A:

Earnings conference calls are periodic teleconference events held by publicly traded companies. These conference calls are held so that the company can discuss the financial results of the period (quarterly, annually, etc). Before 2000, these earnings calls were generally closed to the public (individual investors) and only open to large institutional investors and analysts. During the 1990s, when internet usage became widespread and individual investors gained access to stock trading functions through the web, there became an increasing awareness of the importance of information.

A lot of companies started offering webcasting services in order to encourage companies to include individual investors in the conference calls. In December 1999, faced with increasing complaints from individual investors, the SEC proposed Regulation FD. In August 2000, after vigorous debate, the SEC passed Regulation FD. To promote full public disclosure, Regulation FD stipulates that companies must make public any nonpublic information that is disclosed to certain individuals or entities like securities market professionals, analysts or company investors.

For more on conference calls, read Conference Call Basics and Conference Calls: Press 1 For Investment Insight.

This question was answered by Chizoba Morah.

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