THERE'S MORE TO BEING PUBLIC THAN BEING LISTED

Management of today\'s publicly held organizations is aware of the responsibilities and opportunities in providing information to various segments of the financial community. However, Securities Exchange Commission (SEC) suits, such as the Texas Gulf Sulphur case, have emphasized the importance of seeking professional guidance before public relations programs are implemented. Good, properly executed financial PR programs can assist management in building confidence and prestige for the company with a number of groups. These groups include: present shareholders; the investing public at large; members of the financial community (including bankers, security analysts, investment advisors an others who influence opinions) and the general business-oriented public. Some Guidelines The breadth and depth of your financial PR program can vary. However, here are some basic rules to keep in mind when you begin developing the program that is best suited to your firm and its needs. 1. \"Timely disclosure\" is an obligation. The whole idea is wrapped up in this statement from the company manual of the New York Stock Exchange ... \"Important developments which might affect security values or influence investment decisions should be promptly disclosed. The manual also says that news requiring immediate publicity must be released by the fastest available means. This usually means a release to the public press by telephone, telegraph, hand delivery or some combination thereof. Or better yet, use a wire service, such as Business Wire, that is tailored to business news. You may not be listed on the Big Board, but its rules are good ones to follow. Adhering to them prevents you from getting in a position where you can be accused of letting insiders take advantage of the situation. 2. Accept the idea that it\'s your responsibility to develop interest in the financial community for your securities. There\'s nothing undignified or unethical in getting analysts, brokers and others to know your company. In order to arrive at a fair market price for securities, complete information, properly interpreted and evaluated, is necessary. Often, a special effort has to be extended by the new company to be sure that there is an audience for the full information. 3. Be candid and tell your story completely (and interestingly). Occasionally, there\'s a temptation to tell only the good and to sweep the bad under the rug ... or at least camouflage it. Don\'t do it. You\'ll be better off in the long run. 4. Capitalize on your publicity opportunities as a publicly held company. You\'re now in a position to tell more than you were when privately held, and there are more and better chances to publicize your company, your products and services. Financial PR Checklist So much for generalized thinking about financial public relations. Following is a checklist of specifics. It doesn\'t cover everything, but it will get you started: 1. Welcome -- A brief communication--possibly a letter, possibly a printed piece--to you new shareholders is a good idea. Nothing fancy or formal is needed. Just let the investors know that you\'re glad to have them aboard. 2. Financial Service Reports -- Make arrangements for Standard & Poor\'s, Moody\'s and other financial service reports to be issued on your company. If you let things ride, eventually they\'ll get around to you, but it\'s entirely in line for you to contact them first. 3. Daily Quotations -- As a company that\'s just gone public, your shares, of course, are traded over the counter. You, your shareholders and the investment professionals will welcome daily publication of your stock prices in, at least, the local newspapers and preferably in the Wall Street Journal. The National Association of Securities Dealers (NASD) determines, on the basis of number of shareholders, the amount of stock they own and their geographical distribution, what kind of listing companies are qualified for--local, regional or national, daily or weekly. 4. Sales and Earnings Results -- Plan to keep shareholders and the financial community regularly informed about your company. This means: * At the end of each quarter and at the end of the year, a news release announcing your sales and earnings should be released to the press and financial reporting services as soon as possible after the figures are known. The release should give the data on sales, earnings and earnings per share, compared with the results of the corresponding period a year earlier. It should also include pertinent comments from the president and/or chairman. * You should prepare not only annual but also quarterly reports to send to shareholders. The reports serve to keep them informed of corporate progress, and they provide current information to the financial professional. Create an attractive format--not shoddy, but not too expensive looking--and include a message from the chief executive officer, along with a brief income statement with comparative figures. Recognize that the mechanics of something, even as simple as an interim report, can get fairly complicated, so start to work well in advance. * Your annual report is the most important compilation of information on your company that will be issued in any given year. It deserves a major effort so that words and graphics will satisfactorily and accurately represent your firm to the public. The job involves setting deadlines, writing copy, working with auditors, design, printing, photography and an almost endless set of details. 5. Prompt Disclosure -- As indicated earlier, you should immediately publicize major corporate developments such as acquisitions, research breakthroughs, major new products or services, discoveries, etc. In an acquisition, that means publicizing the event no later than immediately after signing the agreement in principle, and sometimes it might be necessary even earlier than that because news of negotiations tend to get around and result in rumors. Besides immediate issuance of the news release, consider a special communication to shareholders. 