Webranking 2004-Italy Top80:

Monday, October 25, 2004

One year after Parmalat, Italian online financial transparency still needs to be improved.

Ras, Eni and Merloni have the best Corporate Websites in the survey. More than half of the companies do not disclose adequate information in English.

Milan, 25 October 2004 - As revealed by Webranking 2004 Italy TOP80, Ras, Eni and Merloni have the Italian websites that best meet the information requirements of the international financial markets. Alleanza Assicurazioni's Website has improved the most in this year's Italian survey, which included 80 of the country's largest companies, the biggest scope ever. The survey is the eighth consecutive edition of the Webranking Survey conducted by the Swedish IR Advisor Hallvarsson&Halvarsson in cooperation with Corriere della Sera and the Financial Times.

Among the 50 Italian websites reviewed both in 2003 and 2004 the results are encouraging. The average score is up from 37 points out of a maximum of 100 in 2003 to 42.6 in 2004. Five companies score more than 60 points. Eighteen companies score more than 50 points, compared to only eight companies last year. The ten companies that have improved their online transparency the most are in order: Alleanza Assicurazioni, Ras, E.Biscom, Mediolanum, Tiscali, Snam Rete Gas, TIM, Eni, Unicredit, and Mondadori.

Adding the 30 new entries in this year's audit the total average decreases slightly compared with last year, going from 37 points to 36.7 this year. The average score of the Websites of the 30 new companies is 27.5.

Eleven Italian companies are present in the pan European Webranking Survey of the 150 largest blue-chips (FT 150) which will be published in the Financial Times and Corriere della Sera on 3 November 2004. The average score amongst these eleven Italian companies is 57.3 points, almost reaching the average score of the UK websites of 57.7.

The Webranking Survey

The Corporate Websites of the companies in the survey have been audited using a review protocol of 111 criteria that sum up to 100 points and are divided into two categories: Content and Technology. The criteria have been created by incorporating the answers from a questionnaire on how 147 European financial analysts and business journalists use Corporate Websites and what information they require. In essence, the audit covers the Websites' corporate information, investor relations, press office and career sections. The focus remains however on financial information, with approximately 40 percent of the criteria and points.

- The evaluation this year has been stricter and we have introduced 13 new criteria and modified another 33 in order to reflect current trends and developments. For example, in addition to listing the names of the members of the board and the top management, to score full points in that section, there must be CVs and photos in high resolution, explains Joakim Lundquist, head of the Italian survey. New criteria this year include: IR policy, general archive, investments and divestments and share price history in excel.

Areas that have improved

Among the 50 companies studied both this year and in 2003, essentially three areas have improved significantly:

1. Interactivity: Overall, the Italian companies have doubled the score in this area reaching 32 percent of the maximum score. The most interesting aspect is two practical tests that were carried out. Twenty-eight percent of the companies replied to an email with a simple question within two hours compared to 16 percent last year. Fifty percent of the companies did not reply at all compared with 75 percent in 2003. Last year only 12 companies sent their annual report after an e-mail request whereas in 2004 the number of companies rose to 26. Furthermore, in 2004, 25 percent of the companies offer online forms to order printed material such as reports and presentations compared with only 5 percent in 2003.
2. Links, updates and language: The overall average is up from 27 percent in 2003 to 49 percent in 2004. The most significant improvement is the fact that 40 percent of all the Websites now clearly state on each page the latest update (14 percent last year).
3. Corporate information: The increase of the average score from 29 percent to 43 percent is mainly due to better information regarding CSR, as for example stating ethics policy and ethical ranking, and environmental information. The latter of which is present on 31 percent of the Websites.

In the section that covers financial information the results have not changed considerably. Italian companies remain rather good at presenting archived annual and interim reports, presentations and press releases. It is however interesting to note that the bulk of the companies now provide a financial calendar with upcoming events and that information about the annual general meeting is more common. This year three out of four companies present their share price on the Website and comparative financial figures, key ratios, share holders information and analysts coverage is becoming praxis in Italy.

Areas still to be improved

In the aftermath of the Parmalat and other recent financial scandals in Italy, the importance of providing corporate and financial information in English in a thorough and transparent manner is an imperative step in order to recover trust and credibility among the international investment community. It is also a vital issue in order to facilitate international investments as well as managing the communication with a company's international stakeholders. In this context it's rather worrying that one of the constant elements in the Italian Webranking survey in the past three years is that many companies still communicate poorly in English. In our view, a minimum score of 50 points should be seen as acceptable in this context. This year 27 companies do not reach the level of 30 points. Moreover, it's also a necessity for many companies to improve the quality of the English used on the websites and to address terminology which is not clear or badly translated.

There are three other areas that also need to be addressed:

1. Corporate information needs to be improved further, in particular environmental information, speeches by the top management and the career sections.
2. Corporate Websites need to become more accessible for disabled and old people. This is also an area of international attention driven by the WAI standards. In Italy the website that scored highest on Accessibility was Hera.
3. Financial information, such as risk management, financial outlooks, sensitivity factors, and dividend policies, needs to be further improved.

Observations and conclusions

During the last few years we have observed a strong trend towards a harmonization of the structure and content of Corporate Websites in Europe. This development has been a natural evolvement driven by best practice examples as well as the need to develop ways of communicating with an international audience in a clear, comprehensible and linear manner, for example by using standard terminology and navigation. An example is the increasing usage of standardised modules such as calendars and share price graphs. This whole process in now being reinforced by the emergence of both national and international standards initiated by the EU, local stock exchanges and other authorities.

- The results of this year's edition of the Italian Webranking study are very promising. We have observed a fast growing culture and commitment to transparency among the companies. This year's success stories of several Italian companies will hopefully be a source of inspiration for the companies that still need to improve the quality of their Websites. Unfortunately, the Italian study clearly shows that a very large part of the Italian companies still do not provide enough English information on the websites, said Joakim Lundquist.

An interesting finding is that even several relatively small companies in the survey have first-rate Websites. Companies like Merloni, Benetton, Erg, and Tiscali are all four positioned among the top seven companies. The mid cap Campari appears already on the 12th place. This illustrates that developing a best practise Website is not only an issue of the dimension of the company and its financial resources, rather an expression of a strong commitment of the company, creating a culture of communication, and an internal organisation apt for handling it. From a content perspective a company can reach a good level of transparency on the web by using more of its official documentations such as annual reports, presentations and press kits, and by presenting them in a more extensive and user-friendly manner.

A good corporate Website however, is not only about transparency. Creating an accessible Website for a bank could mean new business and a well developed CSR section has the potential to attract new investments. It certainly enhances the efficiency of the communications process freeing valuable IR and press office resources for more value added activities.

Webranking 2004 Italy Top80:
Review results of the 80 largest listed Italian Companies (Excel)
How Webranking 2004 works (Excel)

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Further information, please contact H&H directly or visit our websites.

Contact:

Hallvarsson & Halvarsson Milan:
Joakim Lundquist
T: +39-02-8969 1118, Mobile: +39-339-5013612
E-mail:
www.halvarsson.se, www.webranking.eu

The accessibility test has been conducted by FunkaNu (www.funkanu.se - ) whereas the test on search engines and visibility has been done by Sitelynx (www.sitelynx.com - )
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