Adjusting to the SEC's New Social Media Policy
This week, the SEC released a new social media policy clarifying the terms of what can be shared on social networks and when. The last time the SEC released guidelines on the distribution of company information online was back in 2008, when sites like Facebook and Twitter were just getting started. According to the new policy, companies are now allowed to distribute significant information to the public via social media, as long as investors are informed of this strategy beforehand. The SEC's acknowledgment of the shift from traditional to digital platforms underscores the growing transparency that social media has brought to some of the world's biggest corporations.
What do these rules mean for us, as an agency that oversees the social media accounts of our clients? The answer is change, as we help clients adapt to the new SEC policy. We are working with our clients to ensure that they alert investors to their plans to use social media outlets for announcements. Clients who have multiple social media profiles rely on us to help determine the best strategy for disseminating information. While Facebook and Twitter are the most popular social media sites, we encourage clients to use whichever networks are best for their purposes, even including Instagram or Orkut. For companies that wish to create separate corporate accounts specifically for announcements to investors, we can claim, develop and manage these profiles. The change means similar changes for RepEquity. We will need to decide whether to share with our investors information via social media, and alert our investors of our policy.
Companies should also be mindful to not share information that the SEC deems 'company announcements.' For example, last year Francesca's Holdings CFO Gene Morphis tweeted, 'Board meetings. Good numbers = Happy Board' and was subsequently fired for sharing non-public information.
What do you think about the SEC's policy change? Can the new policy, as it stands, work for social networks that may emerge in the next few years? Should investors be required to like and follow the social media profiles of all companies in which they invest?