6. Dividends -- Announce dividend actions--regular, special or failure to act--to the press immediately after the board of directors votes. It\'s also a good idea when mailing your dividends, to include a stuffer that gives your shareholders more information about their company. 7. Fact File -- A good communications tool is a \"fact file,\" which gives information about operations, management, financial history, capitalization, markets and marketing, etc. Such a document is useful in developing publicity, in informing shareholders, in your liaison program with the financial community, in the development of a new interest, and with some modifications, it can be used in your marketing and employee relations activities. 8. Annual Meeting -- There\'s no way a newly public company can predict how many people will attend the annual meeting and what their interests will be. In any event, be prepared to be cordial, informative hosts. * The chief executive officer\'s presentation should be prepared. * Consider displays highlighting company products, services, financial results and so on. * Invite representatives of the press and interested members of the financial community. * For press distribution immediately after the meeting, prepare a news release in advance, covering highlights of the chief executive\'s presentation. * Have information handouts ready, including annual reports, product literature, fact files and so on. * Consider the amenities. This includes: setting up a comfortable meeting room well in advance; issuing special invitations in addition to the formal proxy statement to shareholders; possibly offering refreshments; offering a plant tour; providing name badges for the officers and directors, and introducing them during the meeting. * If your annual meeting goes beyond the routine, consider reprinting the full proceedings, or at least a digest, for distribution to shareholders and the financial community who were not present. 9. Publicity -- Develop a financial publicity program, directing your attention toward such media as Barron\'s, The Wall Street Journal, business pages of your daily newspapers, various financial magazines and major trade publications. Develop publicity on what\'s different about your company, the progress it has made, the outlook for your products and services, your research program and/or major new products. 10. Mailing -- Keep the financial community informed about your progress by sending them copies of such materials as interim reports, annual reports, fact files, reprints of major publicity items, news of acquisitions, research breakthroughs and copies of special shareholder communications. 11. Mailing Lists -- Obviously, having good mailing lists will make life easier when you have a report or news release to issue. You\'ll want separate lists of financial media, daily newspapers, analysts and brokers who show an interest in your company. 12. Financial Community Liaison -- It\'s possible that you\'ll be swamped with attention from financial analysts and other influentials in the financial community from the moment you go public. But, that would be the exception rather than the rule. To attain the interest your company deserves, the chances are you\'ll have to take steps to seek it out. There are various ways to stimulate interest: * Set up a personal contact program aimed at brokerages, funds, etc., which might or should be interested in your company. The person to contact might be an analyst, a partner, or a sales manager or broker. This is not a job for the chairman or president, although there are circum- stances in which the top man\'s direct participation is called for. It\'s a role that can be filled best by a competent financial public relations firm. Your repre- sentative making these calls should be well informed about your company and industry and have suitable printed material to leave behind. * Under the proper circumstances, top management also should be exposed to the financial community. Considerations here include: - Select and make arrangements with the appropriate audience. Possibilities include analyst societies; specialized analyst groups such as those interested in science and technology, service industries, transpor- tation, etc.; top-level brokerage representatives, who could be invited to an informal luncheon; key investment salesmen; investment brokerage sales staffs after the market closes; and analysts and brokers as guests at privately sponsored meetings. - Select the geographical locations. Depending on various circumstances, you might wish to arrange for exposure in the primary markets--New York, Chicago and Los Angeles-- or secondary financial markets. - Prepare the presentation. This includes the speech, charts, slides, product displays, information kits, etc. - Consider reprinting and distributing the presentation. 13. Pulse Taking -- Periodically evaluate the amount of trading in your stock, the role played by firms making a market in your shares, the geographical distribution of shareholders, possibilities of listing on an exchange, future needs, analyst attitudes toward your company and so on. Based on your findings, take remedial action. 14. Responsibility -- Implicit throughout the financial public relations activities outlined above is the appointment of a high-level, informed company officer to be responsible for the program. # # #

Author:.

G. A. "Andy" Marken President Marken Communications, Inc. Santa Clara, CA Andy has worked in front of and behind the TV camera and radio mike. Unlike most PR people he listens to and understands the consumer’s perspective on the actual use of products. He has written more than 100 articles in the business and trade press. During this time he has also addressed industry issues and technologies not as corporate wishlists but how they can be used by normal people. He has been a marketing an...

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