African Investor Relations

I was doing some research into the banking sector in Malawi and had to download the National Bank of Malawi 2007 annual report. A cool 198mb of it, which took a few hours and I have a relatively fast link. The 2010 annual report is posted online in Quark Express – a format that no ordinary person can view without the software which costs a few thousand US$.

National Bank is Malawi’s largest bank and a very strong brand there. It’s a public company and part of the Press Corporation Group, Malawi’s largest conglomerate, also listed on the Malawi Stock Exchange and the London Stock Exchange.

One would think that a dominant bank, with a dominant brand in a dominant group would be keen to accentuate its dominance but it’s bible: the annual report, is accessible only to the most hardened researcher desperate for data. Just trying to get into their website now I have failed.

Malawi is not in a good state politically or economically at the moment and according to www.Internetworldstats.com there are 716,000 internet users there. So is the internet just not worth taking seriously because Malawi is a poor country and no-one uses the Internet? Or is it a case of the Internet is an ideal place to target people with the disposable income and demographic profile with a view to selling them banking and financial services? It’s the latter.

National Bank probably thinks that they have enough day to day interaction with their clients in any event and they do not have to take the Internet seriously. Well NBM’s share of listed banks (Stanbic, FMB) profits has fallen from 63% of total profits in 2005 to 44% in 2010 so one would think that the group would use all available means to reach out to customers and investors. The integrated online communications models of the current day means that you can’t or shouldn’t view an investor as an investor, or a customer as a customer. They are, I dare to say, “stakeholders”. They are everything all in one and a corporate website should be structured to take this into account.

In any modern day corporate strategy the Internet should be a core pillar of marketing and investor outreach. There is one reason that is 100% defensible in this regard. The cost: benefit ratio makes it worthwhile for any company actually.

So posting Quark Express documents and 198mb annual reports is just not on. It’s the basics that African listed companies need to sort out and this isn’t difficult. The absence of annual reports on www.africanfinancials.com is evidence of Africa’s ignorance in dealing with the basics of investor relations and National Bank is an example of part of what’s wrong. Malawi is a country where the Internet should be taken more seriously because of the commercial benefits.

THERE IS AN OPTIMISE PDF FUNCTION IN ADOBE SOFTWARE TO ENABLE LARGE PDFS TO BE CONVERTED INTO SMALLER, EASIER TO USE FILES

 

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In his article on the length of time spent on annual reports Dominic Jones says that “WEB traffic statistics compiled by Google show that investors are spending less than 5 minutes viewing annual meeting materials hosted by large vendors – and younger investors are almost entirely ignoring the documents.”

Running an online business in Africa where internet penetration is very low relative to the rest of the World I am constantly having to battle the issue of low website traffic – is it bad? Well as I say to my clients it just takes one investor to change the fortunes of a company. Another corollary is what if you had a website with only one visitor a day and that visitor was Barack Obama? Traffic wouldn’t count wouldn’t it? ( I wonder what website he does visit everyday).

So the issue is quality and not quantity and because visits to corporate websites are typically not conditional upon registration access to information is free and readily available. So one has to roll out the red carpet and assume that Barack or Mark Mobius is actually going to visit the site. This is especially true in investor relations in Africa.

Here’s my response to Dominic’s article above:-

I don’t see the low usage statistics of proxy materials or annual reports as an issue. Having a legal requirement to prepare an annual report is key part of governance. It’s a key part of strategic marketing too. The fact that it is not used or read is irrelevant – people are busy. Companies have a moral and legal obligation to prepare their annual reports in differing formats and media to ensure it is available at any time as a transparent mechanism of disclosure that’s widely available, if needed.  Is the preparation of online annual reports a waste of time? The fact that retail investors on average don’t read them for a long time, hides the fact that some investors, the ones that count ie the top institutional investors, may spend a long time reading them. Perhaps “who” reads the annual report and the number of times an annual report is viewed, provides more insight as to its usefulness (from a governance and marketing perspective respectively) given that annual reports serves so many purposes.

