Annual reports and quarterly statements are becoming increasingly expensive to produce; some astute companies are mitigating this expense by effectively using these mandatory documents as marketing communications that could build loyalty.
Companies are unable to avoid or reduce the expense of producing financial reports and statements on a regular basis; in fact they are set to become even more expensive as time passes. In the wake of the Sarbanes-Oxley Act (SOX), the EU has promised the introduction of a European equivalent to SOX within the next few years, following the revelations at Parmalat. The tightening of company reporting standards, which will include greater transparency and increased director responsibility, will inevitably inflate the cost even more.
However, there is another way of tackling the problem: these documents are likely to be studied by most investors, so why not use them for communicating key marketing messages as well as the facts and figures that they contain?
Compulsory touch point
Recent research by communications specialist, Corporate Mailing Group, has revealed that more than one in four of the UK's top 1000 companies are effectively doing just that. The more astute companies are realising that a great deal more can be achieved through financial reporting, in spite of this mandatory budget expansion. These companies are looking at their financial reporting requirements and examining whether this touch point with investors could be better used for communicating key marketing messages.
According to Yolanda Noble, Chief Executive of Corporate Mailing Group: "The finding that 73% of companies do not manage to perform this integration successfully is a cause for concern amongst UK listed companies. A company's annual and quarterly reports are regarded by important influencers as so much more than simple financial reports. City sentiment, the press, competitors, supplier and distributor networks, and the general public all use financial, interim and quarterly reports as a barometer of company fortunes and futures. Technology which can help deliver appropriate messages to different shareholder groups is readily available nowadays, so no company can really plead an inability to segment and target investor communications."