Sifting through the noise part 3: PGi weighs in on SEC release for using social
16 May 2013
In the third part of this series, Sean O?Brien, EVP Strategy & Communications at Premiere Global Services, Inc. (PGi) shares his insights on the SEC release. Of note, during this conversation, we talk a bit in detail of the merits of having a dedicated Twitter account (see question #3). We have previously discussed this topic with WWE in a two-part series on our blog:? Part 1. Part 2.
In the research we are doing at Q4, we are finding that while some early adopters of social IR are continuing to strive for new ways to use those channels further strategically, some others have dropped off the radar. PGi is a power user and have a dedicated investor Twitter account, which is a best practice that we recognize.
1. What is your initial reaction to the SEC?s release?
It is very positive. PGi was an early adopter of using social tools to communicate with the investor community. We are big proponents of leveraging technology ? specifically communications technology ? to create more full and fair disclosure with our investors. We applaud the SEC for its decision, as clearly, this is bringing investor relations into the 21st century.
2. Will the release change anything that you?re doing now or in the future?
PGi helped pioneer many of today?s common Social IR practices, and that was not without risk for us. We took a forward-looking approach toward leveraging new technologies and embracing new channels of distributing information, and we will continue to grow our social footprint. We want to develop as a thought leader in the space, help drive the adoption of these technologies and build our voice in the social IR spectrum within the investor community.
At the same time, we want to continue to enhance the relationships we have already established in social media. For example, PGi has a small but growing following on our Twitter investor handle (@PGiInvestor), and we are actively trying to build an audience. We also have a rapidly growing community that is following us on StockTwits. We are looking at ways we can actively build that audience as well.
Our goal for social media has shifted from making the information available to investors to now focusing on how we can build our audience and actively engage them in an ongoing, two-way dialogue.
3. What do you think the trend will be going forward for companies using social for IR?
PGi was one of the first to create a separate Twitter handle specifically for investor news. Part of it was that we wanted to make it very clear to investors where we want them to engage with us. It was also important to separate our news feeds to ensure everyone gets the information they are looking for; a lot of information on our general corporate handle is not very relevant to our investors, and vice versa.
One of the reasons why many IROs start using social media and eventually drop out is that they cannot clearly see the value their program is delivering to the investor community. Oftentimes social engagement can be passive, and unless you take an active role, you don?t know how many people are using your social feeds to digest your relevant corporate information. For example, a lot of our investors and analysts don?t follow our updates directly on StockTwits, but they enjoy the updates we post through the StockTwits platform on the Yahoo! Finance Market Pulse page.
I saw in a recent report that almost 40% of public companies are using social as a part of their IR strategy, which is huge growth from when we started. I think a lot of IROs were waiting for some clarity and guidance from the SEC because the IR profession by nature can be fear-based. IROs walk a tightrope of wanting to all play by the rules, but oftentimes, we are faced with regulations that are big and scary and not clearly defined. Reg FD can be difficult to navigate, and when you get into the social world, you are dealing with even greater uncertainty. Many of us had to take a leap of faith and bring along our legal teams and compliance departments when we added a social component to our IR programs.
The recent SEC ruling recognizes that social media is a legitimate way of distributing information as long as you are clear with your investors. It gives us a mandate to leverage social disclosure as part of a comprehensive IR program to drive incremental value for current and potential future investors by building out our communications strategy with these technologies.
4. There are a handful of companies that are filing 8-Ks that are disclosing the social channels that they are using. Are you guys planning on disclosing your channels in an 8-K or just continue on? It is obvious from your investor homepage that your company is quite active on social but do you anticipate having to use an 8-K now?
We want to be inclusive, not exclusive, in how we distribute relevant company information, so at this point we are going to continue to do a bit of everything: press releases, 8-Ks, social media postings, along with other traditional IR distribution methods like investor conference calls. I don?t think that we are going to stop anything we are doing anytime soon.
For me, social IR is less about which technologies you use to distribute information; it?s more about a mindset ? a commitment to full and fair disclosure and a willingness to meet investors where they prefer to consume their information. This mindset challenges us to disclose more information and make our business even more transparent, while getting this information out as broadly as possible in the most timely and cost-effective manner. It?s a big challenge, and as a result, we are not going to stop using traditional means of IR communications anytime soon, even if our efforts are a bit redundant.
5. What value do you see in social media for IR?
Social media is where many of us are living our digital lives today. People from all walks of life are becoming increasingly comfortable and savvy at gathering the information they need through social platforms.
IROs are adopting social tools to tap into this growing trend, and because these technologies provide an easily accessible means to broadly distribute information in a timely, cost-effective manner, which is key to an effective IR program.
The fourth and final interview with Heather Hunter, Director, Marketing Communications at Safeguard Scientifics will be published on Friday, May 17th?