By Mikhail Raj Abdullah

The code of ethics for journalists is undoubtedly applicable and relevant for business and economic news reporting as well because it cuts into the realm of financial integrity.

Journalists, including reporters who cover the stock, financial and commodity markets, editors, sub-editors, and even copywriters – all have a responsible role to ensure fair reporting. In doing so, they somewhat guarantee that the public gains access to useful and relevant information to make wise and informed investment decisions, so to speak.

Obviously, this is a challenge amid the modern era of social media, which has crept into being an integral part of journalism and news reporting. The media fraternity now comprises not just reporters from mainstream news organisations, but also influencers, bloggers and writers from news or information portals and websites, and even your neighbourhood citizen journalists.

With so many new players and the advent of interactive journalism, they pose immense challenges for bona fide media personnel in adhering to the code of ethics, even in business journalism, because of the "free for all" nature of these purveyors of "news" (rpt) "news" or journalist-wannabes.

BEWARE OF MARKET MANIPULATORS AND INSIDER TRADING

To be specific, one of the pitfalls for business journalists is the risk of falling into the trap set by unscrupulous stock market players who lean toward insider trading or manipulate stock prices. They "operate" by disseminating information or news that is intended to either lower or push up prices which they will eventually profit from through their stock or commodity positions. For example, some reap profits from the dissemination of negative news or information with the hope that when the price of a stock or commodity goes down, they can stand to gain from buying on the cheap and selling it when prices are higher.

On the other end of the spectrum, you have people filtering in statements, rumours or speculation about certain lucrative market or corporate manoeuvres, perhaps a proposed acquisition or merger, which might send certain shares spiralling upwards. When this happens, it allows market manipulators to unload their shares at a big profit for even a movement of a few sen could turn out to be a bountiful bonanza for them when they deal in millions at the stroke of a decision.

In such cases, the journalist must be vigilant, well-informed, and aware of these unscrupulous tactics to ensure that information about mergers and acquisitions is genuine. This vigilance helps prevent them from being deceived into writing about deals that primarily benefit market manipulators.

As far as the manipulators are concerned, their actions can be described as unethically wrong though it could be difficult to prove that they had been manipulating behind the scenes and engaging in insider trading. This is where journalists have to exercise great caution to not be misled by those with vested interests into publicising false information to the detriment of the public, especially the minority shareholders.

Our job is to disseminate the right information to the public so that they make informed investment decisions and not lose money because of some vague or unfounded rumour.

CORPORATE RESULTS AND COMPANIES SEEKING TO ONLY HIGHLIGHT POSITIVE NEWS

As many business reporters and news editors will attest to, sometimes companies try to influence the media by providing figures that portray the "good side" of their finances. Some public relations consultants or marketing communications executives of listed companies are often "serial executors" of such improper conduct but then again this is not limited to them only as some government agencies and even regulatory authorities have also been complicit in exerting undue pressure on the media. They go to the extent of insisting that the media use only a certain set of figures and ignore other figures which tend to expose an organisation's financial weaknesses. They go to the extent of asking the media to just provide only percentages of the changes in performance and not the absolute numbers or not giving comparative figures, which will show clearly whether they have performed well or otherwise.

This is certainly not right. And talking about ethics, this is where business reporters or those running the newsdesks must put their foot down, and say no to adhere to basic tenets of good journalism. They should rightly highlight the good and the bad, and let their readers make their own choices about a company's financial strength.

While public-listed companies can issue well-crafted one-sided press releases to sway or influence their audiences, a complete set of financial results – quarterly, half-yearly and annually – are readily available on the Bursa Malaysia website. So, primarily there is no need to merely depend on PR handouts from public-listed companies for a journalist ought to exercise his or her integrity and responsibility to report what is available on the public domain.

This can be likened to fair reporting. And journalists owe it to their readers, who include shareholders, especially the minority ones, to report fairly and accurately. This certainly ties in neatly with some of the fundamentals of the code of ethics for journalists which emphasise the responsibilities and standards expected of journalists in Malaysia, including being the voice of society, transparent and being fair, and not allowing personal interests to influence the news writing.

ARE MOUs GENUINE STUFF OR DOCUMENTS TO PUSH THE MARKET?

Signing Memorandums of Understanding (MOUs) is a common practice in Malaysia, especially with foreign companies and entities. If the MOU progresses and advances to the signing of concrete agreements leading to the taking off of projects, then it is well and good.

But there has always been a disquieting feeling that MOUs mean nothing much unless they translate into something concrete. Again, they could be ploys to shore up share prices if the companies or projects concerned are linked to some major personalities, tycoons or politicians. This is again where a certain amount of inquisitive responsibility is needed on the part of the business journalist to sieve through what is genuine and what is not. More often than not, we hear of pledges to invest "billions of ringgit" in MOUs for certain proposed projects by relatively unknown or obscure companies.

To put it bluntly, this zest to ink and publicise MOUs could be just a gimmick to seek endorsement to seek loans from financial institutions since some level of credibility could be accorded to these companies since their "proposed" projects are already in the news!

BUSINESS JOURNALISTS CANNOT BE MARKETING PRODUCTS AND SERVICES

Business journalists should not market a company’s products or services, as the media must remain independent of any particular source. They should also be cautious not to write about so-called 'business ventures' that, upon closer investigation, are revealed to be Ponzi schemes disguised as marketing gimmicks.

In economic news reporting, it is good to exercise extreme care and responsibility to avoid alarmist types of stories. Economic policies and measures take time to show results and until such time, such news writing can be critical but calling it a failure even before it gets off the ground can be utterly unfair.

As such, the code of ethics for journalists underscores that great responsibility on the part of the journalist to verify the validity and accuracy of the information at all times.

-- BERNAMA

Mikhail Raj Abdullah is a Special Writer with the BERNAMA Economic News Service.