Oh the times, oh the customs! These days, with every Tom Dick and Harry CEO maintaining a Twitter account and public Facebook page, it’s easier than ever to violate the S.E.C.’s rules about where you can disclose key information so all your shareholders see it. That’s already gotten Netflix CEO Reed Hastings into a little trouble (not that his example stopped rogue Tesla CEO and would-be Martian Elon Musk).
Well today the S.E.C. announced that it’s a-okay to announce “key information” (like sales figures) via social media, “so long as investors have been alerted about which social media will be used to disseminate such information.”
So, to clarify:
“One set of shareholders should not be able to get a jump on other shareholders just because the company is selectively disclosing important information,” said George Canellos, Acting Director of the SEC’s Division of Enforcement. “Most social media are perfectly suitable methods for communicating with investors, but not if the access is restricted or if investors don’t know that’s where they need to turn to get the latest news.”
In other words, an announcement from the company’s designated Twitter feed is fine, but no random personal Facebook updates, even if you have a quarter of a million subscribers. Okay, Reed? Think you can handle that?
(h/t Anthony De Rosa)