It appears that social media, particularly in the form of blogs, can now be used by public companies to meet their public disclosure requirements. Neville Hobson has reported the story on WebProNews.
Yesterday, the US Securities and Exchange Commission (SEC) approved new guidance for publicly-listed companies in using traditional websites and social media channels like blogs to meet the SEC’s public disclosure requirements under Regulation FD.
This brings the SEC into the 21st century and more importantly, recognizes the widespread use on the internet. Blogs will most likely go through another commercial spurt, this time from public companies.
Neville makes two observations:
- This could be the moment, the tipping point, when the social media news release really comes into its own, given its purpose of presenting news and information in a format that is designed for online interactivity.
- It could well give a kick in the pants to how corporate websites are managed and controlled, opening up the development of those sites into genuinely interactive and useful tools. A bit like how blogs work in many ways.
They are both salient points. Social media will now grow stronger with some sites no doubt trying to capitalize by developing dedicated sections to news releases and public disclosures. However, as mentioned in the second point, blogs will be the real winners in the longer term because of the control that goes into publishing them.
A side issue that should be worth noting. As public companies start to use social media for public disclosures and press releases, they will need to beef up their online reputation programs to ensure nothing getting out of hand due to a poorly worded or interpreted release of information.