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Zimbabwe has 74 listed companies and a well established printing industry and many design professionals that are well versed in designing annual reports. Another plus is there are a few individuals well versed in writing your annual report and project managing the whole process.

Costs of printing in Malawi or Zambia or Botswana can be extraordinarily high and there appears to be a cheaper option to get your annual report printed in Zimbabwe. But there are pitfalls. This blog provides a brief overview of the issues that you need to consider if you do want to get your annual report printed in Zimbabwe. My references to Malawi below may also refer to Botswana and Zambia as the case may be.

• Obviously you need the foreign exchange to pay the printers and designers and approval to pay. Generally printers will charge 30% up front and then require payment upon shipment. This latter point has another side to it and that’s that RBM (Reserve Bank of Malawi) needs proof of the goods coming into the country before the bank is able to pay. So don’t think about cheating on any of the forms about quantities and values and ensure that the Zimbabwean printing company gives you credit.

• Navigating your way around the customs duties gets more and more complicated the more people you speak to. So don’t speak to many people. Annual reports are “printed” material, “not for resale” and have “no commercial value” and so putting them on the airplane or truck from Harare to Lilongwe is hassle free, so long as this is repeated often. Ensure that the boxes are labelled “annual reports” “for shareholders”, “not for resale” and have “no commercial value”. If anyone tells you otherwise, ignore them.

• Air Malawi charges about US$1.5 per kg air freight and 1000 average length annual reports including boxes will weight about 80kg. At National Handling Services,at the Harare International Airport, incredibly friendly staff (George) will use a typewriter, yes a typewriter, to type out your waybill accurately after you complete the Shippers Instructions for Despatch of Goods form. The latter form must state that the goods are not for resale and have no commercial value (repeated again). So your annual reports can be shipped as unaccompanied cargo to Lilongwe or Blantyre direct. One small snag is that you will need the shipment and the invoice stamped by the Malawian customs people for RBM purposes.

• The Zimbabwe Government revenue authorities will charge VAT on the printing even though it’s for export. Because they can. Apparently it is possible to claim this back but I suspect that many barriers will be put in place to ensure that you can’t. If I find out any more about this I will update the blog.

• Using DHL or a similar service to ship you annual reports to Malawi is also an option. BUT I strongly recommend striking up a relationship with an individual in DHL to explain what is happening. Both ways. You explain to them the latest with what’s happening at the printers and collection info – and they explain to you when, where and how they will get the reports to Malawi. They work over the weekends and have a number of options available to them. That said, my experience indicates that someone outside of DHL or your printer MUST project manage the courier and despatch process on a minutiae basis, because unless you see the bigger picture, the smallest detail can de-rail the process.DHL, whilst being a reliable courier service may not be in the loop regarding the last minute issues that are flying around between the printer and the company or the agent project managing the printing process.

• It’s important to ask DHL whether the shipment is going on a commercial Ndege or DHL Ndege. The former has the risk of the Captain removing the load if the plane is too heavy – at his full discretion i.e there is never 100% assurance of delivery on a commercial flight.

• The advantage of using Zimbabwe is that it is a days drive away from Malawi and there are a few Air Malawi flights a week, albeit unreliable ones. My point is that many plans can be made to get the annual reports to Malawi if things go wrong. So long as you stick to your timetable.

• A warning about not sticking to your printing timetable. As you well know printers are at the end of YOUR chaotic timetable and project management process (if you can call it that) and so they take all the flak. They will likely add 20% onto the bill to compensate them for the hassle of you missing your timetabled printing time. Bear this in mind when doing your budget.

• How much do Zimbabwean printers charge? You know, it’s kind of irrelevant. For a listed company its reliability and quality of print that is key. Your annual report is your company’s bible so don’t skimp. Nevertheless, for a good quality annual report 1,000 copies may cost anywhere between US$10,000 and US$14,000 and take 2 – 3 days to produce.

