Should Boards Worry About a ‘Fifth Analyst Call’ for Investors?

by Gary Larkin for The Conference Board – Governance Center Blog, April 14th, 2011.

In what is probably one of the most-anticipated conference call in Occidental Petroleum’s long history, some key institutional investors will get a unique opportunity April 26 to discuss key issues brought up in the proxy statement. Known unofficially as a “fifth analyst call,” United Kingdom-based F&C Asset Management plans to host the call with institutional investors and key members of the board and management to discuss corporate governance issues.

F&C Asset Management in conjunction with fellow UK investor Railpen Investments introduced the idea of the fifth analyst call earlier this year in a joint statement from Deborah Gilshan, corporate governance counsel at Railpen, and Elizabeth McGeveran, senior vice president at F&C, that was made available to the Harvard Law School Forum on Corporate Governance and Financial Regulation.

They describe the call the following way:

“We would like to introduce a forum where investors can pose thoughtful questions and challenges, and hear directors’ views that are not filtered by management or by proxy advisory firms. The ‘Fifth Analyst Call’ would also serve as an efficient mechanism for issuers to reach beyond the handful of their largest investors to their broader investor base. A recorded call is easily posted on the company’s website for wider market access.”

Another group of global institutional investors that include T. Rowe Price and Walden Asset Management also called for a similar forum back in February, according to a client memo from Foley & Lardner. That memo explains how the call got its moniker: the call would be similar to the four quarterly earnings calls, except that it would be held just before the annual meeting. “The call would follow the public filing of the company’s proxy statement for the annual shareholders meeting, but would precede the meeting by 10 to 15 business days,” the Foley & Lardner memo states. (continue reading… )

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