The disclosure obligations of listed companies

Listed companies must disclose various information so that their shareholders know how the company is doing. These obligations are referred to as disclosure duties.

When a company is listed on a stock exchange, its shareholders want to know what is happening with this enterprise. Any change in business operations can affect the stock price. Therefore, listed companies are subject to various disclosure duties. This means that companies whose shares are traded on the Swiss stock exchange must provide certain information to their shareholders. There is a distinction between recurring obligations and event-based obligations. While recurring duties occur regularly, event-based duties are triggered by a specific business event.

Recurring obligations

The recurring disclosure obligations include what are known as regular reporting duties. These encompass all technical and administrative information relevant to shareholders. For example, a company must indicate if it changes important links on its website. Also part of the recurring disclosure duties is the obligation to provide financial reporting. Listed companies must publish an annual report and a semi-annual report so that their shareholders are aware of the business figures. Included in these reports are a balance sheet, an income statement, a cash flow statement, and an appendix. Moreover, there is a duty to disclose information about Corporate Governance in the company. This means the company must provide information on how much compensation the executive and supervisory board members receive and the components of this compensation. In a Corporate Governance report, for instance, it might state: "The executive board members receive a CHF 100,000 fixed salary plus 2% of the annual profit".

Event-related obligations

The most important event-related disclosure duty is Ad-Hoc disclosure. Ad-Hoc means something like "now" or "immediately". Companies must publish under Ad-Hoc disclosure any information that can affect the stock price. Frequently, companies make an Ad-Hoc announcement when there is a purchase offer for the company. Management transactions also need to be disclosed. This means that if members of the supervisory board or the executive board buy or sell shares, the company must announce it. Such transactions can be an indication of how well the company is doing. Additionally, shareholders must announce if they acquire a certain percentage of a company's shares. If a purchaser owns 3%, 5%, 10%, etc., of the shares, they must report this to the exchange. If the purchaser does not do this, the company is obligated to make the notification in its place. This is to prevent an investor from secretly gaining control over a company.

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