• If these annual reports are to be posted to shareholders in Malawi or distributed in different areas, then I strongly recommend that the sorting into batches to be posted overseas, or regionally, by postal code, happens at the printers. You do not want the hassle of resorting all of the annual reports in your administration office as soon as they arrive. By then your timetable is so blasted out of the water anyway that you can’t afford the hassle.

• So my key piece of advice is to provide plenty of time to get the annual reports to Malawi because each successive deadline that falls by the way side and each successive redundancy initiative that collapses, needs to be backed up by another one. If you know, or suspect, that your company will not stick to the timetable and project management associated with finalising your annual report, then use an outside consultant because they are not distracted by day to day management issues and they can shout at you when you are distracted.

Is it worth it? A few pointers:-

1. - if you are a Malawian company already printing in South Africa – its probably worth it
2. - if you are not happy with the quality of design work or the quality of printing its probably worth it
3. - if you need assistance in writing your annual report then its probably worth it
4. - if foreign exchange is not sacred to you then its probably worth it

I have written another blog about the pitfalls of writing your annual report which you may find interesting and entertaining.

African Is Cool offers annual report writing and annual report project management services. Our online annual report service is a highly professional alternative method to delivering annual reports in hardcopy as reports are delivered on mini CD. Here are 3500 annual reports that appear in electronic format – this same format can be published onto CD.

We also design, host and manage corporate websites on an ongoing basis . Here are our clients.

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We have now published the annual reports of each of the African stock exchanges on www.africanfinancials.com. Actually, only 7 of the 19 African markets have their annual report published online (don’t ask about Nigeria). Only 6 of the 19 African stock exchanges have an up to date annual report on their website. Here are the offending stock exchanges:-

Dar es Salaam Stock Exchange BRVM (Ivory Coast) Zimbabwe Stock Exchange Lusaka Stock Exchange Malawi Stock Exchange Nigerian Stock Exchange Casablanca Swaziland Stock Exchange Ghana Stock Exchange Bourse de Tunis Bourse d’Alger(Algeria) Egypt Bolsa de(Mocambique)

Putting these annual reports online is our way of giving a message to the stock exchanges to get their a-into-g in using the Internet and to set the standard for listed companies to follow. Here are the links to the annual reports of the various African countries whose stock exchanges have published up to date annual reports online:-

Botswana

Kenya

Mauritius

Namibia

South Africa

Uganda

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We have a baby in our organisation called Africanfinancials.com. We love this baby and cherish it. We only feed it once a week (with annual reports) and that’s generally enough. She grows and grows and gets cuter by the day. And then we love her more.

A lot of people visit her every month (over 7,000) and they look at her over 24,000 times – she’s cute you see and very interesting. And very famous because people visit from over 120 countries, every month.

She wears designer apparel – our listed companies clients – the ones that live in the same neighbourhood – the internet – and these “brands” do well to be associated with her. Because some of those that visit our baby also visit the places that the “designer apparel” is resident. Our clients are a bit like a Tag Heuer watch on David Beckham.

The good news is that she is about to be visited by another neighbourhood soon – the one called the mobile phone neighbourhood. Every person accessing the internet with their phone can now visit africanfinancials.com and see what she has to offer.

In short www.africanfinancials.com is now mobile enabled adding to the visibility of african listed companies globally. And we are proud.

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Electrolux have been awarded the best annual report in the World for 2010 by Reportwatch by e.com.

Their top 2010 annual reports were rated according to the following rating parameters:-

They key thing for me is that this process is almost global and free. Most “award” initiatives entail the payment of a fee by the listed company that serves as a revenue generating project for the sponsors / appraisers. Africa needs a different approach, one that puts the objective of transparent reporting and one that rewards excellence above the need to charge companies. E.com has done it why can’t someone do this for Africa?

Reportwatch has its weaknesses in that not all annual reports might be appraised, but 1,000 – 1,500 assessments globally is high and would be sure to capture the best in the World.

