On Sept. 25, 2006, Jonathan Schwartz, the CEO of Sun, wrote to the U.S. Securities and Exchange Commission. Schwartz wants to be able to use the Internet — including his official blog, hosted on Sun’s servers — to disseminate company news, including financial data and product releases. Currently, publicly traded corporations must use traditional methods like press releases and audio conference calls to disclose financial data.
Schwartz argues that public disclosure of information on Sun’s Web site meets the spirit of the SEC’s “Regulation Fair Disclosure,” which mandates that information that might affect a company’s stock price be made available to everyone at the same time. In the past, of course, preferred analysts might get early warning; Reg FD seeks to stop that, and place all investors on equal footing.
On Nov. 3, Christopher Cox, chairman of the SEC, replied — in the form of a comment on Schwartz’ blog. I’m delighted that we have a government official that “gets it,” and that Schwartz’s proposal is being taken seriously.