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DIRECTIONS SUPPLEMENT JANUARY / FEBRUARY 08
TRENDS AND ISSUES IN THE WORLD OF CORPORATE REPORTING
Examining best in class features of FTSE 100 online investor centres
Directions Supplement January / February 08
Welcome to the new edition of Directions Supplement. In this issue we examine the emergence of the online investor centre as a point of contact between a company and the wider investment community. When done well an investor centre provides an informative, clear and engaging communication channel for all stakeholders. But with a variety of audiences, changes in legislation and a bewildering array of new web technologies available how are the leading companies approaching their investor centres? Salterbaxter’s Head of Interactive, Rob Newham, reviews the FTSE 100 companies and identifies some ‘best in class’ features.
What makes a good investor centre, what purpose should it serve and how should companies approach this valuable communication resource? Online stakeholder communication is playing an increasingly important role in investor relations. But the core aim remains the same: to communicate relevant and up-to-date information to the investment community.
Rob Newham Head of Interactive Salterbaxter [email protected]
Investor centres are not simply a repository of figures and financial data but neither should they be approached purely as a marketing tool. The key is balance. The most successful sites become portals through which companies can interact with their stakeholders; communicating strategy, performance, direction and culture, in ways specifically intended to be more accessible for all stakeholders, large and small. Research overview In order to get a clearer picture of the approach currently taken by leading companies we reviewed the FTSE 100 online investor centres. Our aim was to understand the different stakeholder communication options available and to highlight the successful features across the sites that deliver the most effective user experience. We analysed all the sites against a number of criteria, including: a clear overview of the company’s strategy; a strong investment case; content tailored to both private and institutional investors; good usability; appropriate use of technology; and clearly signposted e-communications.
“Investor centres are not simply a repository of figures and financial data but neither should they be approached purely as a marketing tool. The key is balance.”
Overall, all FTSE 100 investor centre sites were good at what we might term basic hygiene factors: up-to-date information; archived information to allow users to access a company’s performance over time; and IR contact information with phone, email or address details. All sites contained reports and accounts with 26% including basic PDF versions only and 65% also offering an additional HTML version for more convenient browsing online. (Of interest, 17% of sites provided sectioned PDFs as an alternative way of viewing and printing large documents.) But while broadly speaking our research shows that all the FTSE 100 provide similar online content, companies do differ widely in the way they choose to present information about themselves – ranging from minimum levels of statutory compliance to more creative and engaging forms of communication. Conclusion In summary, over and above the statutory requirements, there is a marked difference in the manner in which information is presented. The availability of new web technologies and changes in e-communication are fundamentally altering the way companies can interact with their stakeholders. But these innovations are only effective when used appropriately to enhance a stakeholder’s overall experience or understanding of the company. The sites that we have chosen to highlight as ‘best in class’ all provide good examples of companies that have achieved the right balance of providing useful information in the most accessible and engaging manner possible. We hope you agree – but, as ever, let us know your views too.
Company strategy / KPI overview We were interested to find that only 34% of the sites provide an overview of the company’s strategy or aims. Although on further investigation this information was usually found on either the main corporate sites, or deeper within the investor centre, we felt that its usefulness was lessened.
Centrica plc ‘Our Vision’: a clear and simple overview of the company’s strategy and aims. It is content driven, using plain language to convey its message, without recourse to technological gizmos. This site also contains an efficient summary of the wider marketplace to allow investors to form a fair judgement about the company.
Centrica
There was a wide range of ways in which strategic information about the company was presented: ranging from text-heavy descriptions to more accessible overviews, which contain a mixture of text, graphics, animation, and even video, to explain the strategy clearly. Cadbury Schweppes (Our Purpose and Values), Centrica (Our Vision) and Imperial Tobacco (Group at a Glance) are good examples of sites that successfully combine such features to make strategy clear.