The space for African annual reports awards is open for someone to come in and improve reporting. Structured correctly an initiative such as this in Africa would have tremendous indirect benefits to sponsors. But commercially who could justify this? Not a lot of companies. The big accounting firms? Regional securities organisations have a vested interest in this. The African Stock Exchanges Association in association with a donor / grant funding related to governance. The absence of an initiative of this nature in Africa points to the following:-

• absence of regulatory regimes co-operating with each other across Africa
• absence of awareness at director level of the importance of the annual report
• perceived absence of commercial opportunity

Who created the Reportwatch appraisals?

“The two “generators” of the idea were Vero Escarmelle (a marketing and communication consultant) and Mike Guillaume (an economist and financial specialist). Both were heavy users of reports in their consulting practice (“Volvo, Philips, Saint-Gobain, Canadian banks and a few U.S. industrials were among the references regarding content at that time,” remembers Mike) and had an inside experience through the coordination of annual reports for financial institutions. After the spin-off of the reporting unit renamed enterprise.com (or e.com) in 1999, the Annual Report on Annual Reports became a trademark of e.com.”

Annual report appraisals look for and benchmark best practice in order to strive for higher -and highest- standards in financial and performance reporting, investor and stakeholder information, and corporate communication. The longer term advantage is that richer report content, higher report value, better access to company information decreases the cost of capital. Mmmmmm… can this really be motivated in illiquid African markets where no empirical evidence exists?

e.com provides annual report benchmarking services comprising report evaluation tools and reporting assessment services to help companies report better or best, on paper and online. The bottom lines in any report should:

• Mirror company value
• Show investor value
• Enhance report value
• Increase stakeholder value

e.com are quick to point out that the ranking and score are based on an evaluation of the company report and output and cannot be interpreted as such as an assessment or rating of the company that releases the report. However investors are able to infer some opinions and decisions based on report content:-

Robert J. Samuelson once wrote, “Annual reports often tell us more than their authors know or intend.” (Newsweek, April 21, 1997).

“Even though a relationship may be found -or argued- between company, report and shareholder value, mind the deductions! Enron used to produce a decent annual report before its collapse, while a market leader such as Microsoft, among many, has never been capable of publishing an attractive one (even online).Good performance and even less company size don’t necessarily translate into good reports. “

Their services can compare annual reports with peers, best practices and For a complete list of services go to www.reportwatch.net/e-com/making-reports-pay-off

I am sure there is a business model that can be applied for African markets to showcase good annual reports appraised on say basic parameters to start off with. The global audience this would attract would justify the expense.

Africanfinancials.com would be the first place to assess Africa’s online annual reports offerings.

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Over 63,000 annual reports were viewed by over 24,000 individual website users on www.africanfinancials.com in the past three months. Traffic to Africanfinancials.com has grown exponentially since 2007 when the portal was launched:-

Africanfinancials.com was established in 2007 by African Is Cool, to enable online viewing of annual reports by sector, year or country, as a free service to the users of financial information / annual reports in Africa. This is also a free service to listed companies who are able to send us their annual reports for scanning and publication online. This has now evolved into a useful tool for the many thousands of users of financial information on African markets and we want to take this to the next level.

Sponsorship funds raised will enable AIC to invest in procuring timely publication of more annual reports online for the benefit of African capital markets and investors alike.

Freely available information increases the investment message outreach of African companies, reduces systemic market risk and increases transparency. Noble objectives for corporate sponsors.

Recent traffic statistics for the past three months reveal the following:-

• No of countries visiting the portal      140
• Average time on site                                 4 minutes and 14 seconds
• No of annual reports viewed                  67,154
• No of individual visitors                          22,025
• Top country visitors                                 Nigeria, Kenya, USA, UK, Ghana, India, Egypt

Africanfinancials.com displays African annual reports online by year, sector and country and a weekly alert is sent to over 800 contacts that have requested notification of new publications of annual reports online. The significant traffic visiting africanfinancials.com provides sponsors with a unique opportunity to target their brand and corporate message to specific users of African financial information.

