Kai Ryssdal: The number of the day this Tuesday is a biggie: 659,210. That's the number of filings that public companies in this country made with the Securities and Exchange Commission last year.
As always when we have questions about corporate documents and what they mean, we've called Michelle Leder of footnoted.com, a virtual treasure trove of company filings. Hey Michelle, good to talk to you again.
Michelle Leder: Thanks for having me, Kai.
Ryssdal: So this 659,210 filings -- what's in there?
Leder: A lot of stuff, a lot of minutiae, quite frankly.
Ryssdal: But they are like annual reports, 8-Ks and all that stuff?
Leder: It's annual reports, it's 8-Ks, it's insider filings, it's credit agreements -- you name it, it's in there.
Ryssdal: A cynic would say that we are being buried with paperwork intentionally, that companies don't necessarily -- it's sort of like the late Friday afternoon document dump from the White House or something, right? The bad news dump. In that they don't want us to be able to read all this stuff.
Leder: I think that to a certain extent, it's probably true. When a company files a 4,500-page document, who do they expect is really going to read that? Probably not a lot of people; I'm certainly not going to read it. Even I won't read it, actually I should say.
Ryssdal: Whose job it is.
Leder: Probably some attorney who has to draft it. When you talk about the Friday night dump, what we found that was really interesting was that there was quite a number of these filings that were coming after 4 p.m. on a Friday afternoon, between 4 and 5:30. So the SEC doesn't stop taking filings until 5:30 even though the markets close at 4.
Ryssdal: You've been doing this for a while; Footnoted is like 10 years old now, right?
Leder: It is 8 years old, actually -- 8.5.
Ryssdal: Does the public know more about public companies now than it did eight years ago?
Leder: I think you'd be hard-pressed to say that. I mean, I think some companies are making efforts to try to be more forthcoming, but in general, there's just a lot of stuff that's just still buried in there. Without reading all of that 659,000 documents, you really can't say what you're missing, right? You can only, Kai, take a guess at what you think is in there.
Ryssdal: Give some examples. The worst one, the most egregious offender?
Leder: Well you know, we really liked ADP's disclosure this year, earlier this year.
Ryssdal: The people who the payroll stuff.
Leder: The payroll, yeah. Back in November, and they talked about normal succession planning was the reason behind why their CEO stepped down the same day that they announced it.
Ryssdal: Which doesn't usually happen, right?
Leder: Doesn't usually happen. You usually don't find CEOs of Fortune 500 companies walking away that very day. And what we found a little bit afterwards is that actually he had been arrested -- and it's not a funny story -- he had been arrested for domestic violence, and that was the reason why he stepped down. Now, would it have been that difficult for ADP to say, 'Hey, court situation, personal situation.' So why did they call it natural succession planning?
Ryssdal: Why don't they just do that, then? That's crazy.
Leder: Probably because some lawyer somewhere said you can't do that, or don't do it, or who knows. You don't know what's really going on behind the walls. There was also HP's severance package with Leo Apotheker; that was just out of this world. We started doing the math, and our calculator kind of blew up there. Somewhere north of $30 million for less than a year's worth of work. A lot of stuff there that you're just finding and it's all buried, and companies are just not going to put out a press release on probably 99 percent of this.
Ryssdal: Footnoted.com is the website. Michelle Leder runs it for Morningstar. It's always a good read. Michelle, thanks a lot.
Leder: Thanks for having me, Kai.