporate broking teams and supported themselves through

Market developMent IR magazine

commissions from the buy side. Corporate access services include shareholder identification and targeting, organizing roadshows, gathering investor feedback and the provision of a day-to-day point of contact for market insight. With numbers down at most institutions, however, teams have had to change the way they operate. Instead of putting in face time with clients to build trust and pitch new ideas, brokers are stuck in the office manning the phones and dealing with roadshows that have already been organized. ‘We’ve been adversely affected by recent headcount cuts,’ says the banker. ‘There are now fewer people covering more companies than I would ideally like. It’s a shame because companies were getting used to the ‘gold standard’ service UK companies typically experience from their brokers. In time, I think corporates will see an impact on the service they get.’

to its initiative has been ‘phenomenal’, suggesting there is a lack of information flowing to issuers. In addition, some smaller conferences are falling by the wayside. Oliver Schmidt, head of IR at German insurer Allianz, notes that certain banks have stopped organizing specialist events that take place in more remote parts of the world. ‘I do not think this is due to less demand from investors – in times like this there is usually more demand,’ he says. ‘And costs are fairly limited. The biggest effort

‘Companies were getting used to the ‘gold standard’

Cracks appearing Laura Howard, head of the corporate access practice at VMA Group, a UK-based IR recruitment company, agrees the golden period of corporate access for continental firms may be over. ‘In these difficult times we have witnessed the investment banks significantly reduce their corporate access offering,’ she says. ‘This should indicate that the level of service given to European corporates cannot possibly be on the same level as it was two years ago.’ All the big banks have been affected, some more so than others. Citi saw the biggest cutbacks and now has just one person working full time servicing issuers in its corporate access department. Morgan Stanley, one of the pioneers of the corporate access model, has also seen numbers fall dramatically. Teams that ranged from six to 12 staff a couple of years ago now stand between one and five, and this could decrease further. IR magazine questioned banks and issuers across Europe and found some anecdotal evidence of a drop-off in service. One financial institution has ramped up its email output, sending out several hundred morning briefings each day to European clients. Many corporate access teams used to provide this kind of service. But the bank claims the response

service UK companies typically experience from their brokers’ goes into the organization but there is no longer the capacity to organize some of these events.’ Companies also complain about the loss of established contacts in the corporate access industry, a result of the high staff turnover affecting the sell side in general. It all comes at an awkward time for IROs as they gear up to take management on the road following the announcement of full-year results. Most companies canvassed by IR magazine, however, report business as usual with their brokers, although many have

24 March 2009

IR magazine Market developMent

March 2009 25

the Ridingwave

Interest abroad 50 Foreign direct investment in Brazil


$ bn




One year since Brazil went investment grade


Impact of upgrade spiked by credit crunch 0

Stock market outperforming other venues


n a region renowned for its defaulters, Brazil has done rather well of late. The country hasn’t formally run out of cash since the 1980s, while others in South America, like Ecuador, are still playing cat and mouse with international investors. This led to Standard & Poor’s, the credit ratings agency, upgrading Brazil’s foreign debt to investment grade status in April 2008, which commentators predicted would boost interest in the country’s issuers. Fitch, another ratings agency, followed with its own investment grade rating a month later. Two investment ratings meant a wider range of international investors, including some big US pension funds, would be able to pour money into the country’s stock market. The ratings also gave the country an overall credibility boost on the international stage, prompting Bovespa, Brazil’s benchmark index, to hit record highs. Everyone knows what actually happened next, however: the financial crisis entered its second and decisive phase. Brazil, like every other country in the world, saw its stock market collapse. It ended 2008 down 41 percent. All this means it is pretty tough to gauge the impact of the investment grade ratings, which – at time of writing – Brazil maintains. Risk premiums

1999 2000






on government and corporate debt should have fallen after the upgrades; instead they soared. The credit crunch has distorted a lot of the data, according to Ricardo Leoni, capital markets superintendent at the Brazilian unit of Santander, the Spanish bank.

Comparable strength But when you compare Brazil’s performance to those of its peers, in both developed and emerging markets, it doesn’t look too bad. During the first months of 2009, the MSCI Brazil Index easily outperformed the MSCI EAFE Index, a benchmark for non-US stocks (see Market performance, opposite). Bigger firms have also enjoyed the ongoing corporate bond bonanza: Petrobras, the stateowned oil giant, issued 10-year bonds worth $1.5 bn in February 2009 in a sale that Reuters says was three times oversubscribed.

From this evidence it is clear Brazil is coming through the crisis well and remains Jan 2009 attractive to foreign investors. ‘When you look at day-to-day research from the investor side and the equity side, it’s clear the perception of Brazil has changed dramatically,’ comments Evandro Pereira, head of Latin American capital markets for UBS Pactual.

Canada Spain


According to proxy voting agency Manifest, AGM turnout in Spain is among the highest in Europe. But if Spanish firms want to encourage participation from investors outside Spain they will need to be faster in circulating meeting documents prior to the meeting. ‘The key thing will be the production and communication of documents in English in advance of the meeting,’ says Iain Richards, head of corporate governance at global insurance group Aviva. ‘There are some countries where you don’t get the report and accounts until after the meeting, and Spain was particularly bad on this last year.’

Many are expecting higher abstentions on director reelections, and companies such as Barclays and UK retailer Marks & Spencer have taken the step of putting all their directors up for reelection at the AGM in an attempt to appease investors. This year will see equity-raising issues become paramount, with many firms desperately seeking new capital. Expect investors to be paying close attention. ‘It’s inevitable there will be dilution and issuers and advisers need to be careful in these areas,’ notes Iain Richards, head of corporate governance at global insurance group Aviva. ‘Suggestions from the sell side that you can ignore the rights of existing shareholders are just plain wrong.’ As investors’ frustration increases, Richards think companies could see increasing opposition on remuneration votes. ‘If companies ignore their investors, we could see more instances like building firm Bellway in January, when a majority of shareholders voted against its remuneration report,’ he warns. Bellway had planned to pay out its executive bonuses despite substantial share price falls. The vote was the first defeat of its kind in the UK since 2003.

germany ‘Voting participation in the US may increase if there are further resolutions offering opportunities for investors to vote on issues such as say-on-pay. Other key resolutions include proxy access, the ability to remove directors, and the separation of chairman and CEO,’ says John Garbutt, director and global head of corporate governance at Halbis Capital Management, part of HSBC Global Asset Management. As several firms embark on an option exchange plan, paying close attention to the guidelines produced by proxy advisory firms will be key to getting shareholder approval. Advisers say plans will have to be a value-for-value transfer in order to be endorsed, and experts speculate that a significant number of issuers are unlikely to get the support of the proxy advisory firms on this issue, something that will force companies to engage with their major shareholders directly.

30 March 2009


greece In Greece investors can’t vote by proxy and shareblocking still exists, making it a frustrating market. ‘Greece can be problem,’ says Michelle Edkins of Governance for Owners. ‘Companies often don’t announce the name and details of those standing for the board until the day of the meeting.’


Market performance, January 1-March 20, 2009 140,000 MSCI Brazil Index MSCI EAFE Index


110,000 100,000 Feb 2009 90,000

March 2009

80,000 70,000

Jan 2009

Feb 2009

March 2009 Source:

May 2009 43

IR magazine Proxy voting

United States



Going strong

42 May 2009

Proxy voting IR magazine

In Canada – as elsewhere – pressure has mounted for executives to forgo their bonuses. Gord Nixon, the chief executive of Royal Bank of Canada, made headline news when he handed back his C$5 mn ($4 mn) bonus in early February. ‘The major banks released their proxy circulars recently and, in almost all instances, the CEOs gave up their bonuses,’ says Stephen Griggs, managing director of the Canadian Coalition for Good Governance. Interestingly, and in contrast to other markets, the government has not mooted plans for regulation of executive compensation. ‘The option exchange plan has not made its way to Canada and institutional investors there have said any exchange of this nature would be unacceptable,’ Griggs adds.



And Brazil’s banks have managed to keep their heads above water, while many in other countries have sunk without trace or needed emergency resuscitation. Earlier this year Banco Itaú and Unibanco, which are merging to create Brazil’s largest private sector bank, together surpassed the market capitalization of Bank of America and Citi combined. Furthermore, 2008 set a new record for foreign direct investment (see Interest abroad, above).

‘But this is not necessarily a consequence of the investment grade status. On the contrary, I think the investment grade status just confirmed something the market was already pricing in. ‘You can see that in the performance of the Brazilian currency since the start of 2009. It’s relatively stable compared with what has happened to other currencies around the world, like the British pound or even the euro. Also, from an investor perception point of view, I think everyone gives credit to Brazil for what it has done in the last 10 years in terms of solving its most important problems related to its balance of payments.’ Of course, nowhere is out of the woods yet. Global markets have mostly stalled or fallen back since the start of the year; so far, Brazil is one of the exceptions. By March, S&P had placed around a quarter of sovereign-rated countries on negative outlook. But the country is relatively well placed to ride out the economic downturn, a fact reflected by its ratings upgrades last year. After all, upgrades are a consequence of investment that has already occurred, not a cause of it, notes Paulo Vieira da Cunha, a former director at Brazil’s central bank who is now head of emerging markets research at Tandem Global Partners in New York. n

Swiss firms have not always ingratiated themselves with their shareholders. This year, however, the tide is changing as several major companies have agreed to allow shareholder votes on executive remuneration. Nestlé, UBS and Credit Suisse have all agreed to an advisory vote on management remuneration that, although not binding, does signal a change in attitude toward investors. The changes are not across the board, however, and two other firms asked by investors to introduce a say-on-pay measure for shareholders – engineering group ABB and pharmaceutical company Novartis – have refused to introduce the measure. ‘Shareholders have been expounding the concept of clawbacks,’ explains Michelle Edkins, managing director of Governance for Owner’s governance and engagement services. ‘The new rewards system at UBS, the socalled bonus and malus (reward or penalize) plan, presents the concept neatly.’

The introduction of Germany’s Risk Limitation Act should increase participation at AGMs. In practice, however, legal experts don’t expect much to change. The prevalence of bearer shares means it is difficult to identify shareholders in the German market and this opaqueness makes the proxy voting chain more protracted than elsewhere. By improving the transparency of share registers, the legislation has the potential to increase communication and investor participation. The act allows firms to suspend the voting or dividend rights of investors that don’t disclose their holdings but, as yet, no blue-chip company has taken advantage of the law. Siemens, which had its AGM in January, was one of the first big firms that could have used the law change. ‘It would be a very time-consuming process,’ comments Tina Luderer from Siemen’s IR department. Roger Kiem, a partner at global law firm Shearman & Sterling, doesn’t expect much to alter. ‘The majority of blue chips have taken the view that it is too complicated and the disadvantages are too high,’ he says.

March 2009 31

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A Cross Border publication

A Cross Border publication



my back••• The close relationship between business and politics

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A Cross Border publication

Flit street

A Conservative new look

Are you reading all about it?

Why are politicians so obsessed with branding?

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October 2006 ● Issue 12

A Cross Border publication

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Are companies overreacting to blogs and online articles?

