Pre-briefing rules of thumb for public companies

07 July 2008


It’s always a good idea to pre-brief industry analysts on company news right? Pre-briefings are one of the most powerful tools analyst relations professionals have for driving real influence. It’s an AR maxim: Tell ‘em early, tell ‘em often, make friends and get ‘em to say nice things about you – preferably to their buy-side clients.


However, some clients have demonstrated a powerful reluctance to talk to third parties about anything before the news release crosses the wire – even under a non-disclosure agreement. As executives at public companies they have been trained to be hyper-sensitive to regulations surrounding fair disclosure and rather than risk crossing their lawyers they write off the potential benefits of the pre-briefing.


Clearly this is not a best practice and as strategic counselors it’s our job to pull them back from that position, but it’s important to note that they aren’t always wrong. Do you want to involve analysts early about the next product release? Absolutely. What about the announcement of a significant customer win or a new partnership? Yes, again. But what about M&A activity? Or a change in the company’s executive leadership? The more material the news, the more caution needs to be taken when considering who you invite into your tent, if anyone at all.


Generally speaking there are a lot of good reasons to pre-brief: on the PR side, you have an informed third-party source of comment for journalists and possibly even a quote for the press release, while the pure AR benefits include a closer relationship with analysts who are influential in your market. After all, analysts trade in knowledge. Providing them with the kind of information that will help inform their advice to clients can only help them. The closer you are, the more comfortable they are going to be about recommending and short-listing your company. Plus, they can ask questions and provide feedback that may help you position yourself most advantageously or avoid a pitfall or two when you do cross the wire.


But anytime you tell someone a secret, you run a risk leading us to another analyst relations maxim: Never disclose anything to an analyst that could cause material damage to your business. The aforementioned M&A activity, for example, is incredibly sensitive. While the overwhelming majority of analysts hold to their NDAs and vows of confidentiality like Indiana Jones does his favorite hat, there are a few exceptions out there that make the rule.


So what about those pesky NDAs? The whole subject of non-disclosure is a sensitive one, especially with your top-tier analysts at Gartner, Forrester, IDC and one or two other firms. If you’re a client, you probably have a standard NDA as part of your service level agreement, but you still need to tell the analyst you are talking confidentially and this is where you need to approach with some sensitivity. Most top tier analysts will flat out refuse to sign a special NDA and by asking you risk damaging your relationship with them. A couple of years ago one vendor tried this at an analyst day, only to have the attendees from a top firm walk out.


Exception: If you engage Gartner – or Forrester, IDC, Yankee, etc – to do a consulting project before making a material business decision (tearing the covers off an M&A target, for example) then they will expect to sign an NDA, but this is not related to a pre-briefing.


The lower tier analysts are a different crowd altogether and they won’t care about your NDA and will sign whatever you want. They are used to this and understand the reasons. But why are you pre-briefing a lower tier analyst, whose clients are most likely your competitors, on something sensitive anyway?


So where exactly is that middle ground? We asked a couple of investor relations experts here at Hill & Knowlton, for the IR perspective, talked to a couple of analysts and we came up with some general rules of thumb around pre-briefings.


  • Ascertain how the news relates to that second maxim – will it materially hurt your business if it becomes public knowledge prior to the embargo date? Is your CEO quitting? Are you being acquired by a competitor? If so, then keep it to yourself – though it won’t hurt to give your best friends in the analyst community a heads up to keep their eyes open for the announcement.
  • Pick the analysts you want to pre-brief carefully…restrict to selected Tier One influencers… people who will both act as a source of credible third-party comment to the press and people you want to get closer to because having a more intimate relationship will meet top-line AR goals of driving sales and revenue.
  • Limit the number of analysts you do pre-brief. In most cases, there’s no need to go beyond two or three of your closest friends.
  • If you are talking about a new product briefing, then you should engage the analysts early, at least three to four months before the announcement date. This will provide them with the opportunity to give feedback while you can still actually gain some benefit from it. Then come back to them again for a sanity check a couple of weeks before the announcement. For announcements that are more material, brief within 48 hours of the announcement… and preferably within 24.
  • Diplomatically establish the ground rules with the analyst when asking them if they are interested in the pre-briefing and setting up the call.
    • Remind them that the conversation will be under NDA. Are they interested in such a call?
    • Point out that the conversation makes them an “insider” and they can’t trade the stock until the announcement is made public.
    • If they agree to these terms – and the overwhelming majority will – then go ahead and book the call, but don’t be surprised if some decline. Some analysts prefer not to operate under non disclosure.
  • Presentation best practices
    • Insert an NDA slide at the beginning of your presentation. You always, always need to remind analysts that the presentation is confidential and this is a ‘gentle’ way of making sure it doesn’t get forgotten.
    • Be clear about exactly what is and isn’t under NDA. Not everything will be. One suggestion is to use different background colours on slides that are under NDA to slides that aren’t. This creates an easy, visual reference for analysts.
  • Follow-up in writing to let analysts know when the material you pre-briefed them on becomes public. Specify in the email which material you are talking about – especially if you are doing multiple rounds of pre-briefings on different announcements. Pasting the announcement in the email is a good way to do this. 


4 Responses to “Pre-briefing rules of thumb for public companies”

  1. Barbara French

    Alex, Great post on a complex topic. I’d add one more consideration:  pre-briefings that require an NDA may also require adherence to specific corporate compliance policies.

    Make sure that your AR team has a simple guideline for knowing whether to participate or bypass company compliance procedures.  Likewise, a few simple steps to follow when compliance policies do apply.

    Often, compliance will entail little more than adding a few specific storage (archiving) steps to the usual AR documentation workflow.

  2. Alex

    Good point Barbara, and thanks for the kind words.

  3. Nancy Shapira-Aronovic

    Very pertinent blog–most of my clients are very nervous about briefing anyone before the distribution of an important press release.  What I usually aim for is to let the specified analyst know a week or so in advance that we will be publishing a PR on a significant event and that we will advise them immediately after publication.  We let them know that they are the first analyst we are discussing this with give them precendence over interviews with journalists.

  4. NDAs mislead, slow, weaken and pressure analyst relationships : Analyst Equity - Lighthouse’s action research blog

    [...] NDAs place stress on the relationship In the opinion of Alex Anderson: “Most top tier analysts will flat out refuse to sign a special NDA and by asking you risk [...]

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