Sometimes more is less!

Frank Buytendijk at Gartner reminds us that sometimes more corporate regulations lead to less (not more) corporate transparency:

Royal Dutch/Shell Oil yesterday announced its annual results. It also decided not to report predictions anymore on future oil production and on anticipated return on average capital employed. Although that’s valuable information, the company decided to stop the practice because while the predictions come true in the long term (or so they claim), on an annual basis, they were too “volatile.”

I think there have been many examples the last six months of CEOs, accompanied by their chief corporate counsel, disclosing less nonfinancial information instead of more. I’m currently in a fact-finding mode to see a pattern exists. According to this article in CFO magazine, a survey of 600 investor-relations executives revealed that nearly a third said their employers are considering ending the practice of offering profit projections to Wall Street analysts. Stay tuned