Covers: my own artwork, or art directed photography and illustration

Internal communications

Internal communications


moment a whisper of a merger appears in the financial press. Good internal communications is what makes the difference between them being excited about the future, and booking a trip to the recruitment consultants. ‘M&A activity is driven purely on financial grounds,’ warns Peter Christopherson, global marketing director of reputation management specialists Echo Research. ‘Often there is a failure to conduct enough due diligence about the culture of the company that is to be created. But a shared culture is so important.’ To outsiders, the process of a takeover or merger looks deceptively simple. The directors get together with some bankers and lawyers, pay huge fees, sign a bit of paper and suddenly two entirely disparate entities become one. If there are shareholders, they might get a say in the matter, but employees do not. So while directors need to look entirely calm about the process, gliding above the water as elegantly as a swan, internal communicators need to be frantically paddling underneath, just to keep the process afloat.

match made in heaven or hell

Talking to the hands

Rosie Murray-West considers the importance of keeping staff members informed throughout a merger process under legal obligations not to say very much internally or externally until everything is signed, sealed and delivered. But if company A and company B make a mistake at the altar, the consequences can be considerably more far-reaching than a couple of thrown pots and pans followed by a decree nisi. A botched merger can result in thousands of people leaving their jobs and millions of pounds of shareholder value destroyed in a matter of months. Just consider the recent announcement from German car giant Daimler, which is currently selling its ill-fated


s the Hollywood actress Shelley Winters once said: ‘All marriages are happy – it’s the living together afterwards that causes all the problems.’ Winters was not talking about corporate mergers and acquisitions (M&A), although she might as well have been. After all, two firms that decide to spend the rest of their lives together probably have more need of marriage guidance than even the most ill-suited of human couples. Their corporate cultures might be diametrically opposed; they are often different nationalities. And their union, which might have been unwelcome to one of the parties, takes place under a media spotlight that would have Kate Middleton running straight to the Press Complaints Commission. Yet despite all this pressure, the companies are often 027-029 innovations glaxo 14


4:32 PM

U S a c q u i s it i o n, D e t r o it-b a s e d Chrysler. Analysts have placed a price tag of $5 bn-$7 bn (£2.5 bn-£3.5 bn) on the troubled car maker; it cost Daimler in excess of $35 bn in 1998. Getting a merger or takeover right is a big deal and, with every day bringing new rumours of mega-transactions, the issue is becoming increasingly important. But there are many more people than just the directors to consider during the merger process. All the employees in both companies will want to know exactly what is going to happen to them from the first

Abi Signorelli, head of internal communications at Virgin Media, knows just what it is like to try to inform colleagues during a merger situation. The company was recently formed from NTL, and Virgin Mobile, and had 18,000 employees around the world who needed to be kept informed about developments. Getting the internal message right was key to the outside perception of the merger, according to Signorelli. ‘One of the worst scenarios is having a workforce that’s uninformed and unengaged – this immediately translates through to our customers,’ she explains. ‘It is vital to be up-front, open and honest. That’s the only way to encourage trust among our people.’ Ruth Colling, business psychologist at consultancy Nicholson McBride, agrees that engendering trust among employees is a key part of getting a merger to work. Even when there are aspects of a merger that cannot yet be talked about for legal reasons, she says employees will understand – as long as the lines of communication are kept open. ‘If people have the sense that you are telling them everything you can, they are usually very understanding,’ she points out. ‘It is about trust and belief: if they trust and believe you, they will be much more accepting.’ Keeping silent about the changes is not an option, Colling adds. ‘Even if you are not communicating, there will

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May 2007 CorpComms


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wi thou s PR

s r e i t fron GlaxoSmithKline is asking its American sales force to promote products and the

corporate message. Andrew Cave investigates


ou are in a controversial industry that affects hundreds of millions of people. Communicating to them all seems an impossible task. Wouldn’t it be great if you could use an army of thousands to disseminate the corporate message – and even better if there was a ready-made battalion whose members were in daily touch with industry decision-makers? What if such a resource already exists within your workforce? If you’re a huge global

company, why can’t you enlist the help of colleagues in other parts of the business? It’s a pipe dream for public relations departments with tight budgets and stretched manpower, but it’s also a political impossibility. There are far too many departmental barriers and age-old demarcation boundaries that prevent such a workforce being drafted in. Or are there? At pharmaceuticals giant GlaxoSmithKline (GSK), this scenario has become a reality for the 8,000-strong American sales force. Representatives have been tasked with acting as public relations ambassadors to raise the reputation of the healthcare industry, and they made 15,000 presentations to an estimated 1.8 mn people last year.


April 2006 CorpComms



Helen Dunne talks to the young and dynamic head of corporate communications at online bank Egg

Egg-citing at the W

hen Emma Byrne, director of corporate communications at online bank Egg, read the thousandth headline containing the word ‘cracking’, she sent a bottle of Champagne to the hapless reporter. Five years into the job, Byrne, 35, has scrambled her way through every possible Egg-related pun but, with typical good humour, remains amused by the game. ‘The name got us talked about and symbolises our fresh approach to banking,’ she explains. Headhunted from Weber Shandwick five years ago, Byrne was excited by the prospect of Egg. ‘The obfuscation and lack of transparency in the UK banking market is outrageous,’ she says. ‘It can be made so much easier. The prospect of helping that process won me over.’ Egg, which is 79 percent owned by Prudential, launched with a credit card offering 0 percent interest on purchases and balance transfers. It was revolutionary. Today 83 providers offer similar deals. ‘It was quite difficult to explain initially,’ she admits. A series of groundbreaking humorous TV adverts


CorpComms August/September 2005


helped; some even assumed cult status among students. Egg is passionate about educating customers on improving their financial circumstances, working closely with consumer groups and the influential Treasury Select Committee. It was the bank’s evidence to the committee that precipitated a change in how credit card companies disclose their charges. Byrne has always enjoyed championing underdogs. More than ten years ago, she persuaded businesses to invest in trouble-torn Belfast; later she took on former client Ikea ‘because it meant everybody could afford a stylish home.’ Today Egg has more than 3 mn customers, and Byrne and her five-man team have won almost every award available. Shortly after joining, she fired Egg’s external agencies, earning the sobriquet ‘Bin ‘em Byrne’. ‘My view is that I won’t hire somebody to answer the phone and pass a message on to the chief executive,’ she explains. ‘We all need to understand the business inside out, and represent that to the media. An external PR can rarely get that close and keep up with the pace of change.’ Byrne – a member of the executive committee, just below board level – reports directly to CEO Paul Gratton. Rumours persist that Prudential will sell Egg. ‘About 2,500 employees work for us; we have to be open and frank with them and as reassuring as possible, as well as working within the reality of City regulations,’ Byrne says. ‘The last 18 months have been challenging.’ And egg-citing! �

‘The obfuscation and lack of transparency in the UK banking market is outrageous. It can be made so much easier’ August/September 2005 CorpComms


January 2009


Issue 33

A Hardy Media publication

Coping with the squeeze Corporate communicators face tighter budgets and tough decisions

Lead feature

Media relations

With doom and gloom top of the media agenda, what happens to the positive news?

Crystal ball gazing

Industry professionals offer their predictions for 2009

Lead feature

Awards 2008

Celebrate the winners' triumphs at the CorpComms Awards 2008

Content- driven

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E i t h n e Tr e a n o r i n v e s t i g a t e s t h e d a w n o f t h e Audi TV channel and what it could mean for the future of brand communication


s consumers, we long for the dawn of ad-free TV. As communicators, we’d love more ad breaks and product placement and better response from our viewers. At the same time, segmentation and specialisation of channels on digital TV are shaping TV viewing habits, especially as viewers can select specific categories such as news, history or entertainment with the help of the electronic programme guide (EPG). Enter the Audi channel, the UK’s first branded TV channel devoted exclusively to... you guessed it, Audi automobiles. The channel features documentary-style programming, coverage of motor racing in Le Mans and celebrity interviews. The channel is categorised as ‘self-promotional’ by the

UK regulatory body Ofcom, a classification available to any business that meets minimal standards. The beautiful thing for Audi is that it is found on the EPG under the entertainment category, rather than under the shopping or specialty categories. ‘We’re moving from conventional advertising to more content-driven entertainment,’ says Gary Savage, marketing director for the Audi channel. ‘The entertainment aspect is what’s key; it helps us engage much better with our audience.’ Fast lane

Photography: Jatinder Marwaha Car image courtesy of Audi

Despite this breakthrough, Audi has no intention of abandoning conventional advertising, says Savage. The company prides itself on its creative advertising campaigns for its cars and Savage sees the addition of its TV channel as a more contemporary form of getting the message out. ‘We’re future-proofing ourselves,’ he explains. ‘We now have access to the world 24/7 and conventional advertising is no longer good enough.’ The Audi channel is currently available only in the UK and Ireland, but the online version is available worldwide. ‘Already, I’m getting calls from journalists in China and in Japan who have seen this on the internet,’ Savage continues. ‘We have more than 700,000 people visiting our web site, so the word is spreading; it’s working.’ The Audi brand is clearly a focus in every programme, be it celebrity 017-019 charities-slavery



3:05 pm

interviews, Formula 1 coverage or Audi technology. There’s an Audi theme throughout and one cannot help but notice the slick design and the spacious car interior as sports celebrities unload training gear and equipment. But then this is all part of the Audi message. Not everyone is convinced about the future of brand TV, however. Theresa Wise, a media partner at Accenture, questions the cost-effectiveness of such a network. ‘I’m surprised it got the go-ahead and I’m sure when the marketing budget is stretched, it’ll be the first thing to go,’ she states. Wise says TV is not always the best way to reach people. ‘It may be good to get the emotional power of the brand across, but you need a lot of people to watch it before it translates into sales.’ Furthermore, she adds, companies should stick to what they’re good at. ‘A car business should not be tying its money up in programming, transmission capacity, scheduling and all the technical elements of a TV channel,’ she points out. ‘These are dead dollars if you’re looking for a promotional medium.’ Audi is not alone in its confidence in TV, though. Costas Argyrides is gearing up for the 2006 launch of Greece Cyprus Though this is not a truly commercial brand like Audi, managing director Argyrides is taking advantage of the same self-promotional channel regulation in his attempts to sell travel-related services in both countries. Greece Cyprus will provide documentary-style entertainment about Greece and Cyprus as holiday destinations with the express intent of selling holidays and holiday homes. Argyrides says ‘narrowcasting’ is here to stay. ‘Viewers of specialty channels are conscious consumers who visit the channels with the intention of getting all the relevant information they need before proceeding with a purchase,’ he notes. ‘This is the future of TV.’ Economy ride

In terms of bang for the buck, Audi obviously sees its new TV channel as a winner. ‘It cost about £2 mn to set it up and about £600,000 extra to actually get it on air,’ says Savage. And it’s the content that is the expensive part. ‘If we continued to recycle Page 17

CorpComms December/January 2006

CorpComms December/January 2006



Freedom is the Charities are using the

bicentenary anniversary of the abolition of slavery to highlight how slavery s t i l l e x i s t s t o d a y. R o s i e


Murray-West investigates

history of the slave trade, giving charities a chance to spread their message.


lave trading was formally abolished throughout the British Empire on March 25, 1807, yet today up to 20 mn people worldwide are estimated to be physically enslaved. Hundreds of millions more are slaves to drugs, alcohol or other forms of addiction. But the abolition of slavery was also an early example of how individuals campaigning for change can make an enormous difference, so it is unsurprising that organisations are determined to exploit the bicentenary anniversary to put modern-day slavery on the front page. For charities such as Anti-Slavery International and Oasis Trust, which runs the ‘Stop the traffick’ campaign, an anniversary like this is an opportunity not to be passed up. For months preceding the event – and afterwards – slavery is likely to become a key issue in Parliament and the media, while schools will inevitably want education packs dealing with the

Modern slavery

Although they are not currently a core part of the curriculum in many schools, students may already be aware of William Wilberforce, the lead campaigner to have slave trading abolished; or John Newton, the former slaver who converted to Christianity and then wrote the hymn Amazing grace. However, 2007 is more likely to be the year of Olaudah Equiano, an altogether more politically correct hero: a black former slave who bought his own freedom and campaigned for the practice to be ended. The Church Mission Society (CMS), founded by campaigners who helped abolish slavery, has commissioned a

CorpComms March 2006




BAT’s press relations manager David Betteridge believes in honesty, not smoke screens, as Andrew Cave finds out

Not all smoke and mirrors A

‘We don’t ask anyone to smoke. We just hope that if people are going to smoke, they will choose Lucky Strike rather than Marlboro’ 20


Rob Ettridge,

CorpComms February 2006


Will Cameron

client services

Director, corporate strategy, Waggener Edstrom

director, Red Lorry, Yellow Lorry This year has a rather ominous air about it. With rising unemployment, businesses going under daily and tides of woe coming from across the Atlantic, it could be a rough ride for us all. Written communications will play a big role in managing the effects of the economic and commercial downturn. How people react to what they read will make a difference. The most obvious player here is the press. But businesses too will be sending out signals and managing perceptions through how they communicate – both with their staff and the wider public. Many industries – financial services, airlines, even retail – will need to mitigate any perceptions of greed and self-interest. So proactively communicating in a clear, confident and understanding tone of voice will be an essential tool. There are some crucial pointers for corporate communicators to bear in mind in the coming year. 1) Don’t couch difficult messages in flowery, formal language. If you have unwelcome news to give, say it clearly and simply. Use a human, natural tone of voice when writing and resist the temptation to come over all corporate and bureaucratic. 2) People will place more trust in a company that they think has their best interests in mind and is working hard to overcome challenges, than one that seems faceless and uncaring. 3) Make sure communications sound calm, measured and reassuring. This involves crafting messages so they have the right tone of voice – not distant, patronising or flippant. It may not be the right time to wave the brand flag either, particularly if yours is at the funkier end of the brand spectrum. 4) As much as possible, focus on what has or will be done to overcome difficulties. This is not to say you should hide bad news in a pep talk. It means being open and clear about the challenges ahead while explaining what concrete measures are in place to overcome them. Most of all, remember that you don’t have to be formal to sound serious. In fact, your messages – regardless of what they are – are more likely to be well received if they have a straight-talking and empathetic ring to them.

There is an issue casting its shadow across the media landscape for corporate communications professionals, one that has always been with us but is being brought into stark relief by the shifting economic environment – too many companies chasing too little space in the media. We are entering an era where events – the credit crunch and the drive to the Internet to name but two — are conspiring to significantly reduce available pages in our management teams’ favourite titles. Unfortunately, there is no corresponding reduction in expectations of coverage. The challenge for the corporate communications professional is going to be how to negotiate this less hospitable landscape, to paraphrase Baldrick – It may be time for a cunning plan.

