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1. The Opening Bell - Disclosure Dilemma II
January 18, 2013
Welcome to our second submission of The Opening Bell column. First, let me
express my appreciation for the thoughtful responses to our initial column.
Clearly, the issue of corporate disclosure through social media is an intriguing
and trending topic that requires an immediate and ongoing review by the SEC.
We’ll continue to provide you with updates and news as they come in. As a
follow-up, here are several postings we recently found that address the issue
further.
The first is by Holly Gregory, a partner in the Corporate Governance practice at
Weil Gotshal & Manges, to the Harvard Law School Forum on Corporate
Governance and Financial Regulation. Her position concludes with an interesting
take on how this issue might impact insider trading defendant strategies going
forward.
The next is an article by the New York Times Deal Professor describing another
high profile CEO who recently Tweeted on circumstances involving his company.
In this case, the CEO was Scott Griffith, the chairman and CEO of Zipcar.
Several days after Avis Budget Group, Inc. announced that it was acquiring
Zipcar, Mr. Griffith posted a Tweet referring to an article in the Boston Globe
on the transaction. Despite appearing to be a rather benign post, Zipcar’s legal
team shifted into hyper drive and filed an 8-K with the SEC disclosing the
Tweet, in addition to attaching a transcript of a subsequent appearance made
by Mr. Griffith on CNBC. Given the potential legal issues surrounding Netflix, as
we discussed last week, we believe Zipcar’s prompt response was appropriate
and reasonable.
Equity Research Prologue:
Finally, as we mentioned last week, this column will also spend some time
sharing our opinions and providing updates on the state of investment banking
equity research. Over the last decade, there has been a reduction in investment
banks’ commitment to the research function. We provide you with a few data
points to consider below.

2.  According to NASDAQ OMX, total shares traded in 2012 fell by 18.5%
from the previous year to 1.6 trillion shares. It represented the lowest
level since 2007 when 1.5 trillion shares were exchanged.
 Average daily volume fell to 4.6 billion in 2012 representing a
decrease of 18.6%, and representing the lowest level since 2007 when
4.8 billion shares traded on a typical day.
 According to Bloomberg data, forty investment banks announced more
than 68,000 job cuts in 2012 with the bulk of those cuts in equities.
 Integrity Research recently reprinted data from Frost Consulting
projecting that global investment bank spending on research will have
declined from $8.2 billion in 2008 to $4.8 billion in 2013.
 ETFs received $191 billion in new assets in 2012 while U.S. stock
funds saw withdrawals of $82 billion through September of 2012.
Clearly, not the most optimistic data to end our discussion with but important,
nonetheless, in order to frame the issues driving investment banking research.
About the Opening Bell
Gus Okwu manages the International Financial Communications/IR group at
Allison+Partners. Prior to joining the firm, he spent more than 20 years working
on Wall Street as a senior equity analyst at Wachovia Securities covering
telecoms and as a senior debt analyst at Fitch Ratings, covering U.S. and Latin
American media and telecoms companies, and as a banker. The Opening Bell’s
team of experts have accumulated decades of experience in investor relations,
financial communications, public relations, equity research, proxy work and
journalism.
This column is meant to provide Allison+Partners’ clients and interested parties
with a better sense of the issues driving the capital markets and in particular,
areas covering research, trading, financial communications and investor
relations. Through our weekly submissions, we hope to provide you with a
better sense of how to navigate through issues covering corporate and financial
disclosure, valuations and corporate governance – some areas to be
emphasized more than others. We aim on presenting ourselves as an

3. independent source of news, analysis and commentary and appreciate any
opportunity to learn from others with deeper experience or insights on issues
raised. Consequently, we encourage feedback with respect to the content
submitted. If you would like to contact The Opening Bell with suggestions,
comments or corrections, please email us at gus@allisonpr.com.