African Is Cool seeks the following sponsors for the portal:-

• “Master” sponsor: a single pan African corporate sponsor. The objective of this sponsorship is to increase transparency and promote informed investment into African markets.
• “Sector” sponsors for the following categories:-
  • “African banking”: the sponsor’s logo and message will appear in annual reports, publications and banking sector reports in which any African banking organisation appears. Africanfinancials.com greatest country traffic comes from Nigeria so any sponsor here would ideally seek exposure to or be  dominant in Nigeria.
  • “African construction”: the sponsor’s logo and message will appear in annual reports, publications and construction sector reports in which any African construction organisation appears.
  • “African beer”:- the sponsor’s logo and message will appear in annual reports, publications and banking sector reports in which any African beer or beverage organisation appears. Africanfinancials.com greatest country traffic comes from Nigeria so any sponsor here would ideally seek exposure to, or be dominant in, Nigeria.
  • “African telecommunications”: – the sponsor’s logo and message will appear in annual reports, publications and banking sector reports in which any African banking organisation appears. Africanfinancials.com greatest country traffic comes from Nigeria so any sponsor here would ideally seek exposure to or be  dominant in Nigeria-
  • “Country” sponsors for the following countries are also sought:-
    • Nigeria – a country sponsor for all Nigerian annual reports viewed online
    • Ghana – a country sponsor for all Ghanaian annual reports viewed online
    • Kenya – a country sponsor for all Kenyan annual reports viewed online
    • Zimbabwe – a country sponsor for all Zimbabwean annual reports viewed online
    • South Africa – a country sponsor for all South African annual reports viewed online

Note that there are other “Sectors” and “Countries” to sponsor besides the sectors and countries indicated above.

The electronic format of the annual reports (ipaper) provide unique opportunities to embed sponsors’ brands and corporate messages online. The professional html email distribution service which, at the current level of registrants, provides sponsors with significant targeted exposure of their brand, is again an ideal marketing tool especially if this platform is used to provide specific sectoral or country alerts.

A key attribute of the sponsorship of africanfinancials.com is that sponsors know that they are targeting users of financial information in African capital markets. These users include investors (retail and institutional), analysts, data vendors, research professionals and research academics (a growing area of users using the ease of access to data for academic purposes).

If your organisation has pan-African outreach, has, or wishes to market its brand to users of Nigerian financial information (a significant area of online activity) and other African financial data then you should consider seriously the sponsorship opportunity provided by Africanfinancials.com. Call me on + 263 4 850735 or send me an email on ceo@africaniscool.com for more information.

Go to africanfinancials.com

Sign up to the africanfinancials.com alerts section

Go to Africanfinancials.com twitter account

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The Nigerian SEC website announces

“It is with great pleasure that I forward to you, the Annual Report and Accounts of the Securities and Exchange Commission for the year 2008″

and then provides a link to a document which provides a myriad of market statistics in the form of an annual report. The report refers to the annual accounts on page 57 which do not appear on page 57 or anywhere else. The statement immediately below the announcement of the availability of the SEC’s annual report and accounts states:-

“This is to remind the under listed Public Quoted companies and others who may not have been listed but have their financial year end as December 31st and whose securities are traded on the floor of the Nigerian Stock Exchange that they are due to publish their quarterly financial reports and file same with the Commission on or before 30th April 2010″

The Nigerian SEC’s Vision Statement is to be “Africa’s leading capital market’s regulator”.

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This notice appeared from Pioneer Africa in the Zimbabwean press today – see below. Here are a few observations:-

- THE ANNUAL REPORT IS NOT ONLINE AS AT THE DATE OF THIS ANNOUNCEMENT – IT IS ONLY THE ABRIDGED ANNUAL REPORT THAT IS – NO PROXY VOTING MATERIAL EITHER – a few more days and shareholders will be able to claim that proper notice was not given

- This notice obviously has the sanction of the ZSE but no mention is made of this

- The notice in the hardcopy press advert does not appear on the website

- There is no mention of why the annual report was not sent – presumably because the company can’t afford it?