Angie Moxham Chief monkey, 3 Monkeys When the proverbial hits the fan it is human nature to want to batten down the hatches and wait until the fallout has cleared. Our job and biggest challenge this year is to educate our clients to do the absolute opposite. It’s worrying to observe how many high street brands – particularly trusted financial services brands – have reacted to this Great Recession. Rather than take the initiative and demonstrate leadership in testing times, they’ve retreated. Sure, the economic meltdown has created a Rubik’s cube of uncertainty where each day new predictions – typically of yet more doom and gloom – are blazed across the media flaming further panic. But so much of what is happening around us is to do with confidence. And we need to help business and organisational leaders put a stake in the ground to support their customers and help to rally confidence to bring a quicker and less painful resolution to this fine mess we’re in. For me, this isn’t an option. If you care about your employees, your customers and your stakeholders, it’s a must. Organisations should now be fully engaged in proactive corporate communications campaigns with more vim and vigour than before September 2008. For those of us old enough to have been around in the early 90s, the last recession taught us that if you trade up your communications activity in trying times you’re far more likely to survive and prosper in the short, medium and long term. 3 Monkeys is running workshops with our corporate clients to allow boards to realise not just the opportunity but the necessity of this. So, colleagues, let’s stick together, united behind the message that this is the year when Fortes fortuna adiuvat.

Colin Byrne, This year will prove both a challenge and an opportunity for corporate PR professionals. The challenges of the current economic downturn across all sectors are obvious and already being felt. For many in-house communicators the pressures are

January 2009

The bar for PR generated stories finding homes in the mainstream media is being set much higher, so we need to find new ways of creating compelling content, while still being able to address the key issues at the heart of our corporate agendas. The ‘cunning plan’ is this — work together with a competitor to establish a critical mass to a story that may help get it ‘over the bar’. The difficulty with this plan is that this is not the way we are used to working. We are going to have to consider some new practices and approaches, potentially using third party intermediaries in ways not previously envisaged. Will we start using social media to share our challenges, common interests and communications objectives, rather than just seeing it as another channel for coverage?

on budgets and to produce better ROI evidence than the PR industry has previously focussed on. Business leaders’ mantras should be When the going gets tough, the tough get communicating. Now, more than ever, companies and organisations need clear communications strategies with internal and external stakeholders. When it comes to communications simply focusing on the online or offline aspects of PR alone will no longer suffice. If we are to ride out the wave of the economic storm, we must continue to create and influence advocates by seamlessly merging both these elements to create effective inline communications which not only engage the consumer but that also bring your message to life. As firms are forced to downsize and cut costs due to the current economic crisis,

they must ensure that they retain and continue to develop their top talent and, therefore, internal communications will be a massive area of focus this year. As well as this, with the political race up to the 2010 (or potentially 2009) general election, public affairs and the thorough understanding of policies rather than just the personalities of the main parties will be increasingly significant. Companies will need to focus more directly on their public affairs outreach if they are to maintain their success this year. So corporate communications professionals are pivotal, but will need to seize that opportunity within their organisations at a time when the instinct of some business leaders will be more ‘rabbit in the headlights’ than bold, clear communications.



Digital media

campaign 2.0 trail T i m H u m a n tak e s a l ook at th e r ol e n e w m e di a ar e se t to pl ay i n Lon don ’s u p- com i n g m ay or al e l e cti on


he candidates for the forthcoming London mayoral election have been looking Stateside for some tips on how to revamp their political campaigns and engage an already uninterested electorate; one in five Londoners has not registered to vote. Ever since US Senator George Allen was posted on YouTube making racist remarks in 2006, an indiscretion that cost him his Virginia seat, digital media have been recognised as powerful forces in American politics. The current US primaries offer a good example why. Positive and negative video clips of the presidential candidates are flooding YouTube, and some have appeared to swing public opinion at vital moments. Now London is set to witness its own blast of digital electioneering. This May’s mayoral contest will see far greater use of digital media than the last election four years ago. Internet use in the UK has rocketed in the interim, especially the use of social networking sites, and all the leading candidates have built new media into their campaign strategies. The UK’s strict laws on political advertising have also encouraged greater use of the web. ‘Each candidate has access to only a limited number of party political broadcasts, which

CorpComms February 2008


Chief executive, Europe, Weber Shandwick

On the


February 2006 CorpComms

There are many questions still to be resolved; not least, will this be the year when we start collaborating rather than competing? We may find that a shared voice is better than no voice at all.

Digital media

Image: Reuters/Dylan Martinez


comment’ was usually the most anyone would get. The old answer would have been to go away and talk to the lawyers.’ Now, Betteridge says media audits show that journalists like dealing with BAT and find it open and honest – something that could hardly be said for some of the reporters who attended a London press conference last year to unveil snus, a smokeless tobacco that the user places under the top lip. ‘It’s illegal to sell it in the UK,’ explains Betteridge. ‘But we had to show people what it was. We left all the tins of snus out but asked the journalists not to take them. Needless to say, by the time the presentation had finished, every single tin had gone.’ The South African launch proved even livelier, with one journalist apparently asking whether using the product could inhibit oral sex. ‘Yes, I’m aware of the questions that were asked, but I’m not going to go into details,’ Betteridge says coyly. Maybe it’s another Eastern Electricity moment. �


negative story is still a story, and British American Tobacco (BAT) press relations manager David Betteridge knows what it’s like to be on the end of one. ‘When I was group media relations manager for Eastern Electricity, the ‘fat cat’ issue for chief executives of privatised utilities was at its height and everything they did was under the microscope,’ he recalls. ‘I remember taking a call from the News of the World. It wanted to talk to the chief executive and I said he was on holiday. I know, said the reporter. I’m at his hotel and he’s in the room next door. I don’t want to go into the details now but it was the next day’s splash. It was one of those situations where I could do absolutely nothing.’ Normally, however, Betteridge believes there is plenty companies can do to defend their reputations when there are hot issues to handle. ‘This job is more interesting because of its controversial nature,’ he says. ‘I really wouldn’t want to work for an organisation that didn’t do anything terribly interesting.’ He doesn’t smoke himself but adds, ‘I really don’t have an issue with it. We don’t ask anyone to smoke. We just hope that if people are going to smoke they will choose Lucky Strike rather than Marlboro.’ Betteridge, 38, worked as a reporter on the Evening Gazette in Colchester and a small public relations agency before joining Eastern, followed by BAT in 2000. ‘BAT was the only FTSE 100 company without a proper press office,’ he says. ‘The tobacco industry was hardly open with its communications – ‘no

makes the internet a valuable resource,’ explains Matthew McGregor, a London-based campaign organiser for the Labour Party and head of London Mayor Ken Livingstone’s online campaign. Personal connections

Livingstone, who has held the mayoral post since its creation in 2000, is using the web to connect on a more personal level with the city’s voters. ‘The day after the first mayoral television debate on January 10, we emailed out a clip of Ken reviewing the event and invited people to submit their own questions,’ says McGregor. ‘If the question you wanted to ask wasn’t brought up by the audience, Ken can answer it online. It gives people the chance to interact with the campaign and the candidate in a way they previously might not have been able to.’ Conservative hopeful Boris Johnson is also keen to get intimate with the electorate. ‘We are developing a unique ‘Boris for the Boroughs’ interactive feature for the website,’ comments a spokesperson from the Tory campaign. ‘People will be able to air their views, share what they love and hate about their borough, and identify pinch-points – and all of this on a borough-by-borough level.’ In addition, both Johnson and Livingstone have set up Facebook profiles, as have the Liberal Democrat candidate Brian Paddick and Green Party hopeful Siân Berry. Paddick has also set up an account with Twitter, an online communications network that allows users to be updated on his canvassing activities in real time.

running, tasked with galvanising the London electorate, which has proved apathetic about mayoral politics in the past; turnout in 2004 was just 37 percent. Again, personalising the experience is high on the agenda. ‘ T here are lots of interactive features on the website,’ says Emma Cassidy, PR officer at London Elects. ‘Users can upload photos of their boroughs onto the site. When people refer to London they tend to think of Tower Bridge or the Houses of Parliament, but London is lots of dif-

Importance of being earnest

The candidates are learning to exploit new media in the same way advertisers have done in recent years: to put across a candid, direct message that – hopefully – creates a buzz around a brand or, in this case, a politician. With this in mind, the mayoral hopefuls are also keen to interact with preexisting online groups in an effort to give their message added authenticity. ‘There are students on Facebook running support groups, and I think helping them out is more effective than trying to manage everything top down,’ notes McGregor. ‘It’s better to engage with people who are doing things for themselves.’ London Elects, the independent organisation overseeing the election, has been influenced by social media, too. A new website is up and

February 2008




Digital clippings

Try something new today

ClipSearch, a web-based archive of newspaper clippings available on either a subscription or pay-as-you-go basis, has been launched by the Newspaper Licensing Agency. Drawing on a database of more than 100 national and regional UK newspapers, ClipSearch is the only service to deliver articles in image format so that users can view them as they appeared in print. Electronic cuttings are available on ClipSearch three days after they appeared in publication, and include coverage dating back to 2006. Users can search by company name, journalist, topic or keyword which allows for in-depth analysis. ClipSearch is viewed as a complementary service to the

Keep marketing Four in ten companies will increase expenditure on public relations over the next 12 months while 58.9 per cent will boost spending on websites and 18.2 per cent will be boosting direct marketing, according to a new survey by research company Shape the Future. The results are at odds with past history when marketing and PR are among the first disciplines to be cut back during difficult economic times. Indeed, almost 12 per cent of companies surveyed cited websites as the most important marketing tool over the next 12 months, while 25 per cent viewed websites as the pre-eminent means. Just over 36 per cent of companies surveyed plan to increase their overall marketing budgets in the next 12 months, while half planned no change. Just nine per cent confirmed plans to cut back, while a similar amount were still undecided. However, the survey also revealed that businesses in the South East were more likely to reduce their marketing spend.


core offerings of media monitoring companies, but allows their clients an effective means of accessing and researching archive material. The NLA claims that ClipSearch enhances information management, enabling organisations and their PR agencies to research their own and their competitors’ media profiles and to research journalists’ specific areas of interest, enabling them to launch highly targeted campaigns based on the results. Initially sold through media monitoring and press clippings agencies, from January ClipSearch will be available directly from websites, including those of UK newspapers. The NLA will also launch a direct service next year.

Online productivity boost A leading think tank has urged bosses not to stop using social network sites, such as Facebook and Bebo, arguing that building relationships and links with colleagues and customers may actually benefit the business. The report, by Demos, argues that social networking sites may actually help with productivity, innovation and democratic working. But author Peter Bradwell agrees there should be practical guidelines to limit non-work usage. He said: ‘Bans on Facebook or YouTube are almost impossible to enforce; firms may as well try to put a time limit on the numbers of minutes allowed each day for gossiping. The answer is not to close staff access to social network platforms, nor is it investing blindly in collaborative platforms. We argue we need to understand how, once we accept the implications of social networks, we can manage the new challenges and trade-offs.’

Forward booking Internal qualifications The Internal Communication Certificate, a six month course aimed at those in the first years of their career in internal communications, has been launched by the Chartered Institute of Public Relations. It is the only internal communication qualification awarded by a Chartered body, and is designed to provide students with a solid grounding in all the key concepts, techniques and theories, including organisational culture. The first CIPR Internal Communications Certificate launches in January, and will be run by the PR Academy.

Jay O’Connor, managing director of global consultancy Racepoint Group Europe, has been elected president of the Chartered Institute of Public Relations for 2010. She will serve alongside next year’s president Kevin Taylor. O’Connor, who has worked in public relations for more than 14 years, is currently a CIPR board member. She also chairs the Education & Professional Standards Committee and working group on Chartered Practitioner Status.

November/December 2008

Supermarket J Sainsbury has become the latest company to offer nationally recognised qualifications to its 150,000 employees, setting an ambitious five-year target for 25 per cent all staff to have a nationally recognised qualification. It now offers a Level 1 numeracy or literacy qualification, which is equivalent to one GCSE at Grade D, supports employees who wish to brush up on their maths and English skills. Training for Level 1 qualifications is available on a confidential basis and can be undertaken without the involvement of line managers or peers. Staff receive password details allowing them to logo onto the web based training at any time and proceed at their own pace. A dedicated online tutor is available to every student who enrols. The first 2,000 employees to complete the Level 1 qualification will receive a £50 voucher. Sainsbury’s is also the first retailer to offer every colleague the opportunity to achieve a NVQ Level 2 qualification, equivalent to five GCSEs at grade C or above. This qualification recognises ‘on the job’ training, meaning that compulsory training programmes such as stock control, visual merchandising and health and training, will count towards the final marks.

Product placement ITV and Pact, the trade body for independent producers, have agreed a code of conduct should proposals for product placement during television shows win government approval. The joint code suggests that a logo could appear on the screen to indicate the presence of a commercial brand. It also states that a programme’s producer would decide how products are incorporated into the content, as long as they can be justified editorially, and ensure that they do not feature too prominently. Product placement opportunities would first be identified after a script has been finalised by the production team. A non-editorial team would then approach brands about the opportunity and agree commercial terms. Culture secretary Andy Burnham launched a consultation into product placement in July.



