Web designers are some
of the most sought-after professionals in the global job market. However, in
recent years, these professionals have not been able to capture the market for publicly-traded
companies. As a result, many web design professionals are losing business because
they cannot match the requirements of publicly-traded company websites.
It is not because these
professionals lack the skills for developing outstanding websites. Rather, publicly-traded
companies have legal obligations that dictate what kind of design is
acceptable. Even a single mistake in design can land the public company into
complex legal problems. These legal problems may tarnish the reputation of the
company or result in hefty fines.
In this article, we
discuss which requirements are mandatory for a publicly-traded company’s
website and how web designers can overcome this problem.
How Are Publicly-traded Company
Websites Different?
Since the ownership of
a publicly-traded company is dispersed among different members of the public,
these companies have to be extremely transparent. The Securities and Exchange
Commission has enforced laws to eliminate embezzlement and fraud by giving
investors full disclosure.
For this reason, many
public companies maintain a separate department for managing investors, known
as Investor Relations. In fact, Investor
Relations is the reason why all publicly-traded websites are so difficult to
design.
Let us take a look at the
mandatory requirements for all publicly-traded websites:
1)
SEC Filings
and Financial Disclosures
A publicly-traded
company has to post updates regarding the following documents on its website:
SEC Filings
According to the Sarbanes-Oxley Act of 2002, once a publicly-traded company files forms 3,
4, and 5 with the SEC, it must also post these filings on its IR website by the
end of each business day.
Some web designers link
the website to the SEC’s website to simplify the updating process. However, doing
so is not an SEC acceptable display method. Since these filings must remain
posted for at least one year, the designer has to develop an archive of
previous filings and maintain all that information.
Non-GAAP Financials
The regulation from
the SEC dictates a company should make its non-GAAP financial measures consistent with Generally
Accepted Accounting Principles (GAAP) measures. Moreover, they have to include
that information in press releases, audio recordings, and SEC files posted on the
IR website. This disclosure must also explain why non-GAAP information can be
useful to investors.
2)
Corporate Governance
Besides financial disclosure
and filings, the Sarbanes-Oxley Act enforces public companies make corporate
governance to be accessible on their websites. Therefore, web designers need to
develop a well-defined sub-section for corporate governance. This section
should include the following information:
Board of Directors
This section should
list all independent and dependent board of directors. It may include group
photos of all board of directors along with short biographies of each director.
The Board of Directors
section is an integral component of a publicly traded company’s website, as it
personalizes the story of the company and adds credibility to its brand.
Governance Library / Committee
charters
This section enlists
the company’s Code of Ethics and details about its audit committee.
Furthermore, the section should define the company’s policy for ‘Nominating and
Governance Compensation.’
Committee Membership
This section contains information
on the company’s compensation committee and other charters the company has
adopted.
Whistleblower Policy
A publicly-traded
company is also required to display a transparent whistle-blowing policy in the
corporate governance section.
3)
Proxy Materials
and Cookies
The SEC enforces
public companies to post proxy materials on their websites. This means that the
website should host annual reports, letters to shareholders, and annual
shareholder meeting invitations.
These documents need
to be in a searchable, easily readable, and printable format. So at the very
least, a web designer has to enable the option for PDF files for this section. Since
the SEC regulations want to make these postings anonymous, web designers cannot
use Cookies as well.
How Can Web Designers Overcome This
Problem?
Web designers have to
make sure that a public company’s website complies with the rigid guidelines
issued by the SEC. If it fails to do so, the SEC can penalize the company with
large fines. In 2018 alone, the regulatory authority managed to collect up to $4 billion in fines.
For this reason, B2i
Technologies has developed a comprehensive solution to help web designers
create SEC-compliant IR websites. It allows web designers to leverage Investor Relations
plugins on WordPress and other CMS platforms.
These plugins provide
a reliable and customizable way for publicly traded companies to display their data.
It can update the corporate website with press releases which the company
released to news wire services as well as stock data, charting, and all the SEC filings made
by the company within SOX compliance standards.
Furthermore, it enables web designers to
automate the flow of data and
display real-time data to website visitors. As a result, companies can load
filing information and press releases directly to their websites without any
manual intervention.
Moreover, the plugin
helps companies to distribute new filings to their contacts through email
automation. With the help of B2i’s robust plugins, web designers can now
develop dynamic websites for publicly-traded companies.
B2i TECHNOLOGIES
Seamless Web Integration for
Investor Relations Since 2000