- There is no explanation of the threshold of shareholder votes required to approve the waiver of the receipt of the hardcopy annual report – is it 75% of the votes (in which case a majority shareholder could unilaterally deny minority shareholders) or 75% of the shareholders by number? Or 75% of the number or votes in attendance at the meeting – usually the quorum at an AGM is just a few shareholders

- is putting the annual report on the website enough? Do Directors have an obligation in terms of good corporate governance to make available to shareholders the annual report?

- proxy forms are available at the Head office but not on the website – shareholders have to collect these forms and then forward them to the Company Secretary – if the annual report can be put online why not the shareholder proxy forms? The shareholders that are asked to waive their right to receive hardcopy annual reports

- are the directors reasonably sure that all of their shareholders have a reasonable chance of receiving their shareholder voting material? How can a shareholder vote on something if the voting material is not sent to them. Surely the logical thing to do, assuming that this initiative is legal, is to send all of the hardcopy announcements of the company’s intention to be carried out in the following year.

- How many contact email addresses does Pioneer Africa have of its shareholders? What initiatives has it taken to ensure that the voting material – the stuff that all shareholders are entitled to – is sent to shareholders?

- There is no corporate governance section on the Pioneer Africa website. The 2008 annual report (since the 2009 one is not online) says that the Board endorses the King II Code of corporate governance……mmmmmm…..

- S149 of the Companies Act requires that the balance sheet etc. “be sent to all persons entitled to receive notices” – the penalty if this is not done? s149 (3) of the act says ” If default is made in complying with subsection 1 the company and every officer of the company who is in default shall be guilty of an offence and liable to a fine not exceeding one hundred dollars……….gasp.

- so why havent other companies done this previously?

- which is more or less excusable? Denying the shareholders a reasonable right to receive their voting material or denying them the right to receive the annual report?

- forgetting the bigger picture issue here – if the annual report does not get published in the next day or so the clear 21 day notice period will have been breached – so what? You may ask.

This is a good example of the ignorance of directors when it comes to their obligations associated with shareholder communications. The IOD Zimbabwe and other institutions have high-flying-fluffy-puffy corporate events and training sessions where the oft-stated cliches of progressive corporate governance etc are stated over and over again to a sleeping audience. There should be hands on practical training sessions showing how executives can use the web effectively to communicate with shareholders, interactive sessions with legislators to come up with ways of solving the issues facing Zimbabwe

I hope this does not set a dangerous trend. Pioneer Africa is not a Safaricom and does not have the ability to significantly influence the regulators in turning a blind eye to corporate governance principles that have evolved from the South Sea Bubble days.

Dominic Jones , a world leader in online investor relations, has this opinion about the trends in African markets regarding de-linking the direct communications channel with shareholders:

“Scrapping requirements for companies to mail printed disclosure documents to investors is a global trend, but it has exacerbated shareholder apathy in every jurisdiction where it has been implemented. This is largely because regulators have failed to replace printed disclosures with suitable standards of online disclosures. Apathy and an uniformed investing public is, to my mind, the single worst thing that can happen in any market. It ultimately will lead to market abuses.”

Globally intellectual debate about the end of “shareholder value maximisation” has come to the fore. A recent article in the Economist highlights that “stakeholder values” are emerging as the core objectives of management.

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Kenyan legislators, in their bold quest to demand accountability from listed company directors, wish to punish directors with a jail term of up to 6 months and or a fine should the annual report not be published online in accordance with the requirements of section 387 of the new Companies Bill. One legislator though, nervous at this particularly draconian move, quickly slipped in section 389 below.

A failure to make information available on a website throughout the period referred to in subsection (4)(b) is disregarded if—
(a) the information is made available on the website for part of that period, and
(b) the failure is wholly attributable to circumstances that it would not be reasonable to have expected the company to prevent or avoid.

