What Is Inside Information?
Inside information is material, non-public information that would be likely to have a significant effect on the price of a financial instrument if it were made public. Under the Market Abuse Regulation (MAR), issuers are required to identify it, protect it, and disclose it to the market as soon as possible. Getting that identification right is where most of the difficulty lies.
Below are the principal categories of inside information, with an explanation of each and a scenario to illustrate how it can arise in practice.
Categories and Examples
| Category | Explanation | Example Scenario |
| Financial performance | Earnings results that will come in materially above or below market expectations are inside information from the moment the issuer is aware of the divergence. Significant revisions to financial guidance or forecasts carry the same status. | A company's finance team knows, two weeks before the results announcement, that quarterly earnings will significantly exceed market consensus due to an unexpected surge in orders. That information is inside from the point management becomes aware of it, not when the accounts are formally approved. |
| Mergers and acquisitions | Plans for a merger, acquisition, or takeover, and the sale of a major business asset, are among the most commonly recognised forms of inside information. The information is typically inside from early in the process, well before any announcement. | An executive is informed that the company is in advanced negotiations to acquire a competitor. The talks are confidential and no announcement has been made. The information is inside regardless of whether a deal ultimately completes. |
| New products and R&D | Material developments in research and development programmes, whether positive or negative, can constitute inside information. Plans to launch a significant new product or service are assessed in the same way. | A pharmaceutical company receives regulatory approval for a new drug expected to generate material revenue. The approval is inside information from the moment the notification arrives. The issuer must either disclose promptly or assess whether a legitimate interest in delaying disclosure exists. |
| Strategic changes | Major shifts in the company's strategy or business model, including entry into or exit from a significant market or business segment, can be price-sensitive and must be assessed accordingly. | A board decides to exit a major international market representing a significant portion of group revenue. The decision is inside information from the point it is made, even while implementation planning is still underway. |
| Management changes | Planned appointments or departures of key executives or board members can materially affect investor perception. Where a change has been decided but not yet announced, the information is inside. | A chief executive informs the board of their intention to resign. No announcement has been made and no successor identified. The decision is inside information. The fact that succession planning is ongoing does not extend the window for non-disclosure. |
| Legal and regulatory matters | Pending or ongoing significant litigation, regulatory investigations, or anticipated fines are inside information where the outcome would be likely to move the share price. Settlements or resolutions carry the same assessment. | A company is close to settling litigation that has been noted as a risk in its accounts, but whose resolution terms are unknown to the market. Once terms are agreed in principle, the settlement is inside information. Disclosure cannot wait for the formal agreement to be signed. |
| Contract wins and losses | Securing or losing a major contract or order, and entering into or terminating a significant commercial partnership, can each be material depending on the size of the relationship relative to the issuer's business. | A defence contractor learns it has been selected as preferred bidder on a contract representing 20% of annual revenue. That selection is inside information, even before the formal contract is executed. |
| Dividends and capital actions | Decisions on dividend payments, changes to dividend policy, planned share buybacks, and decisions to issue new shares are all capable of being inside information before public announcement. | A board resolves to cut the dividend by half in response to deteriorating cash flow. The resolution is inside information from the point the decision is taken, ahead of any market announcement. |
| Operational disruptions | Significant operational events, including plant closures, labour disputes, supply chain failures, or major incidents affecting production or service delivery, should be assessed for price-sensitivity as they develop. | A manufacturer's largest production facility is shut down following a serious safety incident. As the likely duration and financial impact become clearer, the information meets the threshold for inside information and disclosure obligations apply. |
| Cybersecurity incidents | A material data breach, ransomware attack, or significant failure of critical systems can constitute inside information, particularly where customer data is compromised, regulatory notification obligations are triggered, or financial exposure is material. | A company discovers that a cyberattack has compromised a significant volume of customer data. As the scale and financial exposure become clear, the breach is inside information and MAR disclosure obligations apply alongside any sector-specific notification requirements. |
| ESG and sustainability events | Significant developments in the issuer's environmental, social, or governance position, such as a major regulatory sanction, a serious health and safety incident, or the failure of a key sustainability commitment, may be price-sensitive and require assessment under MAR. | An energy company receives notice of a substantial regulatory fine following an environmental breach at one of its sites. The fine and the circumstances giving rise to it are inside information pending public disclosure. |
| Credit and financing events | Covenant breaches, material changes to credit facilities, or decisions by lenders that affect the issuer's financing position can be inside information, particularly where they constrain the business or signal credit stress. | A company's finance team identifies that it will breach a financial covenant at the next testing date. Discussions with lenders have not yet commenced. The projected breach, and what it implies for the group's liquidity position, is inside information from the point management is aware of it. |
| Market conditions | Information about significant external market developments that would materially affect the issuer's operations or financial performance, and that is not yet in the public domain, can itself be inside information where the issuer holds it ahead of the market. | A retailer receives early data from a proprietary consumer survey indicating a sharp, unexpected fall in demand in its core market. Where that data is material and non-public, it constitutes inside information before broader market indicators reflect the same trend. |
Managing Inside Information
Identifying inside information accurately is the starting point for MAR compliance. Once identified, the obligations that follow - maintaining an insider list, assessing disclosure timing, and protecting confidentiality in the interim - depend entirely on that first assessment being made correctly and promptly.
InsiderList is designed to support that process: centralising insider list management, creating an auditable record of when information was identified and who held access, and reducing the manual overhead that slows teams down when deals move quickly.
