Analysis of the Financial Communication of Renault (2007)
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Financial communication means the dissemination of financial information to shareholders, investors, financial analysts, journalists and specialized environmental officers who may be interested in the organization. Financial communication is addressed today to a new audience, a wider audience which includes individual investors. It is no longer centred on accounts, but takes the form of general economic information. The communication is adapted to cater to each type of investor. This legal obligation unveils the economic and strategic picture of a company to its audience; it must be neat, relevant, transparent, clear and concise.
Today, this type of communication has become an ongoing concern of leaders as it impacts investors' decisions regarding the share prices of major groups, in other words, on the reputation and image of an entire company .The Renault group, according to La Tribune (from 11/06/2004), excels in financial communication; the group was awarded the annual Grand Prize in 2005 for having "an open communication which gave continuous information to shareholders, both individual and institutional." Moreover, in France, Renault benefits from its positive and reassuring image as a powerful company which remains close to its customers. This can be explained through various factors.
This is due especially to its strategy of buying stakes in companies such as Dacia, Nissan, Volvo, and its expansion plans in countries considered risky, a strategy deemed daring by many but which ultimately paid off. It seems clear that Renault attaches great importance to its financial reporting and to maintaining its current image. However, is this picture measured at fair value? It demands the question of whether Renault is truly honest with its shareholders regarding the information it provides. Is the information disseminated by the company indicative of the real situation? Does it reflect the real performance of the group? Does Renault seek to hide its hitches in performance or does it portray its failures clearly? Also, what is the degree of the transparency of the information disseminated? To answer these questions, the following study is based on documents and other items bearing the financial communications of Renault in 2007.
The group is "on line" in a variety of media to disclose financial information from media-paper with the annual report on online video-conferences, speeches and interviews of leaders of the different actors of the company. The public also has access to many dynamic graphics in the particular market situation of the group. This paper highlights the efforts of the group in terms of financial marketing. The group is trying, through these media, to equate the investor and the shareholder to a customer, the company with a product and create an attraction to the strategy of the company.
To determine the relevance of its reports, it is necessary to evaluate the information disclosed through the media. Renault has posted a lot of information very promptly. Its website is very clear and easy to use. The information is rich and diverse, it is appropriate to the media used and the intended target. It may lack direct access to international data.