The document summarizes key findings from surveys conducted by the National Investor Relations Institute (NIRI) in 2008, 2010, and 2012 on corporate guidance practices and preferences. The surveys found that a majority of companies provide some form of earnings or financial guidance, though the percentage providing guidance has decreased slightly over time. Reasons for providing guidance included increasing transparency and ensuring reasonable market expectations. Regulatory factors like Regulation Fair Disclosure have increased the complexity around guidance practices. NIRI recommends companies provide a variety of financial and non-financial guidance metrics tailored to their specific circumstances.

1. A NIRI White Paper
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Guidance Practices and Preferences
By Ariel Finno, Director-Research (afinno@niri.org)
Matt Brusch, Vice President-Communications and Practice Information
© 2013 National Investor Relations Institute

2. NIRI White Paper: Guidance Practices and Preferences
Overview
Since the turn of the century the number of legal and compliance complexities
surrounding the issuance of corporate earnings guidance has markedly increased. A
company’s decision on whether or not to issue earnings guidance or forward looking
statements is an individual one, based on a myriad of unique variables.
Before formulating an earnings guidance policy, corporate executives of publically
traded companies need to become familiar with relevant legal and regulatory guidelines
that have been released by the U.S. Securities and Exchange Commission (SEC).
These regulations include (but are not limited to):
 Securities Act of 1933 and Securities Exchange Act of 19341
 Private Securities Litigation Reform Act of 1995 (PSLRA)2
 Regulation Fair Disclosure of 2000 (Reg FD)3
 Sarbanes-Oxley Act of 20024
 Regulation G of 2003 (Reg G)5
 Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-
Frank Act)6
Several sources for earnings guidance information include:
 “Giving Good Guidance: What Every Public Company Should Know” (Latham &
Watkins, Oct.2012 report)7
 “The Guidance Effect: Improving Valuation” (Sharon Merrill Associates, Aug.2012
report)8
 NIRI Standards of Practice, Volume III: Disclosure (National Investor Relations
Institute, April 2012)9
These and other relevant guidelines should be taken into consideration when drafting a
company earnings guidance policy.
1
codified at 15 U.S.C. § 78.
2
Pub. L. 104-67, 109 Stat. 737.
3
Release Nos. 33-7881, 34-43154, IC-24599, File No. S7-31-99.
4
15 U.S.C. 7201.
5
Release No. 33-8176; 34-47226; FR-65; FILE NO. S7-43-02.
6
Pub. L. No. 111-203, 124 Stat. 1376.
7
http://www.niri.org/Other-Content/sampledocs/Latham-Watkins-Giving-Good-Guidance.aspx.
8
http://www.niri.org/Other-Content/sampledocs/Sharon-Merrill-The-Guidance-Effect.aspx.
9
http://www.niri.org/Main-Menu-Category/resource/publications/Standards-of-Practice-for-Investor-
Relations.aspx
© 2013 National Investor Relations Institute

3. NIRI Guidance Research
For investor relations (IR) professionals, providing forward looking guidance, or what
most commonly is referred to as "earnings guidance," is a core concern. The practice
extends far beyond the decision to communicate earnings per share (EPS) expectations
– the degree of nuance in how each organization issues or does not issue guidance is
considerable.
NIRI regularly researches this subject in order to understand all facets of guidance
practice and provide benchmarking data for best practices.
NIRI guidance surveys typically inquire about practices and preferences related to
company guidance policy. The survey instruments are generally divided into one section
on financial guidance (i.e. all quantitative economic measures of a company’s
performance including earnings or EPS, revenue, cash flow, EBITDA, operating income,
gross margin, expenses, CAPEX, tax rate, etc.), and another section on non-financial
guidance (i.e. any information about current broad-market or business conditions that
have the potential to impact company performance and are not typically reflected in a
company’s financial statements). Additionally, the surveys inquire about the frequency
of guidance (i.e. how often guidance is communicated and reiterated or updated) and
the periodicity of guidance (i.e. the timeframe on which the company is providing
forward looking statements, typically in the form of quarterly or annual estimates).
Presented here are key findings from NIRI’s 2008, 2010 and 2012 guidance practices
and preferences research projects.
2008 Key Findings
 64% of NIRI respondents report providing earnings guidance compared to 51%
in 2007 survey results and 66% in 2006.
 70% of NIRI respondents provide broader financial guidance.
 57% of NIRI respondents provide non-financial guidance.
 The primary reason NIRI respondents indicated for providing all types of
guidance is to ensure sell-side consensus and market expectations are
reasonable.
 Among NIRI respondents who do not provide quarterly earnings guidance, nearly
three quarters refrain in order to focus on long term company performance.
© 2013 National Investor Relations Institute