Also of note: Cadbury Schweppes plc, Imperial Tobacco plc, Smith & Nephew plc
Imperial Tobacco
Cadbury Schweppes
The Investment Case It’s essential not to assume that stakeholders already know about a company prior to visiting the investor centre. However we found that only 13% of the sites surveyed provided a clearly labelled case for investment. And while many companies do touch on the subject by including prominent positioning statements (such as Imperial Tobacco’s ‘We’re committed to creating value for our shareholders’) they don’t go far enough. It’s not a case of the hard sell. In the best examples it’s used as a platform for a member of the senior management team to communicate one-to-one with stakeholders. For instance, Aviva feature a clearly signposted and powerful investment case on the homepage and give an overview of the key reasons to invest in the company by the CEO, David Moss.
BP plc ‘Investing in BP’: a key feature of a consistently strong investor centre. It contains all relevant information in one place and acts as a portal to greater detail deeper within the site. The ‘Learn about Investing’ tutorial courses are a particularly useful tool for the retail investor.
BP plc
Also of note: Aviva plc
Aviva
Personalisation Aviva plc ‘Your Page’: the most powerful example of the potential opportunities of Web 2.0 and personalisation. The site allows users to create their own bespoke investor page containing content tailored specifically for their needs. Other features include personal alerts, reading lists, bookmarks, calendar and notes pages.
Online investor centres provide the ideal means to cater for different audiences – private investors, professional and institutional investors, analysts, media, regulatory bodies and government – through the provision of tailored information. Although only 14% of the sites currently provide personalised content there is little doubt that this will increase as Web 2.0 technologies continue to be used. Aviva
The sites using personalisation most effectively contain prominent homepage navigation features to allow different stakeholder groups to find information specifically relevant to them more quickly. For instance, on Centrica’s homepage a button to prompt users ‘What do you want to do?’ gives drop-down options for browsing deeper within the site. Other good examples of effective personalisation can be seen on the homepages of Cadbury Schweppes (‘I’m interested in…’), BT (‘Useful resources & links’) and ICI (‘Right Information For You’).
Cadbury Schweppes ICI
Also of note: BT plc, Cadbury Schweppes plc, Centrica plc
“Innovations are only effective when used appropriately to enhance a stakeholder’s overall experience.”
Usability We found that 79% of sites provided convenient highlights and quick links on the homepage to allow users to navigate to more detailed information quickly. Good examples of this are the intuitive layouts of the Centrica, Imperial Tobacco, Shell and Unilever investor centres. Of interest, 37% of the sites reviewed could not be found via a user-friendly URL (e.g. www.vodafone.com/investor) when entered into a search engine or browser. It’s also essential that online investor centres are accessible to all stakeholders, regardless of their physical or technological capability, and where possible should adhere to W3C WAI’s Web Content Accessibility Guidelines. We were interested to find that 21% of sites do not yet even include a basic accessibility statement. The inclusion of simple tools such as navigation shortcuts, access keys (keyboard shortcuts that replace the need for a mouse) and font resizing for visually impaired users (as seen on the British American Tobacco homepage) ensure company information is accessible for all.
“The most successful sites become portals through which companies can interact with all their stakeholders.” Unilever plc A winning combination of good design, clear content, and simple and effective navigation. Unilever’s investor centre also conforms to a minimum of W3C Level A compliance throughout allowing all stakeholders to extract relevant information quickly and easily. Also of note: Imperial Tobacco plc Unilever
Technology Our research confirms that Web 2.0 technologies and rich media have been enthusiastically employed by the FTSE 100 companies: 69% of sites now contain webcasts, vodcasts or podcasts alongside the more traditional PowerPoint presentations. 46% of sites surveyed also include online tools (either provided by a third-party or embedded within the site) such as the interactive analyst tools provided by Aviva, Cadbury Schweppes and Vodafone. We were interested to see the increasing availability of information via mobile devices as seen on the Aviva, J Sainsbury, Rolls Royce and Shire sites.
BT plc
Vodafone
J Sainsbury
BT plc BT is the only site in the FTSE 100 which uses video on its investor centre homepage to enhance the quality and transparency of its investor relations. Vodafone plc Vodafone’s interactive analyst tool is representative of a general trend and allows shareholders to interact with performance figures in real-time. Also of note: Aviva plc, BP plc
E-communications With amendments to the Companies Act 2006 allowing wider e-communications we were interested to note only 12% of the FTSE 100 actively promoting the benefits of electronic documentation. Where companies do, Centrica’s ‘Electronic Shareholder Communication’ section is representative of the approach taken by highlighting the advantages of the switch in terms of benefit to both the individual shareholder (‘improved efficiency, ease of access and online voting’) and the environment. We would also note the use of incentive schemes such as BT’s online share management services (including prize draws and online portfolio management) or environmental initiatives (such as Scottish & Southern Energy’s tree planting scheme).
