Just be sure to tell your investors, first.
In a move that aligns the Securities and Exchange Commission a bit better with the world of social media, new disclosure rules now outline how companies can use social media platforms like Facebook, Twitter and others to disseminate information as long as they meet certain requirements.
Here’s the word on the SEC social media decision from the SEC themselves:[quote author=”- Securities and Exchange Commission” style=”1″]The Securities and Exchange Commission today issued a report that makes clear that companies can use social media outlets like Facebook and Twitter to announce key information in compliance with Regulation Fair Disclosure (Regulation FD) so long as investors have been alerted about which social media will be used to disseminate such information.[/quote]
Bottom line: 1. Reach milestone. 2. Call investors. 3. Compose tweet, hashtag #WeRock and fire away.
This all comes in response to a warning issued in December to Netflix. Regulators warned Netflix that they could take action against the company for a 43-word message that the company’s chief executive, Reed Hastings, posted in his personal Facebook wall. Hastings was apparently excited and congratulated his team for exceeding one billion hours of video views in a single month. Hey, congrats. That’s a big deal. But the feds said that was a mistake.
Normally an announcement like that would have to meet the Regulation Fair Disclosure, or Reg FD. That requires a company make an announcement but also include investors so they know what’s going on. We don’t know if Netflix investors are some of the 200,000 ‘friends’ of Hastings (well, we’d hope so as he seems like a popular guy), but based on pre-social standards, this would be seen as a no-no and would have had to have been disclosed in a securities filing or a news release at the very least.
This isn’t Boiler Room. I could see Seth Davis over at J.T. Marlin firing off a tweet (if it was around in 2000) about Farrow Tech to the masses without informing investors. (If you haven’t seen the movie, I recommend it.)
Sorry for my random movie reference.
Either way, It seems the S.E.C. is relaxing the rules a bit. But it’s also good to see that the SEC is learning to take old rules and find a way to make them work in a the fast-pace, social-savvy world of social media.