Mobile TV studio plan to counter ‘cash for access’

Institutional Data (IDL), a new venture from Ian Fallmann, former managing director for Bloomberg Asia-Pacific, is set to roll out a fleet of ‘remotely controlled compact broadcast studios’ aimed at offering access to the C-suite without the scandal.

The practice of spending investors’ money to pay for access to corporate executives has come under increasing scrutiny in recent months, with the UK’s Financial Services Authority reportedly preparing a crackdown on so-called cash for access. This comes after an investigation by the Financial Times, which found that some groups were ‘paying brokers up to $20,000 to meet the chief executives of their corporate clients, with the CEOs often unaware their time was being sold.’

Now IDL is aiming to move the C-suite away from such practices without compromising access by allowing ‘executives to communicate frequently, efficiently and inexpensively with their shareholders and prospective shareholders around the world,’ according to a statement.

‘One of my key functions at Bloomberg was to devise new ways to capture data for consumption by the institutional buy side,’ explains Fallmann in the press release. ‘Verbal updates, such as AGMs, investor/analyst briefings and roadshows, were always difficult to capture because of the perceived importance of non-verbal communication, but now technology has moved on. We can make the CEO happy by delivering a broadcast-quality program to hundreds, even thousands, of investors, and help them to meet their fiduciary obligations by engaging in eye-to-eye interaction for Q&A.’

IDL’s business model will rely on asset managers paying a subscription fee for a real-time data feed ‘in the same way as they are accustomed to pay for most other classes of financial data’, while the service will be free for issuers. According to the statement, ‘cost savings are expected to be substantial compared with the current business practice’.

‘This platform is as effective as a personal meeting for communicating everything an issuer might wish (and is legally allowed) to say,’ adds Fallmann. ‘We believe it will prove to be a popular solution with risk/compliance officers and regulators. Airlines and hotels, and any CEO who sees roadshows to London, Paris and New York as shopping trips, will be less pleased. Shareholders will ‒ of course ‒ benefit.’