4. In November 2010, NIRI released Public Company Forward-Looking Guidance
Practices in 201010, which announced the results of its corporate member opinion data
on the subject.
2010 Key Findings
 90% of respondent companies provide forward-looking guidance in some form.
 81% provide guidance on at least one financial measure and 48% provide non-
financial guidance.
 All forms of financial guidance are primarily provided as a range.
 Those who do guide most often communicate annual estimates. The most
common frequency for communicating those estimates is on a quarterly basis.
 The most commonly cited reason for providing guidance was to increase
transparency (82%).
 Of the 10% that do not provide guidance, the majority (60%) has never given
guidance.
 Of those that do not guide, management philosophy (68%) is the primary reason.
NIRI again studied this subject in 2012 in order to assess the current state of guidance
practices and preferences, and to review developing trend information. In September
2012, NIRI released Guidance Practices and Preferences-2012 Survey Results11.
2012 Key Findings
 88% of 2012 respondents provide some form of guidance (either financial, non-
financial or both), compared to 90% in 2010.
 76% report providing financial guidance compared to 81% in 2010.
 44% provide non-financial (broad market) guidance in 2012, a decrease from
48% reported in 2010.
 For those who provide financial guidance, the most common time horizon is an
annual estimate (no change from 2010 results). Additionally, the most common
frequency for communicating estimates is quarterly.
10
http://www.niri.org/Main-Menu-Category/resource/publications/Executive-Alert/2010-Executive-Alert-
Archive/Public-Company-Forward-Looking-Guidance-Practices-in-2010-11410.aspx.
11
http://www.niri.org/Main-Menu-Category/resource/publications/niri-Analytics/Guidance-Practices-and-
Preferences-2012-Survey-Report-9512.aspx?Site=niri.
© 2013 National Investor Relations Institute

5. © 2013 National Investor Relations Institute

6. NIRI Policy Statement - Forward-Looking Guidance Practices
NIRI has long advocated for public companies to provide full, fair and consistent
disclosure of financial information to increase transparency, engender informed investor
expectations and, ultimately, reduce volatility and lower the cost of capital. NIRI
encourages companies to define their own unique set of financial and non-financial
metrics. NIRI supports the notion that undue volatility around a short-term focus is
undesirable and that all audiences - investors, financial analysts, the media - should
focus on the long-term value drivers of businesses. The purpose of this policy
statement, adopted by the NIRI Board of Directors in July 2008, is to enunciate this view
and share it with external audiences.
NIRI encourages public companies to provide a variety of information to assist investors
with understanding and interpreting current results and assessing future prospects.
Each public company must carefully consider its internal forecasting abilities, industry
practice, the needs of the financial community and other constituencies in the context of
stock exchange and federal disclosure regulations when establishing guidance
practices as part of an effective disclosure policy. Such forward-looking information
should cover a spectrum of time frames including long, medium and short-term, based
on circumstances applicable to the company and industry. Once a company determines
the breadth of financial and non-financial metrics that best disclose current and future
prospects, NIRI recommends uniform disclosure to a broad spectrum of financial
publics. NIRI does not propose, however, that a prescribed set of financial information
or a particular format is suitable for every public company or every situation.
NIRI recognizes that the decision of public companies to provide or not provide
quarterly earnings per share guidance alone will not reduce the increasingly short-term
focus of the marketplace, which may be as short as intra-day in some cases.
Furthermore, the influence of additional factors such as quarterly reporting
requirements, quarterly compensation targets of many investment managers, publishing
of quarterly earnings estimates by financial analysts and media focus on public
companies “beating” or “missing” these quarterly estimates continue to place undue
emphasis on quarterly results. NIRI supports a focus on long-term business value
drivers by all financial markets participants - public companies, financial analysts,
investors and the media - a focus that will lead to reduced volatility and a lower cost of
capital.
Adopted by the NIRI Board of Directors July, 2008
© 2013 National Investor Relations Institute

7. More Information
For complete survey results, please visit www.niri.org, or contact Ariel Finno, Director of
Research, (703) 562-7678, afinno@niri.org.
About the National Investor Relations Institute
Founded in 1969, the National Investor Relations Institute (NIRI) is the professional
association of corporate officers and investor relations consultants responsible for
communication among corporate management, shareholders, securities analysts and
other financial community constituents. The largest professional investor relations
association in the world, NIRI’s more than 3,300 members representing over 1,600
publicly held companies and $9 trillion in stock market capitalization.
© 2013 National Investor Relations Institute