Should companies begin to use social media to disseminate financial data?

Companies should release financial information on social media because more customers will look for it there. However, they should be very careful to make sure that strategy is a good fit and that all executives understand the rules.

Yes

Jason Ouellette VP, PAN Communications
More than 15 years' experience working with b-to-b tech firms on internal and external comms and digital relations programs

We are living in a world that is being reported on 24/7, allowing you to reach a large audience in seconds.

With the SEC's recent announcement that public companies may now use social media outlets to announce key information to investors, publicly traded organizations have the chance to get in front of current and potential future investors using the channels that they use to consume news today.

One of the most important elements of successful brand management and overall marketing communications is targeted engagement.

As PR professionals, we guide clients and companies through the social media landscape and help them promote and engage through the plethora of media at our disposal today.

So why is one type of communications worthy of the social media world and others not? We are in the midst of a complete digital disruption when it comes to information. The brands and people that are transparent, open, and willing to take real-time feedback are the ones that stand out today.

We are no longer in a position to pick and choose what information is made public via social channels because we no longer manage the release timeline - your followers do that.

If you're not embracing social media in all of your communications, there may be a perception you're hiding something or you're dated. By releasing financial information through social, you're allowing your community to have the details they need to make their own decisions.

What you're also making a reality is real-time feedback and sentiment analysis of what it is you're releasing. There are some great tools on the market that allow us to follow social media trends and figure out what our followers are looking for.

Two of the main benefits of social media and digital engagement are represented here: real time and community.

By embracing both, you're putting your brand in a position to engage and create a two-way conversation that will ultimately show your ability to communicate in real time and lead to deeper brand loyalty by consumers that matter most.

No

Edie DeVine VP, GCI Health
Fifteen years' experience navigating SEC inquiries and has helped six companies go public, raising $750M

Disseminate your information broadly and fairly - Fair Disclosure laws exist to ensure this. And unless your Facebook page is as well-liked as Reed Hastings' - the besieged CEO of Netflix whose Facebook posts were at the root of the Securities and Exchange Commission ruling on the issue - then your company should steer clear of sharing material information on a social media channel without using a proven disclosure vehicle first.

The SEC made an important concession last month when it declared financial information can be disclosed on social sites as long as investors are alerted to where to find it.

While many are praising the guidance, some IR pros are quick to point out the potential confusion and hazards - particularly for recently formed public companies that may not be as familiar with best practices for disclosing material information and the nuances of Regulation Fair Disclosure.

Every company has its own interpretation of SEC guidelines, but when posting financials on a website or a social channel, the onus will be on the business to prove fair disclosure.

Many corporate brands that rely and thrive on high online engagement - such as Apple, Google, Ford, and Netflix - can do just that, but no company wants to be on the receiving end of an SEC inquiry. And once you use a new channel, the expectation is that the organization will continue to do so. The commitment of resources is an additional consideration.

Beyond the SEC, there is a danger of sharing the wrong message with your audience.

Many companies should be wary of disclosing financial information through customer platforms as this can have a negative connotation, impacting corporate reputations and customer relationships.

Social media has a very important place in the world of communications, and right now it is not a channel for financial communications. Disclosures of this type on social platforms may be appropriate for select brands, but the majority of publicly traded companies should maintain a proven approach to ensure fair disclosure. 


PRWeek's View
Companies should release financial information on social media because more customers will look for it there. However, they should be very careful to make sure that strategy is a good fit and that all executives understand the rules.

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