Can I offer you an annual report?
This time of year often marks the starting point for the process of planning the work with this year’s annual report. Not very different from young people trying to sell Christmas magazines, communications agencies is trying to get client to place their orders for a later delivery date. By coincidence, it usually coincides with invitations to various seminars, where among other things, one can learn about current annual report trends.
One discussion point that I have never seen is how to measure the financial outcome of the annual report process, i.e. a model for how to follow up on whether you reached defined goals. I expect that everyone has defined one or more goals with the annual report project, or?
It’s a rare luxury to have such a large IR budget that you don’t have to weigh various IR investments against each other. Most companies certainly need to make trade-offs between different activities. In that case it is obviously important to have well defined and relevant measurements to compare against each other in a budget process. For truth be told, when was the last time you kicked off this year’s IR web project?
The information contained in the Annual Report should of course also be available on the IR Web. The big difference is that where one is a snapshot, the second should offer updated and relevant information 24/7. In order to find an optimal balance between resource utilization and achieved output the effectiveness of the IR Web and the annual report should be compared in order to find the best mix. When we asked financial professionals in our recent financial market survey of the importance of the annual report and the IR web we found that the IR Web is more important as a source of information than the annual report. (This is remarkable especially given the amount of resources that is pumped into the yearly production of annual reports).
Something’s got to give
The probability that the IR-budget will get a boost in order to pursue a more active IR work on the Web is rather slim. That leaves only the possibility of taking resources away from something else, which for many companies would be the annual report that on average accounts for half of the IR-budget. The big question is then whether one can get a good product at a lower price; our answer to that question is undoubtedly yes. If one is not particularly trend-sensitive and drops the goal of taking a top position in any of all the” beauty contests”, most companies can allocate resources from the annual report to the IR website. (Our offer AR in a Box is an example of this)
How to move forward obviously depends on what your IR-goals are. If the goal is to reach out to more potential and existing shareholders, perhaps it is time to start planning for the yearly IR web project.