Lang ad Nov 2008

Contents Nov e m b e r / D e c e m b e r 2 0 0 8


‘It doesn’t matter about the realities, the newspapers are ready to attack any perceived excess by a high street bank’

Is s u e 3 2

Special featureS




A targeted approach


Nina Montagu-Smith considers the different ways for


companies to distribute press releases and information to the world’s media Cover story


Back to the seventies?

Me aNd My ageNCy


7 8


relations strategy into place as Helen Dunne discovers






people about finance


Predicting the future Jon Ashworth considers the value of research polls in

‘We are all dependent on eight inches of topsoil. It isn’t just dirt, it is our lives, even if we don’t know it yet’

Down to

earth 20

CorpComms July/August 2006

25 years’ experience in award-winning business, consumer, internal and investor communications.

November/december 2008


You get the reputation you deserve Professional writers Compelling copy Memorable messages More at

the CoMMuNiCator


the wake of the American elections 2

Well grounded

Rupert Younger, director of the Oxford University Centre for Corporate Reputation, argues that some companies fail to take CSR seriously

in Uganda to launch a £13.5m programme to educate


A clutterfree approach

persoNal view

Lessons in finance Barclays is using the lessons learned in a small village


A round up of agency news

A perfect professional

Helen Dunne meets John Grounds, director of communications at the NSPCC

All in the wording discovers, word-of-mouth marketing is causing a stir

Page 20

annual reports than Lang Communications

A new identity for Barclaycard to better suit its dynamic business model

It may still be in its infancy but, as Caroline Poynton




its importance



rebraNdiNg foCus

Speaking one’s mind wonders if a lack of hard hitting dialogue has diminished

020-022 Profile Maynard


Sarah Hanratty, head of communications at National Lottery, offers her views on the qualities needed by a corporate communicator


Andrew Clark considers the role of the corporate blog and


Page 1

My top 10 tips

communication strategy

communications team had to put an emergency media


ageNCy Matters

Helen Dunne examines how companies are reviewing their

When the Cutty Sark went up in flames, its

Friends in need The Sick Kids Friends Foundation discusses its relationship with Edinburgh-based design agency Tayburn


With the return of the government as a major shareholder,


The latest developments


A youthful approach to communications 3



In-jean-ious Rosie Murray-West meets Ros Freeborn, head of communications at Jeans for Genes, and learns about her quest to ‘denimise’ the world

‘Jeans for Genes is incredibly popular with teachers’


or Ros Freeborn, every day is dress-down Friday; she is the head of communications at Jeans for Genes, the charity that raises money for genetic disease research by organising the ultimate ‘mufti day’. As we speak, just before the annual Jeans for Genes day on October 5, Freeborn’s life is becoming increasingly manic. ‘It is like being a sheepdog,’ she says. ‘My job is to keep everything going in the same direction. There are only nine of us here, with so much to do.’ Jeans for Genes is a collaboration between four genetic disease charities, including Great Ormond Street Hospital, and last year it raised £3 mn for research and help for affected families. This year, Freeborn explains, she is encouraging the public to ‘get denimised’ and pay a couple of pounds for the privilege of wearing jeans to work. She has been working on a massive marketing campaign, and has spent the week doing trial jeans fittings on a number of somewhat unresponsive subjects. ‘We are putting jeans on iconic statues around the country to advertise the day,’ she explains, because this provides visual images that are easy to sell to newspapers, magazines and even radio stations. This year, the statue of the trader in London’s Walbrook Street will be sporting a natty pair of jeans held up by braces, while in Coventry, the famously naked Lady Godiva will be clothed for the first time in a long denim cloak. ‘We have to keep the message very simple, but it needs to be refreshed every year,’ Freeborn says. ‘It is looking good for this year. These things are visually quite quirky.’ For Jeans for Genes, the communications and marketing challenge is clear. The charity must compete with other wellknown causes for money and attention from schools and workplaces. Genetic diseases are harder to explain than other diseases, such as cancer, and yet they are surprisingly common. ‘There is a huge spectrum of genetic disease, everything from a squint or a cleft lip to something like cystic fibrosis, for which there is no known cure,’ points out Freeborn. ‘It is very

hard to put the message across about every facet of genetic disease, and yet it affects one in every 33 babies.’

Target practice Part of the marketing strategy is to target specific employees in workplaces around the country. ‘There are always those who make sure the collecting tin is taken round and the money collected,’ Freeborn explains. The charity sends out packs to these people in August to explain the theme of the next Jeans for Genes day, and takes adverts in national newspapers and workplace magazines running up to the day. ‘We ring up and ask whether they have any spare space to slot in our pre-prepared advertisements,’ Freeborn says. ‘That has been very successful.’ The charity’s roots are in the nation’s schools, however, and this is still a massive part of its marketing. Jeans for Genes started over a decade ago when a school in the West Country held a dress-down day to raise funds for a child with a genetic disorder, and the charity has grown from there. ‘Eighty percent of schools are aware of Jeans for Genes, and it is incredibly popular with teachers,’ Freeborn says. This is hardly surprising: unlike some other charitable days, which can be about throwing custard pies at staff, Jeans for Genes has a serious educational

Ph ot og ra ww w.c ph y: ha rle ss

he ar

n. co


CorpComms October 2007


October 2007




Proper English The Lollipop lady has returned to Harrow, after the North West London council replaced seven of the most baffling terms with their more simple and readily recognised versions. Out go school crossing patrollers to be replaced by the more recognisable Lollipop lady (or man), while civil amenity sites are consigned to the renamed rubbish tips. Controlled Parking Zones (CPZs) will now be referred to as permit parking or double yellow lines, while a motorist who infringes the rules will once again be dealt with by a traffic warden rather than a civil

Burgers go green enforcement officer. Streets, parks and pavements will be called just that or even open areas, rather than their fancy name of ‘public realm’ and the baffling ‘multi-agency approach’ has been replaced by ‘different groups working on the same thing’. Councillor Paul Osborn said: ‘Our residents want to hear plain speaking and that’s what we’ll deliver. We are now working to ensure that council terms, which can include all sorts of baffling acronyms, do not get used when we talk to the public.’ Indeed, even talking to the public has been renamed. Stakeholder engagement is now known as ‘asking people what they think’.

Gas mags British Gas has launched a new bi-monthly magazine You which aims to keep 15,000 engineers and call centre staff up to date on news. The magazine replaces Inside, which has been running for two years, and is designed to appeal to busy staff with a bright, eye-catching design and straight-talking, jargon free news. Tony Beresford, designer of You, said that the design takes inspiration from television guides. He explained: ‘TV guides are among the best-selling magazines in the UK and appeal to a wide demographic, covering a broad spectrum of messages from comedy and news tit-bits to in-depth interviews and behind-the-scenes features.’ The staff publication is being produced by London-based creative agency Redhouse Lane. Stephen Chawke, British Gas Services’ Communications Manager, added: ‘Our people remain at the heart of our publication’s agenda and it’s good to see more employee opinions being aired.’ 4

Revitalising PRCA More than half the members of the Public Relations Consultants Association (PRCA) believe it has undergone a radical transformation over the past year. Indeed, eight in ten members surveyed for the PR Leaders’ Panel said the association has changed for the better over the 12 months, with 54 per cent citing a significant improvement. Just over one third of those surveyed said they valued the networking opportunities offered by the PRCA, while 28 per cent said membership gave them credibility with clients. One in five valued the training and services offered by the PRCA, while 36 per cent said that the most valuable aspect of membership was FAPRA, the association’s new business service, which has seen an 85 per cent increase in leads this year.C o v e r s t o r y

October 2008

Bosses unprepared Workers are increasingly concerned about the ability of their bosses to deal with the worsening economic climate, claims new research by Aziz Corporation. Indeed, 81 per cent believe that their bosses lack the experience to cope with a downturn while more than 60 per cent say that just one in ten of the current management held senior positions at the time of the last recession. The research also revealed a widespread perception that business leaders are reluctant to reveal financial problems. Almost three quarters of those surveyed claim that many companies are reluctant to communicate the full extent of the financial downturn they are facing, while 83 per cent believe managers are quick to announce good news but disinclined to release information that may be bad for their firms. Khalid Aziz, chairman of Aziz Corporation, said: ‘In the absence of full information, markets will assume the worst, Companies which refuse to come clean risk a steady and persistent drip of bad news.’

McDonald’s, the fast food chain, has launched a pilot scheme in the West Country to turn its food waste into compost. If the pilot proves successful, McDonald’s could introduce the policy into all its 1,200 restaurants across the UK. The potential amount of waste saved from landfill could reach 90,000 tonnes per year, according to estimates, or enough to fill more than 200 Olympic-sized swimming pools. The pilot involves 12 restaurants in Dorset, which will take waste to a special plant run by New Earth Solutions to be converted into compost for agricultural use in local farms. The restaurants are expected to save 40 tonnes of waste over the fortnight that the pilot runs. The pilot follows a successful scheme in Yorkshire where 11 restaurants sent waste to a recycling facility to be turned into electricity. The Carbon Trust, who audited McDonald’s, said the chain reduced its carbon impact from waste disposal by 54 per cent. Marie-Louise ter Beek, environment manager at McDonald’s UK, said: ‘We are always looking for ways to move closer to our goal of sending zero waste to landfill and the composting trial in Dorset is an important example of this.’

CIPR gives evidence The Chartered Institute of Public Relations has submitted written evidence to an inquiry by the Select Committee on Communications into the 2004 Phillis Review of government communication. The CIPR believes professionalism within government communications has improved in the four years since the review. But it believes training could further raise standards and overcome inconsistencies in communications across departments. As a result, the CIPR is working with the Government Communication Network (GCN) to provide training and continuous professional development support. Government communicators have also been given the opportunity to become members of the CIPR.


An identity crisis Major corporations can overreact in their response to internet blogs and online rivals, turning a minor scuffle into a public debate. Rosie Murray-West reports


CorpComms October 2006

Cover story 5


hen the newspapers talk of a ‘David versus Goliath battle’, we all know whose side we should be on. Ever since the eleventh century BC, when a child defeated a nine-foot giant with five smooth stones in a slingshot, poor old Goliath has suffered from a lot of bad press. His name has become synonymous with big, greedy companies that gang up on the ‘little guys’ – scenarios that can blow up into PR disasters of biblical proportions if they are not handled well. These situations are becoming increasingly common as companies try to tackle the many-headed hydra that is the worldwide web. Executives who previously embraced the internet’s power to sell products or advertising become decidedly less enthusiastic when the so-called social media starts talking about their business. These bloggers, message board contributors and small entrepreneurs can be extremely influential, which is fine when they are saying something good – but they are also almost impossible to control when they have something negative to say, although that does not stop companies from trying. The internet is almost completely self-policing, and it favours the fast, the young and the entrepreneurial. Companies or individuals that deal with any online threat to their brands or trademarks using a standard legal

October 2006 CorpComms


Motivational speaking

Motivational speaking

Manic speech


N i n a M o nt a g u- S m i th lo o k s at the role of motiv a t io na l sp e a k ing in p roviding a jump-start to dis illus io n e d e mp lo y e e s


hen directors at Orange realised they were struggling to get employees on the business side to feel inspired at work, they decided it was time to take action. ‘We have quite disparate teams in the marketing area on the business side at Orange,’ says Jo Cooper, talent manager at the mobile phone group. ‘Being on the business side of the group, it can sometimes be hard to bring across the life of the Orange brand.’ So last year Orange decided to hold an off-site, day-long meeting for its marketing teams – some 50 people – in a bid to gee them up. It brought in Kevin Duncan, whose company Expert Advice offers management, pitching and other business-improving advice to companies, to inject some inspiration. Duncan encouraged the teams to ask questions of their managers and collaborate with each other. ‘He told them they have the right to talk about things like meetings, for example, and to ask whether they attend too many,’ says Cooper. ‘More generally, he emphasised the importance of talking to each other, and understanding that everyone is going through the same things.’

