In his 3rd quarter issue of the “Shareholder Service Optimizer,” Carl Hagberg devotes his lead piece to our most recent “Transparency Awards” and urges us all to be more transparent in our disclosures. In addition to listing the winners of the various Awards, Carl provides these transparency tips of his own:
1. Be sure to review the 2024 Proxy materials of your peer companies – against which your own company is certain to be compared. Start with any “transparency winners” of course but focus special attention on peer companies with “issues” – and on how well, or badly, they handled them in their materials. (We were amazed by how many “winners” actually HAD fairly serious issues – which rightly motivated them to work harder to identify them and to address them proactively – in a robust and far more ‘transparent’ manner.)
2. Try to identify non-peer-companies too that you consider to be “best in class” on an overall basis and review their materials as well – to see exactly WHY and HOW they are “best-in-class.”
3. Consider using editorial software-aids midway through the drafting process and before signing off on the final version to flag sentences that may be too long, and too complex, too “wordy” or too “legalistic” – and maybe to aim for a 12th grade reading level, or, perhaps, a bit lower.
4. Consider asking one or two “regular” staff members – non-lawyers – to read through next-to-final drafts to identify passages that are not clear to them as non “financial” or “legal” experts, as most of your drafters are and as many of your readers may not be.
5. Pay special attention to “the human touch” (or, heaven forbid, a lack thereof) which is so often lost in minutia and legal gobbledygook if it is there at all, but which is so much appreciated by readers. (Our own 2024 favorite on this score was JPMorgan Chase’s AR, which was entitled “Powering Growth With Curiosity and Heart”: A masterpiece of Plain English that made complex issues understandable, and relatable, made you want to read on, and convinced you that JPM Chase really does have a heart.)