Rio Tinto
BT
Rio Tinto plc An effective initiative to incentivise shareholders to receive communications electronically linked with the company’s sustainable development agenda. If users register for the scheme, Rio Tinto buy a sapling to be used in the Woodland Trust’s treeplanting project, which aims to help plant 12 million trees in the UK over the next 5 years. Also of note: BT plc, Centrica plc
For links to all the sites highlighted please visit www.salterbaxter.com/directions19 Methodology: The research is based on a review of FTSE 100 online investor centres. All research was conducted by salterbaxter and every effort has been made to ensure that the data is accurate.
Michael Mitchell General Manager The IR Society
To view the IR Society’s Best Practice website guidelines please visit www.irbestpractice.org
Making best use of online communications When the Investor Relations Society first introduced its Best Practice guidelines, websites were still regarded with some suspicion as an investor communications tool. We wanted to encourage companies to use the new medium to best effect and therefore we developed the guidelines as a way of encouraging this. Today the website is the first port of call for most investors and analysts and it is absolutely essential that companies keep up to date with the opportunities that developments in the design and capabilities of the internet present. A company’s website is now its shop window to the outside world. The look and feel of the site reflects directly on the company. In the 2007 Best Practice Awards, the judges were impressed by the increasing breadth and depth of information held in the investor relations sections of entrants websites – particularly in small FTSE and AIM listed companies – but somewhat disappointed that
the presentation of online annual reports had made little progress on the previous year. There was a feeling that companies were waiting to see what the next moves should be, particularly in respect of the new e-communications requirements introduced by the Companies Act 2006. It is interesting to see from this survey that the majority of companies have still to develop their e-comms policies.
We expect to see continued innovative use of websites to communicate with existing stakeholders and potential investors next year and anticipate considerable improvement in online annual reporting. To this end we are revising and updating our best practice guidelines and these will form the basis of the awards for 2008 which will be announced in November. Whilst we will be looking at how companies make best use of technology, including interactive tools such as webcasts and podcasts, we will not be neglecting the requirements for excellent communication of those aspects which time and again the users of accounts say they are looking for – namely strategy, outlook and the link between performance and directors’ remuneration. With the increase in the amount of potential information which companies may wish to disclose online, we will also be looking for clarity in the content and structure of such communications. The IR Society welcomes this review as a very useful contribution to the continued development of online communications.
“ Today the website is the first port of call for most investors and analysts.”
Turnover to see salterbaxter’s pick of the best in class features of FTSE 100 online investor centres.
About us Salterbaxter advise companies on strategy, branding, corporate communications and design. Contact: Lucie Harrild [email protected] Tel: +44 (0)20 7229 5720 Pavan Athwal [email protected] Tel: +44 (0)20 7229 5720
The Directions Supplements support our main Directions report and are produced every two months. The main Directions report is published each year and is now regarded as the UK’s most comprehensive analysis of the trends and issues in CR communications. If you want a copy, call us on the number below or email [email protected]
202 Kensington Church Street London W8 4DP Tel +44 (0)20 7229 5720 Fax +44 (0)20 7229 5721 www.salterbaxter.com
This supplement is printed on Think Bright and is supplied by Howard Smith. It is an FSC (Forest Stewardship Council) certified material and is 100% recyclable. www.hspg.com Printed by CTD, an ISO 14001 certified and FSC accredited company. TT-COC-2142 ©1996 Forest Stewardship Council A.C www.ctdprinters.com
Our clients are extremely varied and include FTSE 100 companies; some of the world’s most exclusive brands; independent, entrepreneurial businesses; world-leading educational establishments; law firms; private equity firms and media companies. We name companies, re-invent companies and re-position companies. We help companies communicate with shareholders and advise them on how to address corporate responsibility. We launch, brand and re-brand. A key area of our expertise is corporate reporting and we advise leading UK and European organisations on strategy and design for their financial and CR communications programmes.
