Full disclosure (there isn’t any)
Today Sir Martin Sorrell’s S4 Capital raised its revenue forecasts for the third time this year.
Last week S4 bought LA-based agency Cashmere, its 25th deal of note since the firm was founded in May 2018.
Both events were applauded in the press, fair enough.
Sir Martin is plainly a brilliant businessman. If you doubt that, just ask him, he’ll tell you.
Since S4 Capital has gone from zero to a market value of £4.5bn in no time at all perhaps he has every right to be, erm, confident.
What is notable is how little he tells us how he got there, how those 25 deals are funded.
A top piece in the FT the other day noted, in relation to Sorrell, that “good storytellers know to leave an element of mystery”, while asking why it can be good for shareholders to know so little about the company, even including how much of it they own.
The point here isn’t Sorrell or his already rich investors. It will work out for them, or if it doesn’t, so what.
And the most material details will probably be in his annual report, if we still care by then.
The point is the wider trend in companies large and small declining to tell us very basic pieces of information when they do a deal/join the stock market.
Stuff as simple as: who owns this thing? Or: how do you get to that £3 billion market value? Show us the maths, otherwise it just looks like you made it up.
From the conversations I’ve had, the PR industry is mostly with me on this one.
“I know,” said one slightly exasperated flak last week. “I’ve told them (the client) that they need to be more open, or it will bite them later. They won’t listen.”
At some point hacks needs to start saying: if you don’t tell us, we simply won’t do the story.
For the moment, we are so glad for signs of good news post the worst of Covid, we are letting companies get away with fairly lax disclosure standards.