‘If you have 30 things to do on a checklist, the chances are that you will not have asked why you need to do 28 of them,’ Duncan explains. ‘This is about filtering out the crap, and being able to ask your boss why you have to do something. This is beneficial for workers as well as for companies, because companies will then be less likely to become involved in lots of pointless programmes.’ Duncan’s contention is that this wasting of time and energy within companies – sitting in endless meetings, getting engaged in pointless programmes – is what demotivates people to the extent that they don’t even feel able to challenge the decisions that put them there in the first place. ‘I think many firms have no idea how to manage people,’ says Duncan, who offers motivational coaching in sessions ranging from a one-off halfhour talk with a large group to a series of 10 weekly one-on-one sessions. According to Cooper, Duncan’s speech and interaction with members of Orange’s marketing teams, encouraging them to feel their input is important, really affected the employees. ‘I

would say it completely changed the mood of the day, and the afternoon was much more collaborative,’ she says. ‘I think people really did bring that collaborative attitude back to work with them afterwards, too.’ Culture shock

Many motivational coaches will tell you the same thing – office culture can be a real downer when it comes to exciting and enthusing employees. There is a wide range of activities that lay claim to the title ‘motivational coaching’, from bringing in a celebrity or sports star for a pep talk to tailoring three-month-long training courses for your staff. It is also possible to give your staff an away day (or weekend) learning how to build rafts and helping each other through assault courses. HBOS recently sent members of its technology team – which is spread out in different offices across the UK – on a treasure hunt in Fife, Scotland in Mini Coopers and helicopters. The staff came back feeling invigorated and saying they had benefited from the teamwork with colleagues they usually only spoke to on the phone. If you really want to make your staff rush into the office bubbling with enthusiasm, however, a more integrated approach might be better. Using a one-off approach to enthuse staff is a waste of time, says Nick Simmonds, motivation coach from communications consultancy Think Feel Know. ‘If you do a one-off Daley Thompson-style speech, you might as well burn your money,’ he adds. ‘I always think it is ironic that management brings in some celebrity to gee up the staff. Surely it should be management that does this?’ Motivational methods

A motivation coach will first establish exactly which problems a company wishes to solve, and determine what the company wishes to achieve. He or she will then offer group sessions, individual coaching, one-off workshops, or a course of sessions. Simmonds’ approach is to teach clients the importance of tuning the cultural side of the business to the company’s commercial aims. ‘Any business that focuses purely on commercial outcome will suffer from cultural problems like lack of organisation and cohesion,’ he says. ‘Likewise, any organisation that focuses only on building a good culture will suffer from a lack of commercial outcomes.’ One way to marry the two is to devise key performance indicators (KPIs) for the cultural side of your business as well

CSR CorpComms March 2008

March 2008



E v e r y y e a r, t h o u s a n d s of knitters produce woolly hats for Innocent Drinks bottles. Helen Dunne finds out why


hoppers passing the chilled drinks cabinet of any J Sainsbury store can be forgiven if they do a double take, because perched atop bottles of Innocent Drinks they’ll find a range of small woollen hats. A cranberr y and raspberr y smoothie, for example, may be modelling a striped bobble hat, while the mango and passion fruit might be wearing a ladybird-style bonnet. The likelihood is that no two bottles will look the same, because every single knitted

December/January 2008





sually if a chap tells you he has something of interest in his pocket, it is best to make a quick getaway. But when the gentleman in question is Jim Boyd, director of corporate affairs at transport operator Go-Ahead, you can relax. Boyd, 42, carries the company’s crisis management booklet in his pocket at all times. The booklet is a detailed list of potential crises, ranging from minor derailments to major crashes or terrorist attacks, and the appropriate responses from the parent group and its operating companies. There are five different levels, of which red is the most serious, and each response is incredibly detailed. ‘It is our way of identifying risk,’ explains Boyd. ‘There is a series of scenarios and details of how senior management should respond.’ Many crises can be handled by the individual operating companies, which include Oxford Bus Company, the Go West bus service, Southern and Southeastern rail services, Meteor Parking and Aviance UK, which employs almost 5,000 ground staff at 17 airports. ‘The booklet explains at what point they should get in touch with our group,’ says Boyd. ‘We have people working in completely different sectors but there is a uniform response. We have worked through all the possible scenarios and provided a cohesive and high-quality response to each situation.’

Go ahead,

take the train



Helen Dunne meets Jim Boyd, director of corporate affairs at transport group Go-Ahead



CorpComms March 2007

The road to risk management Thankfully for Boyd and Go-Ahead, the group has not experienced a red alert since the booklet was produced. But a bus owned by the company was blown up by an IRA terrorist on Aldwych, close to Waterloo Bridge, in February 1996. And Boyd is mindful of the recent National Express coach disaster in which two people died and many others were injured. He concedes there is a ‘complex interaction’ between the company and the 800 mn passenger journeys undertaken every year. ‘Since I joined two years ago, there have been some medium crises – events that can have a reputational impact – but there has not been a major incident with multiple fatalities, for which I am extremely grateful,’ Boyd says. ‘Even so, we are always conscious that vehicles are much more powerful than the individuals who drive them and there are always issues outside our control, such as weather conditions.’ Chief executive Keith Ludeman instigated the crisis management booklet shortly after he joined Go-Ahead. ‘It is a focused and structured approach to crisis management,’ Boyd explains. It was compiled with the aid of Mike Seymour,

international director for crisis and issues management at Edelman, who audited all potential risks Go-Ahead faced. ‘We assigned weights to current concerns, and mapped out the risks associated with them,’ Boyd continues. ‘We found different sectors within the group had different perceptions of risk. We looked at low risk and high-risk scenarios and discussed which qualified as crises.’ In short, if the 37 bus, a 24-hour service between Peckham and Putney, is running 40 minutes late, it might be a disaster for granny waiting in the pouring rain at the bus stop, but it is not a crisis for the company. There is certainly a reputational risk, however. ‘If a bus is running five minutes late, the only way to deal with it is by explaining why to the passenger,’ says Boyd. ‘All we can do is apologise hugely.’ While Go-Ahead employs 25,000 people, the head office at Croydon in Surrey has a staff of just three. ‘The group’s philosophy is that local transport is best delivered locally,’ says Boyd. ‘They are local brands and should communicate directly with passengers. We are here to give support, in both a strategic and consultancy capacity, and our role is to make sure we transfer best practice across the group.’ For example, the managing directors of the operating companies are frequently ‘on the platform or the train or at the bus stop’ to meet passengers. ‘They have to think like a passenger,’ explains Boyd. ‘We put in a huge amount of work engaging with members of staff about the brand and what it seeks to do.’ The group also spends time with local MPs, councillors and community groups discussing transport requirements

March 2007




PRCA link up

Online engagement vital Orange fans online

The Public Relations Consultants Association, the PRCA, has announced a five-year partnership with Hollis PR, a division of Wilmington Group, which also owns the Press Gazette and Benn’s Media. The strategic partnership will result in Wilmington working with the PRCA on its annual awards, national conference and to develop a new recruitment service. The PRCA also intends to draw on Wilmington’s experience to introduce its own e-learning programme and PR diplomas. The association has already grown its membership by 25 per cent this year as a direct consequence of extending its range of services. Francis Ingham, PRCA director general, said: ‘This strategic partnership will enable us to move to the next level, further improving our service offering and growing our membership.’

Telecommunications company Orange was the overall winner in the summer Kaizo Advocacy Index, which measures the impact of online word-ofmouth recommendations on 20 major brands across four sectors. The index, compiled by word-of-mouth PR agency Kaizo, found that Orange, Danone and Symbian were winners in the mobile, food and software categories respectively. But Ryanair and British Airways both scored poorly, highlighting how global corporate news can impact the online recommendations for a brand. In the past, Del Monte and Heinz have both suffered from negative online coverage as a result of labour issues in America. Rhodri Harries, managing director of Kaizo, added: ‘Brands need to be more active online to ensure the balance remains positive, especially when they are faced with significant industry issues.’ Kaizo advises organisations that Advocacy Index scores should be considered in relation to competitors’ scores rather than in isolation, as some sectors, such as cars, have broad Word of Mouth appeal and higher average ratings than niche sectors such as software.

A greenprint for retailers Retailer Morrisons is to open Britain’s greenest supermarket in Kidderminster this month in a development that it hopes will provide a ‘greenprint’ for stores in the future. Energy efficient combined heat and power systems will generate part of the store’s on-site electricity while waste by-products will provide heat in an effort to reduce carbon emissions by 120 tonnes a year.

The store, which has received a BREEM Excellent rating, also has solar panels, intelligent lighting control systems to minimise the use of artificial lights, while controls will be fitted to the refrigeration equipment to reduce power consumption. Chris Evenson, development director at Morrisons, said: ‘We have taken into account everything from energy management and insulation, to building products, construction methods and new cycle ways and care of the local otter colony.’ A rain water harvesting system has been installed on the roof to collect rain water for use in toilet flushing.

From AMEC to Berlin AMEC, the International Association for Measurement and Evaluation of Communications, has announced that its first European summit on measurement will be held in Berlin. The summit, which will take place between June 10 and 12 next year, is being organised with the US Institute for Public Relations. Barry Leggetter, executive director of AMEC, believes that holding the event outside the UK ‘is an important message to give to our fast growing international membership’ which stretches from Australia to Macedonia. Full registration details have yet to be announced, but for further information contact Leggetter on or +44 1268 412414.

September 2008

Web-ucational idea Technology skills, closely followed by creativity, being open to new ideas and communication skills are cited by students as the main benefits from using social networking sites, such as MySpace and Facebook, according to new academic research. The University of Minnesota also found that low income students are as technologically proficient as their high income counterparts, rejecting the results of previous surveys. The analysis of students, aged 16 to 18, over six months found that 94 per cent used the Internet, 82 per cent went online at home and 77 per cent had a profile on a social networking site. Christine Greenhow, a researcher at the university’s College of Education and Human Development, concluded

that the web offers ‘tremendous educational potential’. She added: ‘Students are developing a positive attitude towards using technology systems, editing and customising content and thinking about online design and layout.’ Greenhow believes the study’s results have implications for universities and other educational facilities, who now have an opportunity to support what students are learning on the web. She said: ‘By understanding how students may be positively using these networking technologies in their daily lives and where the as yet unrecognised educational opportunities are, we can help make schools even more relevant, connected and meaningful to kids.’ 5




In Camden


Helen Dunne meets Ashley Wilcox, head of corporate communications at Camden Council, and learns how to connect with a diverse stakeholder group on a shoestring Photography:

015-019 Internal Comms


12:08 PM


September 2008

Internal communications

You’re fired! You’re rubbish! Bullying at work can be a problem, but a successful internal comms programme can help. Karen Higginbottom reports

amden, the north London borough that spans the elegance of Primrose Hill, bustling Covent Garden to the grittiness of the infamous Somers Town estate, has had more than its share of headlines in recent months. There have been the bizarre antics of resident Amy Winehouse, the fire at the famous market and the tragic stories of teenage knife attacks, but for the borough’s 220,000 residents, Ashley Wilcox is the man making sure they are informed. Wilcox is corporate communications manager for Camden, working with a team of 40, to inform and educate the local population about the services offered by their local borough. ‘It is a difficult challenge,’ says Wilcox. ‘We provide between 600 and 700 different services and we try to ensure that resident are aware of these. There is no big sell. We just tell them that these are great services and they can make their lives easier. But the communications budget is very low. We have just 19p per week per resident, or 0.3 per cent of the council budget.’ Shortly after Wilcox joined in 2005, a coalition between the Liberal Democrats and Conservatives unseated the incumbent Labour council, who had held power for 36 years, promising to take politics out of local government. It signalled the end of council newspaper Camden Living, which was filled with quotes from local politicians, and gave Wilcox a blank canvas to start again – without any interference from councillors. He produced a business case to justify the publication of another newspaper, Your Camden, which instead focusses on the borough’s services and residents’ real life experiences. When concerns about knife crime rose, for example, the newspaper carried a story of a former violent petty criminal who had turned his life around.

R e a di ng g o od n e ws

‘We do spend a lot of time researching and evaluating our work,’ says Wilcox. ‘We distribute the magazine to 95,000 homes in the borough and to pick up points, such as Sainsbury’s, libraries and community centres. Our surveys show that 90,000 residents read our newspaper, which is much higher than the readership of the local newspapers.’ Keeping residents educated has a huge impact on their satisfaction levels. In the year to 2005, 68 per cent of residents perceived Camden Council to be doing a good job. Today, the level is nearer to 76 per cent against a London borough average of 67 per cent. But Wilcox’s approach is about more than just a newspaper. He initiated an A-Z Handy Guide to council services, which costs a hefty 33p per copy to produce. When residents were polled on the cost and whether they viewed the publication as valuable, 90 per cent said yes. ‘We are very strategic in our approach,’ explains Wilcox. ‘We have a three year strategy and service plan and everything we do works to this, otherwise we would all go off and do lots of different things. Our strategy is aligned to the corporate plan. Our key objective is to keep residents informed about services and to increase their understanding of what we do.’ The situation is complicated by the demographics of Camden, which is recognised as having the largest social deprivation gap of any London borough. Residents speak a total of 108 different languages. ‘It is a transient population and very diverse. We have a very big Somali and

Page 15


o you suffer under a rude and surly boss in the workplace? Does your manager think that Alan Sugar’s aggressive style in The Apprentice is the only way to motivate and inspire staff? If the answer is a resounding yes, then you’re not alone. A survey of more than 1,100 employees by workplace communications consultancy Colette Hill Associates shows that discourtesy and rudeness are common in the workplace, particularly when it comes to abuses of power by more senior figures. The research, entitled ‘Business behaving badly’, reveals that nearly half

July/August 2006 CorpComms



Brands that fail to embrace and engage in online consumer dialogues are likely to be among those most severely affected by the current economic slowdown. Research by e-consultancy Logan Tod and online PR consultancy immediate future revealed that 64 per cent of those surveyed will reduce their spending as a result of the economic climate. However, 54 per cent claimed that their online spending would either not be affected or would actually increase. Online spending now accounts for 17p in every pound spent in the UK. But six in ten respondents claimed they are now more likely to consult reviews written by other web shoppers before purchasing their goods. Katy Howell, managing director of immediate future, said the research highlighted the importance of online interaction between consumers. She added: ‘Whether it is with blogs, comparison sites or user reviews, brands need to understand and engage with social media to survive the expected economic downturn.’ The research also revealed that 43 per cent of respondents aged over 55, many of whom have paid off their mortgages, and 37 per cent of those aged between 16-24 do not plan to change their spending habits.