TRENDS AND ISSUES IN THE WORLD OF CORPORATE REPORTING
Examining best in class features of FTSE 100 online investor centres
Directions Supplement January / February 08
Welcome to the new edition of Directions Supplement. In this issue we examine the emergence of the online investor centre as a point of contact between a company and the wider investment community. When done well an investor centre provides an informative, clear and engaging communication channel for all stakeholders. But with a variety of audiences, changes in legislation and a bewildering array of new web technologies available how are the leading companies approaching their investor centres? Salterbaxter’s Head of Interactive, Rob Newham, reviews the FTSE 100 companies and identifies some ‘best in class’ features.
What makes a good investor centre, what purpose should it serve and how should companies approach this valuable communication resource? Online stakeholder communication is playing an increasingly important role in investor relations. But the core aim remains the same: to communicate relevant and up-to-date information to the investment community.
Rob Newham Head of Interactive Salterbaxter [email protected]
Investor centres are not simply a repository of figures and financial data but neither should they be approached purely as a marketing tool. The key is balance. The most successful sites become portals through which companies can interact with their stakeholders; communicating strategy, performance, direction and culture, in ways specifically intended to be more accessible for all stakeholders, large and small. Research overview In order to get a clearer picture of the approach currently taken by leading companies we reviewed the FTSE 100 online investor centres. Our aim was to understand the different stakeholder communication options available and to highlight the successful features across the sites that deliver the most effective user experience. We analysed all the sites against a number of criteria, including: a clear overview of the company’s strategy; a strong investment case; content tailored to both private and institutional investors; good usability; appropriate use of technology; and clearly signposted e-communications.
“Investor centres are not simply a repository of figures and financial data but neither should they be approached purely as a marketing tool. The key is balance.”
Overall, all FTSE 100 investor centre sites were good at what we might term basic hygiene factors: up-to-date information; archived information to allow users to access a company’s performance over time; and IR contact information with phone, email or address details. All sites contained reports and accounts with 26% including basic PDF versions only and 65% also offering an additional HTML version for more convenient browsing online. (Of interest, 17% of sites provided sectioned PDFs as an alternative way of viewing and printing large documents.) But while broadly speaking our research shows that all the FTSE 100 provide similar online content, companies do differ widely in the way they choose to present information about themselves – ranging from minimum levels of statutory compliance to more creative and engaging forms of communication. Conclusion In summary, over and above the statutory requirements, there is a marked difference in the manner in which information is presented. The availability of new web technologies and changes in e-communication are fundamentally altering the way companies can interact with their stakeholders. But these innovations are only effective when used appropriately to enhance a stakeholder’s overall experience or understanding of the company. The sites that we have chosen to highlight as ‘best in class’ all provide good examples of companies that have achieved the right balance of providing useful information in the most accessible and engaging manner possible. We hope you agree – but, as ever, let us know your views too.
Company strategy / KPI overview We were interested to find that only 34% of the sites provide an overview of the company’s strategy or aims. Although on further investigation this information was usually found on either the main corporate sites, or deeper within the investor centre, we felt that its usefulness was lessened.
Centrica plc ‘Our Vision’: a clear and simple overview of the company’s strategy and aims. It is content driven, using plain language to convey its message, without recourse to technological gizmos. This site also contains an efficient summary of the wider marketplace to allow investors to form a fair judgement about the company.
Centrica
There was a wide range of ways in which strategic information about the company was presented: ranging from text-heavy descriptions to more accessible overviews, which contain a mixture of text, graphics, animation, and even video, to explain the strategy clearly. Cadbury Schweppes (Our Purpose and Values), Centrica (Our Vision) and Imperial Tobacco (Group at a Glance) are good examples of sites that successfully combine such features to make strategy clear.
Also of note: Cadbury Schweppes plc, Imperial Tobacco plc, Smith & Nephew plc
Imperial Tobacco
Cadbury Schweppes
The Investment Case It’s essential not to assume that stakeholders already know about a company prior to visiting the investor centre. However we found that only 13% of the sites surveyed provided a clearly labelled case for investment. And while many companies do touch on the subject by including prominent positioning statements (such as Imperial Tobacco’s ‘We’re committed to creating value for our shareholders’) they don’t go far enough. It’s not a case of the hard sell. In the best examples it’s used as a platform for a member of the senior management team to communicate one-to-one with stakeholders. For instance, Aviva feature a clearly signposted and powerful investment case on the homepage and give an overview of the key reasons to invest in the company by the CEO, David Moss.
