DLA Piper's "Annual shareholder letter considerations and guidance" benchmarks COVID-19 disclosures in annual shareholder letters based on the firm's analysis of 112 recent Fortune 500 company letters.
Among the key takeaways:
- 52% of letters were silent about COVID-19 and its potential impact on the company, and an additional 28% mentioned COVID-19 only in the context of conducting or potentially conducting a virtual meeting.
- 19% of letters included statements regarding COVID-19-related risks even though the impacts on the company may be uncertain. Of these, COVID-19 was a dominant theme in four letters and one included a separate CEO letter specifically addressing COVID-19.
The memo - which also includes relevant excerpts from 10 recent letters - suggests companies that choose to include a shareholder letter with their annual report or proxy take a more balanced, MD&A-type communications approach in lieu of avoiding a discussion of current challenges associated with COVID-19. This post first appeared in the weekly Society Alert!