Shallow earnings call archives raise questions
By IR Web Report Staff
Companies that post conference
call webcast replays on their sites for only
short periods are making a big mistake. They
often appear less transparent than other companies
and may lose investors to other websites.
Almost 38% of the companies in our rankings
survey fail to provide access to even their
most recent conference call on their IR websites.
Legal concerns are the main reason for short
call archiving practices at many of these companies.
Their lawyers are worried about giving investors
ammunition to hold management accountable for
its forward-looking statements and unscripted
remarks during analysts' questions.
Some companies may argue that cost plays a
role in their decisions, especially when investors
rarely use old webcasts. Vendors may charge
them extra fees to host streaming audio archives.
However, there are cheap alternatives that companies
can use for older call archives, such as posting
them in downloadable MP3 format.
Also, it is dangerous to base decisions about
content only on how often investors access and
use the information. This is because the few
investors who are using the information may
actually be extremely important to the company.
They may be major new potential institutional
investors doing initial research by going back
over the company's past disclosures.
 |
| You
can't get the call on the company's website,
but you can on Yahoo! Finance. This makes
the company's site less relevant. |
Even if they are never used, deep archives
add value to a site by just being there. Perceptually,
they make your website a more authoritative
and useful resource, one investors
are more likely to turn to when they need specific
or detailed information.
Something to hide
Companies with shallow archives risk
looking defensive. They can give the impression
that management is trying to make it difficult
for investors to hold them accountable for their
past statements and pronouncements. They may
give the impression that management lacks confidence
or that the company's lawyers are nervous.
The impression can be particularly strong if
the company's competitors provide archives of
conference calls, or if investors are accustomed
to companies that do so. The lack of call archives
may set off alarm bells with
investors and cause them to be more circumspect
of the firm's disclosure and communication materials.
Less reason to visit
Investors will only visit your website
regularly if it offers what they need. Conference
call archives are a key reason to use company
sites because they typically aren't available
for long periods from other sources.
Some companies make the mistake of removing
conference call archives from their site even
before they are removed from public
call databases, such as Yahoo! Finance.
Take the recent example of News
Corporation, the media and entertainment
company. During a recent review, we found that
the company did not have a single conference
call replay available.
However, the company's most recent call was
available on Yahoo! Finance. This means
investors in News Corp. have a better chance
getting information from one of the company's
competitors -- Yahoo! - than from the company
itself. Another irony is that
the conference calls are provided to Yahoo!
Finance by News Corp.'s investor relations webcasting
vendor Thomson Financial.
News Corp.'s practices are symptomatic of a
bigger problem -- the company is a bad communicator.
Given that its business is all about communications
that's not a good thing.
Read our