US: Halliburton Cordially Invites You to Come Stand in the Hall

It's not every day that you get invited to a meeting you're not allowed to attend. Halliburton called earlier this week to ask if I was coming to the company's annual meeting today at the Four Seasons. 

There was one catch: The company wasn't allowing outsiders in the meeting. That included the press.

Chief Executive Dave Lesar might be available for questions afterward, but there would be no formal news conference. Why, I asked the Halliburton spokeswoman, would I want to come if I couldn't attend? Well, she said, I could at least get into the hotel, and that would give me a chance to talk to Lesar. But there would be no firsthand reporting on the meeting.

Now, it is a shareholder meeting, and I am not a shareholder. Technically, the company has every right to keep me out. As a practical matter, though, the move is a step backward.

Halliburton showed great promise last year by opening its meeting to reporters and setting up a news conference with Lesar. This is standard fare for most public companies these days, but it was new for Halliburton.

And, it turns out, it was a one-time event because of all the "political stuff," the spokeswoman told me.

Last year's meeting was a lively affair, as protesters tramped around outside wearing silly hats, waving banners and denouncing Halliburton's contracts to supply the military in Iraq and its link to the Bush administration through its former chief, Vice President Dick Cheney.

A couple wearing suits made their way inside, handcuffed themselves to a railing and doused themselves with fake blood. This time of year, Halliburton's annual meeting is the best circus in town. I had a professional interest, too. Given the 43 percent rise in Halliburton's stock price during the past year, shareholders have some reason to celebrate.

Also on the agenda is a shareholder proposal that would limit executive severance packages to three times an executive's annual salary. Currently, the company packages are about five times salary. Another proposal calls for all directors to be elected at the same time.

The company opposes both, as companies always do.

History of exclusion

No matter. The company is returning to the past, the dark days of 1990s-style corporate governance. It's a history steeped in exclusion, a time when public companies conducted their business with little regard for shareholders.

It was a time when executives had secret meetings with analysts, who in turn shared the private information with a select group of shareholders, who then benefited from that information at the expense of other investors.

CEOs closed annual meetings to the public, they communicated through obtuse news releases, they nominated their golfing buddies to the board. They ignored shareholder proposals, even when a majority of shareholders voted for them.

Just writing about it brings back a sense of nostalgia. In my old job, what I'm writing here was called a "hush" story.

Fair Disclosure

Back in the 1990s, before the Securities and Exchange Commission adopted Regulation Fair Disclosure, when we'd find a company barring the media from a shareholder or analyst meeting, we'd write a story about it. We'd point out that limited information meant limited shareholder benefit.

By prohibiting public access, the company in question was giving information that could affect its stock price to a select group of investors before everyone else.

This used to be common practice on Wall Street. It was, in fact, one way that big Wall Street firms made money. Reg FD and the advent of Internet broadcasts changed all that.

Most companies allow media access to their meetings. They Webcast management speeches and discussions with analysts. The result is a more level playing field for all investors, not just those who, in this case, are able to attend the meeting.

Little news today

It's unlikely Halliburton will commit news today. Other than a place to sit, those inside the meeting probably will gain little more than those outside.

None of which is really the point. By closing its meeting, Halliburton is embracing an antiquated ideal.

While I was flattered to be included in its exclusion, I declined Halliburton's offer to attend the hallway outside its annual meeting today.

I don't have to be left on the doorstep to recognize a closed-door attitude toward corporate governance.

• 174 War & Disaster Profiteers Campaign