Tuesday, July 08, 2014

Using the Internet to Inform Investors

For over fifteen years now, companies have been reporting their investor information on 
their websites. At the time, this was a big change because traditionally, they issued big printed
annual reports with all the financial and business information.

Now, there is a general recognition that the website information in the Investor Relations 
sections of the websites is the prime source of information by investors and others. Generally
speaking, specific information is easier to find on the web than it is by leafing through print
documents. And then, it is easier to use, since the information is already digital and can be
transported over to individual desktops for further analysis. That is, some of the time.

The difficulty is that quite often companies have found it hard to move away from the old 
print paradigm. They persist in presenting information in large PDF documents that preserve
the information just as if it had been printed. Nothing against Adobe here. It’s just that if that
is the only way the information is presented, then we lose the benefits of a digital format for
presenting information because typically PDF documents are difficult to extract information
from and leave the user in exactly the same position as if the information had been printed.

Some of the more progressive companies do provide the information investors need in 
alternative formats. Potash Corporation, for example, long a leader in financial reporting and
winner of many awards, provides a “Data Tool” in which a variety of information is
presented in a format that can be easily manipulated and downloaded for analysis.

Others, such as Agnico and BMO, also leaders in investor relations reporting, offer financial 
information in their websites in Excel format, which of course can be imported directly into 
individual user spreadsheets. Still others, such as Thompson and Tim Hortons offer their 
information in XBRL (eXtensible Business Reporting Language) format, a powerful format 
that is easily transported across platforms and analyzed in real time mode.

People want to consume financial information not just by reading it, but by analyzing it. 
Offering them at least the opportunity to choose seems not an unreasonable proposition, and
one that is easily accommodated by the web. Lets hope that those companies who are stuck
in the past rethink their approach.

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