BP plc ‘Investing in BP’: a key feature of a consistently strong investor centre. It contains all relevant information in one place and acts as a portal to greater detail deeper within the site. The ‘Learn about Investing’ tutorial courses are a particularly useful tool for the retail investor.
BP plc
Also of note: Aviva plc
Aviva
Personalisation Aviva plc ‘Your Page’: the most powerful example of the potential opportunities of Web 2.0 and personalisation. The site allows users to create their own bespoke investor page containing content tailored specifically for their needs. Other features include personal alerts, reading lists, bookmarks, calendar and notes pages.
Online investor centres provide the ideal means to cater for different audiences – private investors, professional and institutional investors, analysts, media, regulatory bodies and government – through the provision of tailored information. Although only 14% of the sites currently provide personalised content there is little doubt that this will increase as Web 2.0 technologies continue to be used. Aviva
The sites using personalisation most effectively contain prominent homepage navigation features to allow different stakeholder groups to find information specifically relevant to them more quickly. For instance, on Centrica’s homepage a button to prompt users ‘What do you want to do?’ gives drop-down options for browsing deeper within the site. Other good examples of effective personalisation can be seen on the homepages of Cadbury Schweppes (‘I’m interested in…’), BT (‘Useful resources & links’) and ICI (‘Right Information For You’).
Cadbury Schweppes ICI
Also of note: BT plc, Cadbury Schweppes plc, Centrica plc
“Innovations are only effective when used appropriately to enhance a stakeholder’s overall experience.”
Usability We found that 79% of sites provided convenient highlights and quick links on the homepage to allow users to navigate to more detailed information quickly. Good examples of this are the intuitive layouts of the Centrica, Imperial Tobacco, Shell and Unilever investor centres. Of interest, 37% of the sites reviewed could not be found via a user-friendly URL (e.g. www.vodafone.com/investor) when entered into a search engine or browser. It’s also essential that online investor centres are accessible to all stakeholders, regardless of their physical or technological capability, and where possible should adhere to W3C WAI’s Web Content Accessibility Guidelines. We were interested to find that 21% of sites do not yet even include a basic accessibility statement. The inclusion of simple tools such as navigation shortcuts, access keys (keyboard shortcuts that replace the need for a mouse) and font resizing for visually impaired users (as seen on the British American Tobacco homepage) ensure company information is accessible for all.
“The most successful sites become portals through which companies can interact with all their stakeholders.” Unilever plc A winning combination of good design, clear content, and simple and effective navigation. Unilever’s investor centre also conforms to a minimum of W3C Level A compliance throughout allowing all stakeholders to extract relevant information quickly and easily. Also of note: Imperial Tobacco plc Unilever
Technology Our research confirms that Web 2.0 technologies and rich media have been enthusiastically employed by the FTSE 100 companies: 69% of sites now contain webcasts, vodcasts or podcasts alongside the more traditional PowerPoint presentations. 46% of sites surveyed also include online tools (either provided by a third-party or embedded within the site) such as the interactive analyst tools provided by Aviva, Cadbury Schweppes and Vodafone. We were interested to see the increasing availability of information via mobile devices as seen on the Aviva, J Sainsbury, Rolls Royce and Shire sites.
BT plc
Vodafone
J Sainsbury
BT plc BT is the only site in the FTSE 100 which uses video on its investor centre homepage to enhance the quality and transparency of its investor relations. Vodafone plc Vodafone’s interactive analyst tool is representative of a general trend and allows shareholders to interact with performance figures in real-time. Also of note: Aviva plc, BP plc
E-communications With amendments to the Companies Act 2006 allowing wider e-communications we were interested to note only 12% of the FTSE 100 actively promoting the benefits of electronic documentation. Where companies do, Centrica’s ‘Electronic Shareholder Communication’ section is representative of the approach taken by highlighting the advantages of the switch in terms of benefit to both the individual shareholder (‘improved efficiency, ease of access and online voting’) and the environment. We would also note the use of incentive schemes such as BT’s online share management services (including prize draws and online portfolio management) or environmental initiatives (such as Scottish & Southern Energy’s tree planting scheme).
