 |  Periodic editorials concerning everything from the very worst industry—from an annual report standpoint, that is—to what's wrong with the Fourth Estate. Reporters who can't hit an accuracy with a cannon. |
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| Periodic editorials concerning everything from the very worst industry—from an annual report standpoint, that is—to what's wrong with the Fourth Estate. Reporters who can't hit an accuracy with a cannon. |
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Where are they now?
Twenty-two of the year-ago (for 2002) annual reports to shareholders achieved what I refer to as "world-class" status. That is, scored at least 100 of a potential 135 points in our copyrighted (since 1984; used a year earlier) criteria on what makes a good report. Strictly by coincidence, I happened upon the 1999 listing of world-class reports—44 names. That started me to thinking: What happened to the half nowhere to be found? Did they actually submit their 2002 report, and it was overlooked? Or has the company simply disappeared—been gobbled up by the acquisitive, for instance? One would assume that, having been recognized for its excellence, a company would be sure to submit its next report. Keep in mind that some no doubt no longer exist as a publicly held corporation—American Water Works, for example, which was merged into a foreign firm. Understandably, in some instances the report's producers took umbrage at something-or-other—that we did, or said. Case in point: Peoria, Illinois-based RLI Corp., whose dearth of minority directors (only white-faced men), and our criticism thereof, no doubt angered and/or embarrassed the insurance company no end. It's not all that surprising that it opted not to submit its report for our free evaluation. Clearly, several 1999 top-tier finishers simply failed to send in their reports. Among them: American General, Mexico's Grupo Vitro, Otter Tail Power, Standard Register, Summit Bancorp, Compaq (now part of Hewlett-Packard, of course), Quaker Oats (acquired by PepsiCo), TDK, National Service Industries, Lucent Technologies, A.C. Nielsen, Merck, Colgate-Palmolive, Bindley Western Industries and UtiliCorp United, whose executive-level communicator retired. Oh, yes—and Phillips Petroleum, now merged into ConocoPhillips. R.R. Donnelley & Sons Co., with 114 points, was among the 1999 world's best; its 2002 score: a measly 82 points. Harleysville's score declined from 102 to 87 points, Canada's Cameco, off from 101 points to 63, Pepsi Bottling from 101 to 79, IBM to a close-but-no-cigar 97—from a qualifying 100 points. Canada's Aliant, though, hung on, its 2002 score 102 points; AFLAC duplicated its 133-point showing three years earlier; NW Natural's score of 110 was three better than in 1999; Mexico's CEMEX, which retained us to analyze its report in depth, was rewarded with a score 50 points fewer than with its '99 book: 56 points, off from 106. Badger Meter had 103 points three years ago, off to 71. Wells Fargo's 91 points currently contrasted with 103 previously. Among 1999's crop, Devon Energy had 119 points. In checking our records, we learned Devon's document wasn't submitted. A copy was rushed us belatedly as this was being penned. Its score, on initial evaluation: an admirable 111 points. Bottom line: As we wrote at the outset, only half so many annual reports currently made our list of world-class reports—those scoring at least 100 of a potential 135 points. God love the nucleus—those who hang in there, through good years and bad. Other side of the coin: Roughly half so many admirable reports exist today as three years earlier. Sad. |
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