Our friend, who has been fighting for the clarification and transparency of companies to the individual investor, the printed annual report, is slowly fading away. Once known as a crime-fighter (or vigilante, if you wish) in the eyes of both the shareholder and the corporation, the report once presented the corporate profile, business practices, company strategy and a snapshot of the financial performance of a company for one year. Over the years, a shareholder could study a few consecutive year reports and make a judgement about where their investment value was most effective. Speaking to the shareholder, the annual report was a form that although sometimes made mistakes, still had intentions to communicate to the everyday laymen what was good about the company. The presence of the report was also a reflection on how healthy the economy is. That was the power of the traditional printed annual report.

There are still a few traditional annual reports out there still fighting for shareholder's rights. The trend five years ago has been for U.S. companies to transform the communications tool into a summary annual report, the smaller version. Sid Cato, long-time critic of annual reports says summary annual reports are" a good idea only if you're into shortchanging the stockholder, ripping off the reader. This Pee-wee Herman of annual report presents the potential for massive manipulation of the facts: Companies get to pick and choose what to include, what to leave out."

Even more popular and worse, the 10-K wrap, leaves only four to twelve pages of miniscule real estate for a company to communicate pertinent information, and lets corporations leave out a lot more. Such evil has taken over investor relations departments and IROs have succumbed to the wrath of the wrap, or even more prevalent–the 10-K by itself, without the wrap. Is distributing investor communications like this still providing the same amount of information to the shareholder? James Pethokoukis, in his article in The American says" the wrap is nothing more than an SEC report stuck between a couple of pages of explanatory material and probably a terse, no-nonsense letter to shareholders. Sure, the 10-K supplies plenty of numbers. but numbers without analysis or context may be little help to investors."

The printed annual report, which was once soley a financial document was transformed into a corporate communications tool in the 1960's. Since then, the report has been keeping peace and justice in the realms of the investor community, corporate communications and employee morale. The powers of the annual report have been diminishing in recent years. But is it dying?

Companies are producing more and more Corporate Social Responsibility (CSR) reports. These reports are targeted in their messaging, specifically towards company efforts in environmental, sustainable, and citizenship activities. This trend is slowly becoming popular with the forerunners being the larger U.S. corporations such as Starbucks, Motorola and Campbell's. Worldwide, approximately 3,000 are being produced, so the numbers are still small. And although a company's good practices are being highlighted in CSR reports, potential investors are still missing out on the whole company story with the depleting annual reports.

Companies who in the past had been producing full annual reports are shrinking their formats to either summary reports or 10-K wraps. Many companies who have healthy marketing budgets now don't produce one at all (putting all their resources into the marketing budget), and only distribute a 10-K. Companies are losing out, not only in the chance to communicate the investment value to their shareholders, but also in the opportunity in servicing their audience and providing valuable informational tools to allow the public to make informed investment decisions. Confused and fearful shareholders usually pull out their investment and put it towards something they understand. If companies continue to weaken their annual report, they should be prepared to do the crime-fighing on their own.