Rio Tinto
BT
Rio Tinto plc An effective initiative to incentivise shareholders to receive communications electronically linked with the company’s sustainable development agenda. If users register for the scheme, Rio Tinto buy a sapling to be used in the Woodland Trust’s treeplanting project, which aims to help plant 12 million trees in the UK over the next 5 years. Also of note: BT plc, Centrica plc
For links to all the sites highlighted please visit www.salterbaxter.com/directions19 Methodology: The research is based on a review of FTSE 100 online investor centres. All research was conducted by salterbaxter and every effort has been made to ensure that the data is accurate.
Michael Mitchell General Manager The IR Society
To view the IR Society’s Best Practice website guidelines please visit www.irbestpractice.org
Making best use of online communications When the Investor Relations Society first introduced its Best Practice guidelines, websites were still regarded with some suspicion as an investor communications tool. We wanted to encourage companies to use the new medium to best effect and therefore we developed the guidelines as a way of encouraging this. Today the website is the first port of call for most investors and analysts and it is absolutely essential that companies keep up to date with the opportunities that developments in the design and capabilities of the internet present. A company’s website is now its shop window to the outside world. The look and feel of the site reflects directly on the company. In the 2007 Best Practice Awards, the judges were impressed by the increasing breadth and depth of information held in the investor relations sections of entrants websites – particularly in small FTSE and AIM listed companies – but somewhat disappointed that
the presentation of online annual reports had made little progress on the previous year. There was a feeling that companies were waiting to see what the next moves should be, particularly in respect of the new e-communications requirements introduced by the Companies Act 2006. It is interesting to see from this survey that the majority of companies have still to develop their e-comms policies.
We expect to see continued innovative use of websites to communicate with existing stakeholders and potential investors next year and anticipate considerable improvement in online annual reporting. To this end we are revising and updating our best practice guidelines and these will form the basis of the awards for 2008 which will be announced in November. Whilst we will be looking at how companies make best use of technology, including interactive tools such as webcasts and podcasts, we will not be neglecting the requirements for excellent communication of those aspects which time and again the users of accounts say they are looking for – namely strategy, outlook and the link between performance and directors’ remuneration. With the increase in the amount of potential information which companies may wish to disclose online, we will also be looking for clarity in the content and structure of such communications. The IR Society welcomes this review as a very useful contribution to the continued development of online communications.
“ Today the website is the first port of call for most investors and analysts.”
Turnover to see salterbaxter’s pick of the best in class features of FTSE 100 online investor centres.
About us Salterbaxter advise companies on strategy, branding, corporate communications and design. Contact: Lucie Harrild [email protected] Tel: +44 (0)20 7229 5720 Pavan Athwal [email protected] Tel: +44 (0)20 7229 5720
The Directions Supplements support our main Directions report and are produced every two months. The main Directions report is published each year and is now regarded as the UK’s most comprehensive analysis of the trends and issues in CR communications. If you want a copy, call us on the number below or email [email protected]
202 Kensington Church Street London W8 4DP Tel +44 (0)20 7229 5720 Fax +44 (0)20 7229 5721 www.salterbaxter.com
This supplement is printed on Think Bright and is supplied by Howard Smith. It is an FSC (Forest Stewardship Council) certified material and is 100% recyclable. www.hspg.com Printed by CTD, an ISO 14001 certified and FSC accredited company. TT-COC-2142 ©1996 Forest Stewardship Council A.C www.ctdprinters.com
Our clients are extremely varied and include FTSE 100 companies; some of the world’s most exclusive brands; independent, entrepreneurial businesses; world-leading educational establishments; law firms; private equity firms and media companies. We name companies, re-invent companies and re-position companies. We help companies communicate with shareholders and advise them on how to address corporate responsibility. We launch, brand and re-brand. A key area of our expertise is corporate reporting and we advise leading UK and European organisations on strategy and design for their financial and CR communications programmes.
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