The debate between BT and its owners has spilled into the public domain and must have damaged the company in its attempts to sell businesses and to raise new funds. The trend in the regulatory regime in Britain and US financial markets is towards greater transparency. Price sensitive information is to be disseminated to all shareholders simultaneously. Selective briefings of analysts and fund managers should become increasingly anodyne. It will be interesting to see where this leaves debate between management and fund managers about strategic alternatives and possible deals.
Companies are typically paranoid about developments being taken amiss by the markets.
Although they pay their advisers substantial sums to second-guess fund managers, there is no substitute for certainty. For all their mutual interdependence, there are perennial complaints from company executives about the collective of fund managers and vice versa. It is as if the two breeds find it impossible to imagine confronting each other's day to day challenges. Greater enforced formality in the interface between the two will probably place increased strain on their relationship. One solution might be more frequent announcements of results and strategic thoughts by all companies.