RegFD faux pas is the least of General Counsel’s social media worries

At this week’s NYSE Governance’s General Counsel Forum, I was fortunate to attend the best social media panel I have ever heard.  And I’ve heard a lot.

Why was it so good?

  • Extremely refreshing to meet General Counsel who embrace social media’s fluidity and who proactively work to mitigate social media risk without neutering it’s potential
  • Reaffirming for the investor relations’ practice that GCs trust IRO’s judgment towards the disclosure of material non-public information via social media
  • Embarrassingly obvious how myopic we “IR service providers” are in regard to social media

Extremely: The number one social media challenge for companies is far from RegFD slip-ups. For social media, GCs are focused on the triage of privacy, ethics and policy management – all to keep their organization from the ever-present microscope of the National Labor Relation Board (NLRB). Social media policies typically restrict what employees can say about their company. However, due to Section 7 protections, the NLRB scrutinizes such policies heavily, especially if a policy infringes upon speech about working conditions. Free and protected speech must be just that. Free and protected. This is the stuff of HUGE lawsuits. Hardly a the blip of a Wells Notice.


Reaffirming: After the formal presentation, I spoke to GCs about IR. None of them had an iota of anxiety about the disclosure of material non-public information via social media. They all stated that – as far as they were concerned – social media is no different from any other disclosure channel… and that IR knew what was needed in regard to RegFD. To quote: “We can simply protect ourselves with an 8-K if there is an issue.” BAM!

So, what are the shareholder communications take-aways from the session?

  • Monitor the socialsphere. All the GCs on the panel do that within their legal department. They don’t leave it to PR or marketing. This is particularly important to the financial services organizations that are required to act on a “nasty tweet” as a formal customer complaint. GCs recommend using a pay-per product [like our Agility] or free services like Google Alerts.
  • Social media has made crisis communications a real-time event. You cannot sit around for three days and draft an action. You have to work at the speed-of-web. Be cognizant and staffed for that. Don’t hire “college interns” to “do social media.” They will know the technology, but lack maturity.
  • You cannot regulate employees’ social media use. You can guide them, offer true-life examples and explain the risks you are trying to control and how it impacts success – personally and collectively.

Embarrassingly: Is social media important to IR? Yes! No! Maybe! Find the path that works best for your shareholder communications strategies and goals, whether you want core hands-free auto-post tweeting, schedule pre-scripted tweets around the earnings call or fully embrace consistent conversation. Social media channels are far too fluid for any advice to be solid from one week to the next.

  • No matter what else you read, there is only one “IR and Social Media Best Practice” to follow. Use your $cashtag, otherwise you are wasting your time.
  • But, hey, don’t listen to me.

Have a great weekend.

4 responses to “RegFD faux pas is the least of General Counsel’s social media worries

  1. Awesome. Did you ring the bell?

  2. Hello (again) Geoff ~ No. The team did ring the opening bell that day, but did not attend that. I did get to dine in the Boardroom – which was like the Palace of Versailles. I can see why NASDAQ always has such esteem envy.

  3. Pingback: Board Directors now discussing more pro – than con – of social media | Building Shareholder Confidence

  4. Pingback: What IR and general counsel need to know about Twitter’s new direct message policy change | Building Shareholder Confidence

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