Public relations

Public relations


camel at a meeting with the GMB’s general secretary. The union claimed that without the demonstration, the meeting – at which the union raised the issue of salaries and job cuts – would not have taken place.


In the spotlight

Buffini may have been surprised by the level of public vitriol, given that private equity has operated in the same way for decades. But as deals have grown larger, and household names have become targets of buyouts, the public has inevitably grown more interested. The GMB also fuelled debate about the tax status of the industry, writing to more than 100 MPs seeking support for a campaign calling for better transparency and a review of tax laws that it perceived as unfairly benefiting privately owned companies. Until the current credit crunch, the UK had become Europe’s private equity hothouse. While the overall value of buyouts by private equity groups in Europe totalled £130 bn last year, spread across 775 deals, 40 percent took place in the UK. Household names such as supermarket giant J Sainsbury were targeted (unsuccessfully), while high street stalwart Alliance Boots was taken private in an £11 bn buyout that triggered a £6.5 mn windfall for former CEO Richard Baker, plus huge cash payments for other directors. The payments were labelled ‘obscene and unacceptable’ by the GMB. The deal also marked the first FTSE 100 company ever to have been successfully taken private in a private equity deal, raising the possibility that other seemingly untouchable companies could follow. But the industr y’s traditionally private nature was mistaken for something more sinister. ‘One of the joys of private ownership is privacy,’ explains Richard Carpenter, development director of consultants Radley Yeldar. ‘Privately owned companies don’t have to reveal financial information 035-037 peroni to the public on an annual basis. But while the buyout of Alliance Boots meant a switch in ownership, the company still employed thousands of staff with whom it had previously communicated publicly. As larger companies were taken private, something had to change.’ Every day, the City pages of newspapers were filled with details of potential private equity deals and articles highlighting the anomaly that meant private equit y

N i n a M o nt a g u- S m i th e x p lains how a came l m a y h a v e b e e n r e s ponsible for great e r o p e n n e s s a n d t r a nsparency within t he p r iv a t e e q uit y in dustry ast month Permira, Britain’s biggest private equity firm, published its annual review. It was a glossy 78-page publication full of information on Permira’s portfolio – which includes investments as diverse as high street retailer New Look, gaming company Gala Coral and over-50s financial services group Saga – and an opening statement from chairman Damon Buffini. Indeed, it looked much like any other company’s annual review, but its publication represented a dramatic change for the notoriously secretive industry, because Permira is the first private equity company in the country to lift the lid on its inner workings. This move, which other private equity companies are poised to follow, comes after a public backlash against the industry that many participants firmly believe was fuelled by a lack of

Getting the hump

Two years ago, the GMB union paraded a camel outside Buffini’s local church as a protest against job cuts in two Permira-owned businesses: roadside recovery firm the AA and frozen foods group Birds Eye. Leaflets citing the biblical maxim that it is easier for a camel to pass through the eye of a needle than for a rich man to enter the kingdom of heaven were distributed. The demonstration highlighted the fact that more than 3,000 jobs had been shed from the AA’s 10,000-strong workforce since Permira had taken control two years earlier, while 500 jobs had been lost at Birds Eye following the closure of a factory in Hull. It focused public attention on the asset-stripping nature of some private equity deals at a time when the industry employs more than one fifth of all workers in the private sector. The following year, Buffini was presented with a stuffed

CorpComms May 2008

Making changes

The industry – begrudgingly, some would say – responded to this new image challenge. Last year, Sir David Walker, former chairman of Morgan Stanley International and a former executive director of the Bank of England, was asked by the industry’s lobby group, the British Private Equity and Vent ure Capital Association (BVCA), to come up with some new guidelines for reporting. Shortly afterwards, the spotlight on the industry was intensified when the Tr eas u r y S ele c t C ommit tee decided to conduct its own enquiry into private equity, summoning industry leaders to its sessions at the House of Commons for a series of heated showdowns in the full glare of the public eye. A further round of hearings is scheduled for later this year. If the negative attention of the unions was not enough to persuade some private equity groups of the need to change their communications strategy, the shock of the Treasury Select Committee ordeal certainly had the desired effect. In November, published 5/5/06 9:53 Lord AM Walker Page 35 guidelines requiring more transparent reporting by qualifying private equity groups and their portfolio companies. The BVCA responded by setting up a working committee to monitor the effectiveness of the guidelines as they are adopted. Any portfolio company that has

May 2008

015-019 Internal Comms


12:11 PM




Page 19

Internal communications

Culture clash

Who dictates the working culture? Cooper believes that senior management is responsible for setting the tone and culture of an organisation. ‘The top people in the organisation must say that the following behaviours are unacceptable, and it’s up to them to reinforce this by their own good behaviour.’ Aziz believes that managers are often promoted on the basis of their technical ability but lack the softer skills such as ‘emotional intelligence’ needed to motivate and communicate with staff. ‘People who fail to appreciate the importance of emotional intelligence will struggle to get the best out of their employees,’ he says. One area where the clearest signs of rudeness are displayed is at meetings. The research revealed that four out of ten employees reported that junior staff were ignored in meetings. Other complaints raised included people trying to dominate meetings, cancellations at the last minute, people interrupting colleagues, and people checking e-mails or using their mobile phone during meetings. Wright believes that internal comms has a vital role to play in establishing courtesy in the workplace. ‘It also has a coaching role to play in encouraging staff to become more effective communicators,’ she says. Internal communications departments need to be aware that the values of trust and mutual respect mean nothing unless the behaviours underpinning them are brought to life within

H e l e n D u n n e l o o k s a t P e r o n i ’s

the organisation, adds Wright: ‘It’s not about placing values on mouse mats or screensavers within the company.’

take on ‘the sweet life’

Added values

In Wright’s opinion, the companies that are successful at creating a culture of respect and courtesy in the workplace have become so through integrating those values and behaviours into their performance management systems. ‘Unless you put the behaviours in your performance management system and link with some consequences that reinforce the idea that you’re serious about behaviour, it’s just wallpaper.’ But does courtesy matter in the workplace, particularly when it comes to the performance of an organisation? Wright believes that a lack of respect within the workplace has implications for a company’s performance. ‘It has an impact on retention rates; if you don’t have employees who feel valued and who respect each other, you’re not going to provide a high level of customer service,’ she says. Clare Harbord, head of UK communications for power giant E.ON, agrees that rudeness in the workplace can be detrimental to an organisation’s success. ‘I think if you have a disrespectful culture, it undermines teamwork and can have a real impact on motivation as well as stifling creativity within the workforce,’ she says. ‘People are fearful of coming up with ideas.’ ●

Top tips on corporate courtesy ● When it comes to difficult conversations, meet face to face

in private where you won’t be interrupted ● Start a difficult conversation by building a rapport and

establishing common ground. Use collaborative language ● Praise people in the way with which they feel most

comfortable. It may be a private conversation, a formal letter, a casual e-mail copied to a few interested colleagues, or even a full-blown public announcement ● Before you send an e-mail, stop to consider whether you

should be communicating in a different way – for example, face to face or by letter ● Avoid aggression. Treat others as you wish to be treated

and look at situations from both sides


hen Landi Swanepoel walked down the red carpet at the Baftas, was snapped with Mischa Barton at the Elle Style Awards and posed for OK! magazine at the Brits, the attendant paparazzi learned she was the star of the upcoming homage to La Dolce Vita. But what they did not realise was that Swanepoel, a South African-born model-turned-actress, was really the star of one of the most audacious advertising campaigns in years. Swanepoel is recreating the role made famous by Anita Ekberg in Federico Fellini’s cult 1960 film, but this is not a remake in the usual sense of the word. It is a three-minute blackand-white advertisement for Peroni Nastro Azzurro that draws on several iconic scenes from La Dolce Vita and places the beer,

May 2006 CorpComms



Profile July/August 2006 CorpComms



in time saves...

Helen Dunne meets Christina Rebollo, head of PR at uSwitch, and learns about passion and campaigning media


hristina Rebollo is no stranger to switching. Born in Madrid, the 30-year-old head of PR at price comparison website uSwitch spent her early life in a succession of different countries. ‘My father worked for IBM on some of the first internet projects, and we moved every three to four years,’ Rebollo explains. ‘But I moved to the UK 12 years ago to attend London University, and I’ve been here ever since.’ When Rebollo graduated with her degree in computing (to please her father) and French (to satisfy her love of literature), she knew what she didn’t want to do – but not what she did. Her first job was in the marketing department of accountancy giant Deloitte, before joining the credit cards business at Royal Bank of Scotland (RBS). ‘I realised what I liked most about my job at Deloitte was PR,’ Rebollo recalls. ‘RBS was a fantastic opportunity because it was purely PR, and the credit cards business is huge. We used to say that it was bigger than Boots and McDonald’s.’ Such was its importance within the banking group that the cards business had its own autonomous PR team and agency. ‘We were allowed to be creative,’ says Rebollo. ‘But you also spend about 60 percent of your time within a big bank just fighting fires. There are dozens of customer complaints every week that the media ring up about; you are always defending and reacting. It is true crisis management.’ Although Rebollo stayed with RBS for more than four years, she began to feel uncomfortable about the way high street banks operate. ‘At the time there was a lot of public discussion about consumer over-indebtedness and responsible lending,’ she explains. ‘RBS is an incredible organisation that treats staff extremely well, but banks are there to generate as much profit as possible from customers. I needed to do something different


CorpComms November 2007

where I could say what I wanted – call a spade a spade, if necessary – to the benefit of consumers. The job at uSwitch offered me the chance to do the kind of PR very few people are able to do.’



understanding of how this sector operates. Buchan Scott, a partner at private equity firm Duke Street Capital, has stated that much of the negative reaction was due to the industry’s lack of disclosure and its failure to communicate.

Honesty Seeds Photographer: Kantor Jonathan


financiers paid a lower rate of tax than their cleaners. The government finally responded to the g roundswell of negative public opinion by raising the base rate of capital gains tax from 10 percent to 18 percent, partly to force private equity companies to pay more.

Really saying something Rebollo joined in 2005, when uSwitch was already well known for its energy price comparison site and was extending its service into other consumer products, such as personal finance and home phone and broadband offerings. She was its first in-house PR person and, as well as boosting its press coverage and profile, she had to build a team, put processes and systems in place, generate press coverage and achieve her very ambitious targets. ‘Coming from an organisation like RBS, it was like chalk and cheese,’ recalls Rebollo. ‘I wanted uSwitch to have the largest share of voice as an independent commentator in each of the industries where we operated. Today, in energy our closest rival is Ofcom, which is a regulator, and we have raised our game in personal finance, beating our nearest rival,, for the past two years.’ Rebollo now has a team of five – ‘all

‘It’s not enough just to get press coverage and comments in the newspaper; PR has to be there to support the business’

November 2007



CAnAdA SPECIAL CovErAGE – starts page 35

Corporate Secretary issue 75

APRiL 2010

Corporate Secretary

Corporate Secretary


Corporate Secretary A Cross Border publication


A Cross Border publication

CS cover main deck: fight exposed serious flaws in the electronic voting process as millions of ballots were put in jeopardy. What can you do to prevent this from happening at your company? page 00

Proxy season Proxy season SHAKE-UP SHAKE-UP




Will the SEC’s new director disclosure rules make boards better?

 Shareholder rights plans With predatory M&A activity on the rise, companies are reviewing defense strategies page 17

 Interview

stephen Norman discusses 30-plus years as a governance leader page 22

page 12

 International Compensation and engagement targeted in Combined Code review page 26

 Profile ColeTaylor Bank’s corporate secretary and general counsel shares tips on reducing legal expenses page 24

 Legal Lawsuits against non-us issuers are on the rise page 28

ISS U E 67  J U LY /AUGUST 2009

ISS U E 75  AP R I L 2010

 Boardroom Regulatory push for greater board diversity puts pressure on companies to justify their selection process page 21

 Investor activism Dissident shareholder gives a play-by-play account of how it staged a successful rebellion page 40

00 cover.indd 1

18/3/10 17:04:26

Corporate Secretary iSSuE 71


Corporate Secretary 

FeBRuARY 2010

A Cross Border publication

page 12

00 Cover.indd 1

 Legal With fraud on the rise, companies are reviewing compliance and detection programs page 23

I SS U E 73  F EB R UARY 2010

I SS U E 71  DECEM B ER 2009

Rule 452, emerging proxy access, executive compensation and nominee reimbursement are shifting the balance of power – and will let shareholders affect major change on corporate boards

page 35

23/11/09 11:57:39

Corporate Secretary JANuARY 2010

 Proxy Transfer agents may play an increasingly important part in the shareholder communication process page 29  Compliance Can compliance officers be independent if they report to the general counsel?

