Reg FD, adopted by the SEC in 2000, is designed to ensure that all investors have equal access to material information about a public company. The rule applies when information is both material and nonpublic, and it restricts sharing that information with analysts, large shareholders, or other outsiders without making a public disclosure.
A company must publicly disseminate material information that is disclosed to any outside party in a manner that provides broad, nonexclusionary access to the investing public. Typical public channels include press releases, SEC filings (such as Form 8-K), company websites, and widely accessible conferences or webcasts. The disclosure should convey the same information that was provided to the outside party. In cases of inadvertent disclosures, the company is expected to promptly provide a public disclosure to restore equal access.
Reg FD applies to officers, directors, and other insiders who communicate with external parties about material information. The rule does not prohibit private conversations, but it does require that any material information shared in those forums be promptly and publicly disclosed if it is not already public. The goal is to reduce information asymmetry and promote fairness in the market.
If a company's chief financial officer shares income guidance with a group of analysts, Reg FD requires the company to issue a public disclosure of the same information to ensure broad access for all investors.
Material nonpublic information · Public disclosure · Selective disclosure · Earnings call · Investor relations · Disclosure controls and procedures