So that makes sense: if a listed company is unable to post the annual report online because of circumstances beyond its control then the directors have a “get out of jail free card”. The following general implications arise from Kenya’s news legislation:-

- all listed companies in Kenya should have a website (Kenya has the highest incidence of listed company corporate websites) up and running all the time
- the publication of information on their website requires discipline in the financial reporting process – the obligation to post information online as soon as it is practically available creates an obligation on someone to think about what they are doing
- control over the availability of information online will have to be increased to ensure that reporting requirements are not inadvertently contradicted

I have spoken to numerous listed company executives in Kenya and the level of awareness of the issues contained in the new Companies Bill is very low, if not non-existent.

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The extract below is from the new Kenyan Companies Bill that makes interesting reading from in investor relations perspective. We will be covering more of this in later posts but here’s one issue that’s bound to get the attention of executives of Kenyan listed companies: jail sentences and or a fine for not publishing an annual report on the corporate website:-

387 Quoted companies: annual financial statements to be made available on
website
(1) A quoted company must ensure that its annual financial statements and reports—
(a) are made available on a website, and
(b) remain so available until the annual financial statements for the company’s next financial year are made available in accordance with this section.

(2) The provisions of section 389 (requirements as to website availability) apply.

(3) In the event of default in complying with this section (or with the requirements of section 389 as it applies for the purposes of this section), an offence is committed by every officer of the company who is in default.

(4) A person guilty of an offence under subsection (3) is liable on conviction to a fine not exceeding 50,000 shilling or to imprisonment for a term not exceeding six months or both.

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We believe that listed companies have now been required by the ZSE to prepare hard copy annual reports for all shareholders. The question of cost now comes to the fore given that there are thousands of shareholders whose shareholdings are of insignificant value (penny stocks). The practical focus should be how listed companies can reduce their shareholder bases significantly to avoid the costs of preparing annual reports. There has to be some form of share buy back solution specifically to make shareholders meaningful again.

Is it all really about cost? Isn’t the annual report a marketing document too? Isn’t business tough in Zimbabwe at the moment? The fact is that no-one has information on how much it costs to prepare annual reports in  hardcopy. If you want to share this information with us we will aggregate all the data we have, without disclosing names and let you know whether this is the issue that everyone thinks it is. Tell us how many shareholders you have and the total cost of your annual report per annum here .

Zimbabwe is at a crossroads in its securities legislation and corporate governance – a new code will be released by the end of the year. Now is the time to start looking at using electronic shareholder communications within a framework of corporate governance and the law. The solution is to provide investor choice and there is ample evidence elsewhere on how to slowly wean ourselves off hardcopy communications.

Click here to track internet use in Zimbabwe and other countries (you will need an internet connection). Or just read the document attached herein see below.

Remember all shareholders have to be treated equally. Companies can’t only have 10 institutional shareholders and still be listed.  If companies view them as an asset then the question is how to use the relationship to better advantage. This advantage may be in corporate reputation, commercial return, brand enhancement. Each listed company will have its own story. Every company has a story. You may not think it does, but it does.

When the obligation to send hard copy communications is dropped, an alternative communications governance model has to be adopted. The Internet can be an important cog in this wheel. The fact is no one channel of communications is perfect. Directors should use whatever tools they have available to them. Hardcopy, electronic and the Internet. You can’t ask shareholders to vote on a proxy card without giving him the information to make a decision on which he is voting. The issues are complex.

In Zimbabwe, the regulatory environment has been unclear and its up to companies to adopt a new communications governance model in consultation with legislators and regulators. Fat chance. There needs to be a culture of co-operation and like minded concern. This does not exist because everyone is so apathetic.

The attached paper outlines what an alternative communications governance model might look like. Read it here online here or download it here and send me your feedback. Zimbabwe is formulating a new corporate governance code and its precisely these issues that need to be addressed.

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