Repealing the broker vote for director elections was supposed to increase shareholder representation, but it may well do the opposite page 12

page 38

00 Covers.indd 1

Corporate Secretary

Corporate Secretary



 CSR New seC rules may lead to an increase in climate risk-related shareholder resolutions page 19

 Proxy targets Greater advocacy and proxy access join the Society’s list of 2010 targets

ISSue 72

16/7/09 10:22:29

452 N&A?

Companies consider voting alternatives in preparation for the impact of the loss of broker voting page 19

 Conferences Think tank debates proxy plumbing and the shifting sands of D&O liability


Where will lead

 Proxy voting

 Communication Executives need special training for communicating with investors and the media page 30

issue 67

issue 73

A Cross Border publication

Proxy season SURVIVAL gUIDE page 25

 Technology Document management and e-discovery challenges growing rapdily page 31

00 Cover.indd 1

Corporate Secretary

Corporate Secretary


Proxy season 2009 contained more than a few surprises. The governance shake-up sees the profile of activists changing and their focus shifting to ‘vote no’ campaigns page 16


Corporate Secretary issue 74

A Cross Border publication

18/1/10 14:28:31

MARCH 2010

A Cross Border publication


global revolution

Leading the


Corporate Secretary Monthly title for the US governance and compliance industy.

The Corporate Secretary

 CSR Transparency and dialogue can set the record straight, but great CSR programs mean taking real action page 16  Proxy statements

Answering the why – not just the what – is the key to leading practice in proxy disclosure page 20

Magazine Awards once honors in corporate governance – and thrust

 Filing and reporting efficient structure and process are the keys to keeping on top of subsidiary filings page 21

some new names into the spotlight

page 12

I SSU E 74  MAR CH 2010

ISSU E 72  JAN UARY 2010

 Technology Intel sets a new standard for shareholder meetings and proxy voting with virtual application page 25  Best of the best

Cisco and Fluor elevate governance from regulatory consideration to true business function page 36

00 Cover.indd 1

 International staying compliant across various legal jurisdictions is a serious challenge for global companies page 17

again identify the top

17/12/09 12:14:49

 Profile Best Buy’s corporate secretary shares the inside story of her career in governance page 24  Education The seC has formed a new body to help educate shareholders on the importance of proxy voting page 32

00 covers.indd 1

Design, art direction, production.

Shareholder activism has taken off and investors all over the world are fighting for greater influence in the boardroom – but not all activists are the same page 12

23/2/10 12:24:53

Covers: my own artwork, or art directed photography and illustration

Corporate Secretary ISSUE 76

MAY 2010

Corporate Secretary

Corporate Secretary



Corporate Secretary issue 70

A Cross Border publication

First encounters

 Governance Former in-house experts are boosting standards through specialist consultancies page 17

 Recruitment How to develop and maintain healthy board dynamics page 31

 Social networking New communications tools have significant upside – and legal and cultural dangers page 23

 Risk management The pros and cons of having a chief risk officer page 35 What can the SEC’s new cooperation initiative do for you? page 38

 Technology How to deal with human process management page 40

21/4/10 17:26:04

Corporate Secretary OCTOBER 2009


Corporate Secretary A Cross Border publication

SEpTEmBER 2009

Mutually assured destruction  Regulation The Shareholder Bill of Rights is set to permanently change issuer/ shareholder dynamic page 19

page 19

page 22

page 30

 Technology Companies are missing a trick in online communications page 36

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23/9/09 14:36:35

 International

European governments are taking extraordinary measures to ensure board diversity page 22

I SS U E 6 8  SE PTEM B E R 20 09

I SS U E 6 9  OCTOB E R 20 09

 Regulation What are the implications of the SEC’s Regulation FD update?

Many investors see proxy reform as a panacea for corporate woes but proxy access and other changes could result in significant loss of shareholder value page 12

A Cross Border publication


 Disclosure Is reporting of loss disclosure really possible? And, if so, is there any value to investors?  Ratings agencies Regulators review the system of rating corporate securities

page 12

16/10/09 12:15:45

iSSuE 68

A Cross Border publication

Government prosecutors and private litigants are directly targeting individuals. While board members and executives have always been at risk, the general counsel and corporate secretary are now firmly in the crosshairs

 Education Changing liability landscapes push board members to reevaluate directors’ skill sets page 30

00 Cover.indd 1

Corporate Secretary

Corporate Secretary


 Boardroom Regulation and shifting activism are changing the director election landscape page 27

ISS U E 70  NOVE M B E R 2009

ISS U E 76  M AY 2010

 Legal

ISSuE 69

A Cross Border publication

in the line of FIRE

Boards and directors explore unmapped territory as they look for new ways to communicate with shareholders

00 cover.indd 1

NovemBeR 2009

 Crisis management Having the right response plan allows companies to benefit from disaster page 26

than meets the eye Many corporate secretaries initially underestimated the impact of new SEC disclosure proposals. With new rules set to be in place by year-end, there is a considerable amount of work to be done page 12

 Legal Growing awareness of the need to separate the compliance and legal functions page 35

00 Cover NEW.indd 1

21/8/09 12:08:14

Association for Media Evaluation Companies (AMEC) Annual awards literature

Measurement and evaluation showcase

2008 in partnership with


AMEC08 book_of_the_night.indd 2

The judges’ platinum award

4/11/08 13:24:01 Best use of media evaluation – public sector

of winners

and runners-up

Silver award TNS Media Intelligence – English Partnerships Bronze award Metrica – London Development Agency

Winner Echo Research – Government of the Kingdom of Saudi Arabia

researchers with strong language capabilities, Echo analysed 584 extracts from blogs in America, China, UK, France, Germany, Spain and Italy and other websites cited by journalists. When the Kingdom of Saudi Arabia In Part A of its report, Echo focussed invited foreign journalists to a Riyadhon a satellite view of Saudi Arabia’s based summit of the Organisation reputational assets (such as alliances of Petroleum-Exporting Countries with the West against terrorism) and (Opec) in an unprecedented move in liabilities (which ranged from a caricaNovember 2007, its Ministry of Foreign tured stereotype view to concerns over Affairs wanted an international perits human rights record). spective on what might interest the It indicated that journalists might focus media during the visit. on issues over press freedom to stories Echo Research, in what the judges about the palpably different status of described as ‘a brave and wide women compared to men. ranging analysis which sought to Part B, which assessed attitudes towards provide honest and unflinching comOpec, drew on the views of financial experts, munications advice’, was commissuch as Goldman Sachs and Citibank. It sioned to analyse media coverage in provided a predictive analysis and offered advance of the summit and to offer suggestions for communications strategies

Best use of media evaluation – international multi-market activity Gold award GlobalNews Group – BBVA

The judges’ platinum award Winner Echo Research – Government of the Kingdom of Saudi Arabia

Silver award Echo Reseach – Unisys Metrica – Symantec Bronze award Metrica – eBay International

Innovation award Winner TNS Media Intelligence Cymfony – Super Bowl Ads

Best use of media evaluation – international single-market activity

International members’ award

Gold award Echo Research – Government of the Kingdom of Saudi Arabia

Winner GlobalNews Group – BBVA

Silver award Echo Research – European Foundation for Democracy

Best use of media evaluation – B2B Silver award Mediatrack Research – Bupa

Best use of media evaluation – not for profit

Bronze award Echo Research – British Private Equity and Venture Capital Association Metrica – eBay UK Metrica – Symantec

Gold award Media Measurement - VisitScotland Europe Silver award Media Report – Finance Wales Metrica – 11 Million

advice on future courses of action. by the Opec media team. Echo was asked to consider both The judges viewed the research as the reputation of Opec, in light of oil ‘thorough and rigorous’, concluding: ‘This is a price movements, and the longerpowerful use of measurement and evaluation term reputational development of to investigate national branding, which is admiSaudi Arabia. Over two months, using rably direct in its recommendations’.

Bronze award Durrants – No Smoking Day 2008

Commendation Slovakia Online – Mediahit

Best use of measurement for a single event

Best use of media evaluation – B2C

Gold award TNS Media Intelligence Cymfony – Super Bowl Ads

Silver award Cision – 02 in Germany

Silver award Echo Research – Airbus SAS

Bronze award MediaMarket – Hibernian Group Media Measurement – Hilton Hotels UK NEWBASE – Arcandor Press Data – First ScotRail

Bronze award Durrants – Disasters Emergency Committee Metrica – London Development Agency

Young professional of the year award

Best use of integrated media evaluation/research

Winner Darryl Sparey, Media Report

Gold award Echo Research – SeverStal

Shortlisted Claire O’Sullivan, Metrica Anouk Reints, Publistat

Bronze award Mediastow – ALDAR Properties PSJC Metrica – eBay International

Best use of digital media measurement, including social media

Sponsored by

Page 6

Page 7

Silver award Echo Research – European Aeronautics Defence & Space Company (EADS) Metrica – Symantec

Innovation award Winner TNS Media Intelligence Cymfony – Super Bowl Ads

Young professional of the year award Winner Darryl Sparey – Media Report

€3m (£2.4m) for just 30 seconds of airtime during Super Bowl. One added: ‘Top marks for the idea and the execution.’

Sparey joined Media Report in 1998 as a 19 year old analyst. Three years

Although not commissioned by a client,

later he was appointed business development director, generating

TNS Media Intelligence Cymfony conducted a groundbreaking analysis of the impact of advertising during America’s Super Bowl.

six-figure revenue growth through new media evaluation programmes for clients such as Cisco Systems,

Drawing on social media as well as more traditional outlets, TNS Media Intelligence Cymfony was able to assess what did and did not work for advertisers. It discovered a

and headed up a management buy-out, which installed him as the managing director with a focus on client retention. He sold Media Report

strong correlation between traditional media coverage and social media discussion, and

to Precise Media Group in 2004, and now has responsibility for business development and rolling out his

identified the top 100 social media sites for both pre and post-game discussion. The judges found that the research, which has since been sold to several major advertisers, ‘had real value for advertisers’ who pay up to

former company’s evaluation services to Precise Media’s clients. At the age of 29, he is the senior contact for major clients across Precise Media Group.

Shortlisted Claire O’Sullivan Metrica Anouk Reints Publistat

Sparey was described as ‘ambitious

International members’ award

and dynamic’ who showed ‘real initiative in establishing a viable business’ by the judges, who added that he ‘stood out as a young and ambitious entrepreneur who is fully committed to the development and prosperity of his employer and of the media evaluation

Winner GlobalNews Group – BBVA

picture view of media, aided by innovative use of political and social analysis’.

‘Any operation in this region cannot realistically be judged without taking into account the geo-political backdrop,’ they added. ‘This represents a sophisticated and informal approach to understanding coverage in the region.’ The evaluation enabled BBVA to plan a

industry in general’. In recent years, Sparey developed Media Report interactive (MRi), an online evaluation service providing timely, actionable insight that enables communications teams to drive the success of their PR campaigns. The judges said Sparey demonstrated ‘a truly astute understanding of client needs leading to genuine innovations’. More than 20 clients, including Scottish Widows and the Royal Horticultural Society, have incorporated MRi into their evaluation strategy this year. The judges said Sparey’s ‘energy and commitment to professionalism in terms of PR evaluation is inspiring and will hopefully lead other young talents to devote their time and energy to proving the impact of communications’.

Page 9

Page 8

regional press management strategy, and has become a key tool in the development of its media presence. It soon emerged that implementing a similar strategy and

Philippe Wojazer / Reuters

The quarterly evaluation of BBVA’s media coverage in Latin America produced alongside an analysis of the political, economic and social context of each country was ‘applauded’ by the judges.

Sponsored by

even having the same information to communicate led to very different results in the countries. The judges found this to be ‘a very big

e 4

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Thursday 13th September The Regent Sydney

CSA is proud to be a sponsor of the Best Corporate Governance Award and we are pleased to be able to offer all CSA members a special discounted rate price to attend the Awards.

Everyone concerned with investor relations will be there; companies, institutional investors, providers of IR advice, annual report consultants, brokers, investment bankers, stock exchange representatives, and investor roadshow managers – proof that investor relations and its practitioners are an essential part of corporate strategy. The Awards Dinner should be an unmissable date in your calendar.


Wednesday, November 7 Tavern on the Green, New York

Your invitation to join Wall Street in Central Park

Who is the best of Australian IR and how do they stack up against the world leaders? Find out at the biggest gathering of the IR calendar as 200 fund managers, buy and sell-side analysts give their views to determine who they are in an evening filled with anticipation and celebration.

