Time to kill secretive dial ins

Each year around this time, in anticipation of the August reporting season, we receive emails from many companies inviting us to their results briefing.

Sometimes held in swanky hotel meeting rooms for the benefit of those who prefer to 'see the whites of their eyes', but usually by remote access only nowadays, these events allow management to add context to their recently-reported results and allow analysts to ask questions, broad or specific, about the company's trading.

The events are usually by invitation only. That's a polite way of saying they're for analysts and fund managers only, the riff raff of smaller shareholders needn't apply. Most of the time, retail shareholders only end up seeing a short PDF of the slides that were presented, and hearing nothing of what was actually said.

While we certainly don't agree with that sort of discrimination and have nothing but empathy for small shareholders in the fight against institutionalised information asymmetry (hence this blog post), we understand the desire for exclusivity from some analysts.

Many, ourselves included, have to listen, digest and write updates on the results of numerous companies in a single day. Unlike annual general meetings, results briefings are never hijacked by environmental protestors or by a single shareholder irate over small font or an absence of scones. They start on time and are usually over in an hour or less.

Where we have a very genuine objection, though, is in the continued 'backroom' nature of many such meetings. In the modern era, recording equipment is dirt-cheap and making the recording available to all shareholders through webcasts is easier than ever. It should be mandatory. A few prettied up slides is not a sufficient alternative.

Progressive companies, large and small, have for years been making results webcast audio files available for the benefit of anyone who cares to listen. So while the smaller investor might not be able to ask a query, they are able to listen to everything management had to say, including analysts' queries and management's responses. Broadcasting such events helps keep the whole market informed while ensuring no group of shareholders is at a disadvantage to another.

Can you believe that, in the year 2012, most companies still hold these events exclusively as 'dial ins'? Analysts are given a phone number to call on a certain date and time to participate in the event live. They usually get a caller ID (tantamount to a password).

Perhaps, with a little luck, that number will also give that select group access to a recording of the event for the next day or two. Then, after giving this one class of stakeholder preferential treatment over others, the recording disappears into the sands of time, never to be heard again.

Our objections to this treatment are numerous but include the following:

Firstly, should all shareholders be considered equal, or are some more equal than others? Some analysts like to feel special (we can be an insecure breed) but why should you (management) care? Do you want transparency and accountability to all shareholders, or are these just words the ASX make you utter? In other words, are you afraid of a level playing field among shareholders, and indeed potential new shareholders? If so, why?

Secondly, is there any specific reason why you don't make the recording available for more than a day or two? Do you have a valid objection other than this being insurance against being made to eat your words in a year or two if things don't go to plan?

As far as we're concerned, unrecorded dial ins are dinosaurs. By all means, use telephones rather than new (and cheap) technology for the event. And keep the list of potential questioners exclusive if you must. But all such events should be recorded, with a link to a recording published on the company's own home page and in an ASX announcements. Such recordings should be accessible for all posterity.

Any company committed to fair dealings should do so now, before the rules catch up with the realities of modern telecommunications. We don't see any valid reason why preferential information sharing should be allowed in the year 2012.