Online?

Interesting to see the results of the Smith Partnership’s research into online reporting takeup amongst the FTSE100 (Companies failing to exploit internet, Financial Times, 29 May 2007) but perhaps not entirely surprising.

It is interesting that according to this research under half of the FTSE100 are offering HTML versions of their annual reports this year: the majority are sticking to simple PDFs of their printed reports. And, with one or two exceptions, our biggest companies are so far failing to take advantage of the opportunity to build their online and interactive brand communications.

But it’s perhaps not surprising.  For a number of reasons.

Firstly, the new Companies Act provisions came in too late for the December year end companies to do anything other than put in place the enabling resolutions this year. Initial indications are that even amongst the March year end companies, who have had more time to consider their options, not all will actually ask their shareholders to elect this year.

Secondly, most companies have worked out that far from saving them money, adding a fully interactive HTML report to the printed or hard copy that they are still required to produce will cost them substantially more. Savings are only likely for the minority of companies with large share registers.

This becomes significant if IR and corporate communications departments are unconvinced of the communications benefits of the switch to online. We know, for instance, that institutional shareholders want to continue with hard copy annual reports. But perhaps even more significantly, there is anecdotal evidence that IROs are getting feedback of shareholder concerns about disenfranchisement.

We may all believe in the theoretical benefits of online reporting – but are we too far ahead of the practise?