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Editor Clare Harrison Chief copy editor Kathleen Hennessy Contributor Adrienne Baker Head of art and production Mariel Tabora Foulds Assistant design editor Jonathan Parker Senior Designers Catherine Schmitt Brookes, Julie Binchet Designer James Noden Managing director Janet Dignan President Ian Richman Publisher, IR magazine Harvey Hudes Sales and marketing director David Sweet Sales and marketing assistant Katie Feuer Sales assistant Gabriella Gal Cross Border Ltd Churchill House, 142-146 Old Street, London EC1V 9BW, UK Tel: +44 20 7251 7500 Fax: +44 20 7490 4349

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General inquiries Email: Websites:,

IntroductIon access all areas



Market IntellIgence


roadsHow dIarIes

HarnessIng Market InsIgHt

gettIng tHe tIMIng rIgHt


Investor outreacH tHe non-deal roadsHow: tHe key to success

10 corporate perspectIve tales froM tHe road

12 partnerIng BuIldIng a strategIc partnersHIp

16 targetIng Beyond tHe well-trodden patH

18 analysts’ vIew advIce froM tHe sell sIde

Printed by Buxton Press Ltd, Palace Road, Buxton, Derbyshire SK17 6AE, UK

20 capItal raIsIng

Corporate Access is published by Cross Border Ltd, Churchill House, 142-146 Old Street, London EC1V 9BW. © Cross Border Ltd 2010. All rights reserved. Reproduction in whole or in part without written permission from the publisher is strictly prohibited. Articles are published without responsibility on the part of the publishers or the authors for any loss occasioned by any person acting or refraining from action as a result of any view expressed herein.

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May 2010

Will activists go wild in a proxy access world? New regulations shift power How proxy access is shaping up Revisiting over-voting and NOBOs v. OBOs Avoiding ugly proxy contests How to approach private ordering


ong Kong and Taiwan Investor Relations Conference & Awards 2005. htime awards ceremony highlighting and honoring best practice in munities in Hong Kong and Taiwan.

IR Magazine

Hong Kong and Taiwan Investor Relations

a program that will bring together an array of leading IR practitioners. ng sectors and market caps, panel discussions and one-to-one interviews, xciting and thought-provoking day. The IR Magazine Hong Kong and & Awards is the must-attend event and the most prominent networking g Kong and Taiwan.

Conference & Awards 2005


Thursday, November 3 Island Shangri-La, Hong Kong

itive measure of outstanding IR performance worldwide. Across eleven ers nominate those companies that have excelled in their investor relations at this awards lunch filled with anticipation and celebration.

The largest gathering of investor relations professionals from Hong Kong and Taiwan

Speakers include:

cap and small or mid-cap

Leon Ku, senior executive and vice president, Taiwan Stock Exchange

cap and small or mid-cap ate literature

David Webb, elected non-executive director of Hong Kong Exchanges and Clearing Limited and founder of Rowena Chu, head of equity capital markets for Asia, Deutsche Bank Martin Cubbon, executive and group finance director, Swire Pacific

a PRC company

espondent, commenting IR in South Africa has mes being on a par hostile takeovers, BEE, s that have, throughout s with the best.

nt professionals and ations. The results

ce again be filled with

in association with:

Wendy Webb, senior vice-president of investor relations, Walt Disney Company James Wu, CFO, Chunghwa Picture Tubes Michael Austin, CFO, Top Form International Liz Lemon, international senior IR manager, Cisco Systems

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Conference & Awards 2005 Wednesday, July 20, Hilton Sandton, Johannesburg

ew prospects – everyone Magazine South Africa le who believe in

Speakers include: Brian Molefe, CEO, Public Investment Commission Ferdi Dippenaar, marketing director and head of IR, Harmony Gold Mining Lionel October, deputy director general, Department of Trade & Industry Alec Hogg, editor-in-chief, Moneyweb Clive Thomson, CFO, Barloworld Leon Kirkinis, CEO, African Bank Rob Katzen, financial director & head of IR, AVI James Murray, chief executive, Xantium Technology Holdings Marci Pather, chairman and chief executive, All Joy

Conference also features cross-border transactions workshop presented by

MAY 2005 � ISSUE 2



Flying high an examination of Air China’s IPO A necessary burden? the pros and cons of listing overseas Winning ways China’s brightest and best in IR

Tom Online Cemex


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Successful communications in challenging times

IR put to the test by economic downturn Web multiplies risks – and opportunities Hedge funds adding to volatility Consistency is key to riding it out

A n e d u cAt I o n A l S u p p l e m e n t to I R m AgA z I n e

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Lesson from

1139 By Olivier Servais, International Accounting Standards Committee (IASC) Foundation XBRL team leader

Belgium’s 270,000 registered companies, if opting for the electronic way, has had to

decision, following an effective – and indeed impressive – due process. Let’s hope the transition to XBRL in the US markets

use XBRL to file its annual accounts to the National Bank of Belgium (NBB).

will be as smooth as in Belgium. As the team leader for the IASC Foundation, whose standard-setting body, the International Accounting Standards

Multiple benefits The benefits are manifold. It saves time for the regulator, as the data are already

Board (IASB), is responsible for developing IFRS, I am closely involved in the use and development of XBRL for international financial reporting. While we are in no way connected with the SEC’s

electronic, so there’s no need for any scanning or spot checking, as there is no room for error. Accounting packages have

decision to make the use of XBRL mandatory, we are promoting XBRL because we believe in the benefits it offers all stakeholders, including regulators, preparers of financial statements and end-

been upgraded to be XBRL-compatible, so accountants need only click on a button to produce the XBRL document. Investors and banks can now benefit from electronic

users such as investors and banks. Our commitment is to provide IFRS in XBRL – the so-called IFRS taxonomy – to the highest quality, at the same time as the IFRS principles are released, usually once a year, in the IFRS Bound Volume.

data available from the NBB website for free. And last, but not least, the issuer can enjoy filing fees reduced by a third,

Early edition

owing to savings made by NBB. Today, the market is wondering whether the SEC’s recent decision to mandate the use of XBRL was appropriate. When reading the text of the rule, there is no doubt that, as we might expect from such a body, the SEC has heavily documented its


Interestingly, the IFRS taxonomy has been released this year before the publication of the IFRS Bound Volume 2009, but the purpose of its launch – reflecting a similar due process to that of the IASB – is to get comments on it before its final version is released in April. Naturally, we expect extensive comments from the US since this IFRS taxonomy will be the first to be used by non-US companies listed in the US when filing their financial reports in the US electronically, should they choose early adoption. Even if the number of companies already using XBRL for their

aybe the current market turmoil will force us to learn from a decision that was reached in 1139. During

IFRS filings is pretty limited, there are several projects around the world to allow or mandate IFRS and XBRL. Countries like Canada, South Africa, Europe and South America will soon follow the US’

the Catholic Church’s second Council of Lateran, Pope Innocent II recommended not using crossbows or ballistas – a type of medieval catapult – because the arrows and

recent rule or similar initiatives in China, Japan and India. Another trend users might be interested in is the opportunity for companies to move to IFRS with the assistance of XBRL. Even if

darts they fire could be launched so far soldiers would be unaware of the consequences of their action. Some investment bankers would do well to remember this basic principle of caution. The good news is that today, even if the

XBRL is not the deciding factor in changing accounting principles, some consider having a robust set of tags, which could ease the mapping between concepts, to be an attractive asset. At present, more than 110 countries worldwide are either

likes of Bernard Madoff or Indian software company Satyam have thrown caution to the wind, stakeholders are getting closer to the information they need. You might be wondering where XBRL fits into all this. Well, the period when XBRL was promoted for its potential benefits – remember the ‘better, faster, cheaper’ mantra? – is over. Promises are already being realized. Take the example of Belgium: since April 1, 2007, every one of

allowing or mandating IFRS and none is ignoring XBRL. It is no coincidence that the main expected benefit of Belgium switching

The period of promoting XBRL for its potential benefits is over. Promises are being realized Olivier Servais, IASC Foundation

to XBRL was to ease the transition to IFRS. The world’s financial markets are desperately seeking greater accuracy; in this respect, they have much in common with Pope Innocent II.


The opinions expressed are those of the author and do not necessarily reflect the views of the IASB or the IASC Foundation.

12 XBRL unlocked

XBRL unlocked 13

Global spread

Global spread

British reserve

borders Fay Sanders goes on a whistle-stop tour, giving a country-by-country account of the forerunners and laggards of the XBRL world


German gaffe

Much to the despair of the IASB, the UK’s Financial Services Authority (FSA) says it has no intention to adopt XBRL in the foreseeable future. ‘XBRL allows listed companies to make their financial information publicly available,’ reads a statement on the regulator’s

Germany suffered an embarrassing setback when corporate filing authority the Bundesanzeiger had to retract its 2007 ruling that companies must submit their financial statements in XBRL format. ‘The Bundesanzeiger clearly hadn’t done its home-

website. ‘But the FSA is not required to facilitate access to this.’

work – its system wasn’t compatible with German

The FSA claims regulated firms are inexperienced in XBRL and are better off with XML. But it’s hardly surprising UK quoted firms are in the dark if neither the regulation is in place, nor the obvious advantages clearly known or understood. The FSA could do with following the lead of Companies House,

regulation,’ explains Kay Bommer, managing director of German IR society DIRK. Confronted by DIRK and German shareholder association DAI last year, the Bundesanzeiger acknowledged that firms should revert to filing in the more rudimentary XML format.

which has been accepting XBRL data from UK businesses for the past few years. ‘We are strongly encouraging firms to file

Although XBRL is now accepted again, German firms are understandably wary of the process.

in XBRL format,’ says Companies House. The UK tax authority is aiming to mandate XBRL filing for corporation tax by 2011 so it would make sense if all financials were filed in the same format. BP’s vice president of IR Peter Hall warns that XBRL filing may

A notable exception is DAX 30-listed industrials conglomerate ThyssenKrupp, which is well on its way to converting to XBRL. ‘It’s another service we want to add to our existing portfolio to benefit analysts and investors,’ says head of IR Claus

pose problems for the oil sector. ‘Given that inventory movements can amount to $4 bn in a single quarter, it’s vital correct numbers

Ehrenbeck. Luckily for the IR team, ThyssenKrupp’s accounts department is developing a taxonomy and the firm aims to

be reflected through XBRL,’ he remarks. ‘Currently they aren’t, so the one-size-fits-all system would confuse rather than help.’ He agrees XBRL simplifies the dissemination of financial data as we increasingly move toward paperless publications, but says work is required to make the system more flexible.

begin filing in XBRL next month.

espite the International Accounting Standards Board

Spain keeps it simple

(IASB) devising its own XBRL taxonomy, take-up in Europe

Spain is the only country in Europe to have made the leap to making XBRL reporting mandatory, and issuers are embracing the

Dutch deliberations

switch. ‘It makes my life much easier, because the information is delivered in seconds, can’t be manipulated and is very easy to send,’ enthuses Ignacio Cuenca, director of IR at Spanish power giant Iberdrola. ‘It’s hard to imagine the

The Netherlands is also beginning to encourage XBRL filing for smaller, non-listed companies. ‘Our aim is to reduce administrative burden, and there are many more non-quoted companies

Dutch IROs have mixed opinions about XBRL. ‘We don’t need any more complexity or experimenting, and I don’t see the

filing financial information than there are listed companies,’ remarks Harm Jan van Burg, senior policy maker at the Dutch

immediate benefits,’ remarks Bart Gianotten, IRO at Randstad Holding. Another Dutch IRO says it

Ministry of Finance. Unlike the US, where he believes the focus is on improving information for investors, Van Burg says the onus should be placed on the ways data analysis can help companies benchmark themselves in the market.

would help if numbers were more comparable, but has ‘no idea about the effort involved.’ Van Burg admits Holland is ‘not there yet in terms of implementation’, but he is wary of the US timeframes, which he describes

The Dutch government is developing a harmonized taxonomy, incorporating both national and IFRS legislation. ‘At the moment,

as aggressive. For companies with dual listings in the States, Van Burg says it’s the IRO’s job to make management aware XBRL

businesses in the Netherlands have to file to both the Authority for the Financial Markets and the tax agency,’ comments Van Burg.

is coming. ‘And they’d better do it fast,’ he warns, pointing out that Royal Dutch Shell has less than a year to get itself ready.

has been sluggish, to say the least. It’s a far cry from Asian XBRL activity, which is virtually the norm in many countries. China took the leap as far back as 2002. Others more tentatively followed suit, with Japan switching to XBRL filing last year after extensive testing of the market. Not wanting to be outdone by Asia, the US finally took the plunge in December 2008 after months of speculation. The success of XBRL is largely dependent on the checkered grid of countries turning to interactive filing across the world’s listed

stress we used to have on results day.’ XBRL filing in Spain is especially straightforward because companies simply have to fill in a form, which gets automatically converted into XBRL format. ‘At the end of 2004, we decided to receive information in a way that’s helpful to everyone,’ explains José-Manuel Alonso, head of IT at the Spanish securities regulator CNMV. ‘We timed making XBRL mandatory to coincide with the changing content of our own regulation in 2005.’

markets, outlined in the following pages.

2 XBRL unlocked

XBRL unlocked 3

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Jonathan Parker Portfolio

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