Pressure on IR Execs in Wake of Disaster

“Corporate leaders are certainly under the gun to evaluate the potential impact of this week’s tragic events on the companies they run,” said Donni Case, president of The Financial Relations Board, a unit of BSMG Worldwide, at a panel discussion sponsored by the two firms. “This is creating pressure to disclose details to investors, but extreme thought and care is required under what is clearly a unique set of circumstances.”

Specific advice includes:

        Remember disclosure laws. Regulation FD, which requires that material financial information be released to the public simultaneously with disclosure to major investors and analysts, remains in force.

        Avoid speculation. “It is critical that management avoid speculation in situations where it is too early to tell what the effects may be on your company,” Case said.

        Adhere to regularly scheduled earnings announcements.

        Involve sell-side analysts. The panel noted that companies are likely to receive many inquiries from analysts in the wake of the disaster, and must be mindful of selective disclosure. But analysts can play an important role in communicating to investors and help the market digest information that has been duly disclosed.