SEC Outlines Rules for Corporate Social Media Disclosure
Recently, the United States Securities and Exchange Commission (SEC) went about releasing a brand new set of disclosure rules for social media that detail specifically how businesses can use sites like Facebook, Twitter and a variety of other social networks to share information according to the Commission’s guidelines and requirements.
Now, it looks like members of a company’s c-suite will be free to write a Facebook or blog post if they way; they just have to inform their investors about their “social media strategy” beforehand. It is believed that this change will reduce some spontaneity and limit a company’s social communications to official corporate accounts.
Apparently, the SEC worried that company-related posts from chief executives may violate its Regulation Fair Disclosure act, which ensures that a company publishes all of its information to all investors at the same time, such as in a securities filing or news release.
However, following several months of investigation, the SEC decided that companies can use social media sites as “legitimate outlets” for communicating with investors, just like they would with their corporate websites or the SEC’s public filing system, Edgar. That being said, the SEC does state that corporations must make it clear which of their Twitter feeds, Facebook pages, etc. will be used as outlets for announcements.