The regulatory framework
UK listed companies operate within a framework designed to ensure fair, timely, and accurate disclosure. The key principle: all investors should have access to the same material information at the same time.
Key regulations
- Market Abuse Regulation (UK MAR) — prohibits insider dealing and requires prompt disclosure of inside information
- FCA Listing Rules — requirements for companies on the Main Market, including continuing obligations
- Disclosure Guidance and Transparency Rules (DTR) — rules on periodic financial reporting and major shareholding notifications
- AIM Rules — separate rulebook for AIM companies, enforced through Nominated Advisers
The consequence of non-compliance ranges from public censure to fines, suspension, and ultimately delisting. Directors can face personal liability for failures in disclosure.
The RNS system
The Regulatory News Service (RNS), operated by the London Stock Exchange, is the primary channel for regulatory announcements. When a company has material information to disclose, it submits an announcement to RNS for immediate distribution.
What gets announced
- Results — annual, interim, and trading updates
- Director dealings — share purchases and sales by insiders
- Major shareholdings — when significant holders cross thresholds
- Corporate actions — dividends, share issues, M&A activity
- Material contracts — significant commercial developments
The process
Announcements are typically drafted in Microsoft Word, formatted according to RNS templates, and submitted through the RNS portal. Once approved, they're distributed simultaneously to all connected terminals and data vendors.
This process is effective for compliance but creates challenges: announcements are essentially PDF documents masquerading as data. Key figures are buried in prose. Structured, machine-readable information is the exception, not the rule.
Primary Information Providers
While RNS is the dominant channel, companies can also use other approved Primary Information Providers (PIPs). These include:
- Business Wire
- PR Newswire
- GlobeNewswire
- Notified (EQS)
All PIPs must meet FCA requirements for immediate distribution, but the practical reality is that RNS handles the vast majority of UK regulatory announcements.
Beyond compliance: investor relations
Regulatory disclosure is the baseline — necessary but not sufficient. Companies also engage in voluntary communication to build understanding, trust, and ultimately a fair valuation.
Compliance layer
Mandatory disclosures through RNS. Non-negotiable, time-sensitive, legally required.
Results, director dealings, major shareholdings, material events.
Engagement layer
Voluntary communication to build relationships. Strategic, ongoing, discretionary.
Presentations, roadshows, investor days, media engagement.
The global average investor relations budget is around $371,000 per year[4] — covering staff, advisers, events, and tools. For FTSE 100 companies, the figure is considerably higher. For small caps on AIM, it may be a fraction of that, often handled by management directly.
This creates a two-tier system: large companies can engage deeply with analysts and investors, while smaller companies struggle to be heard at all.
The information gap
A well-resourced investor relations function can make a material difference to valuation. Research shows that companies with better disclosure trade at premium multiples, have lower cost of capital, and attract more stable shareholder bases.
But for smaller companies, the economics don't work. They can't afford dedicated IR teams, commissioned research, or expensive roadshows. The result is an information vacuum that technology is only beginning to address.
MiFID II exacerbated this problem by unbundling research payments, leading brokers to cut coverage of smaller companies. Many AIM stocks now have zero analyst coverage — making it harder for investors to find and evaluate them.