Are You Ready to “Friend” Wall Street?
My mother “friended” me on facebook the other day. I’m ok with this – I like to think I don’t have any secrets to hide, and if I did I wouldn’t be sharing them with 500 hundred of my closest “friends” at the same time.
My point: My mother is out there now, so I assumed that means almost everyone else is as well. You’d probably agree, right? Well, we’re both wrong. One of the biggest businesses out there – one that has typically been at the forefront of most marketing and technological trends – is still a laggard in social media. I’m talking about Wall Street.
For a range of reasons, though mostly legal, most of the big financial firms have been slow to embrace a trend that has seemingly seeped into every other corner of the business world. Here’s the problem: the world of finance (the sell-side in particular) is heavily regulated in terms of how companies may communicate with the investing public. The rationale behind this is sound and well meaning, but there’s no question that it has also left a void in a key industry.
That may change soon as the Federal Financial Institutions Examination Council (FFIEC) is in the midst of a public comment period relating to potential guidelines for the use of social media by financial institutions. Slowly but surely, it appears we may be on the path toward a more active world of financial social media.
It’s difficult to make assumptions about future rules to set a viable social media policy, but there are certainly key issues that will have to be considered as financial institutions consider delving deeply into the world of social media:
Who may participate?
One of the key attractions of social media has been the ability to hear directly from thought leaders and other influencers, without a layer of corporate beauracracy in between the sender and recipient. Firms will need to set a policy giving specifics – with little room for confusion – as to who may speak and in what capacity.
How is it controlled?
In an industry where most communications with the public are subject to legal review prior to delivery, policies will need to be implemented that provide this review without sacrificing any of the immediacy that the message might demand.
How much to say? And to whom?
As always, a balance needs to be maintained between sharing pertinent information while also maintaining value for paying customers. In this case, something like Twitter may be ideal for the delivery of messages like, “Analyst XYZ sees today’s sell off as overdone, here’s why:” followed by a link to a secure website only open to firm clients.
When to say it?
In addition to managing a firm’s social media presence in the context of the broader compliance regime, guidelines will need to be set to ensure that spokespeople properly calibrate their presence while also maintaining proper due diligence, and avoiding carrying on conversations through media that would be better taken one on one.
Without a doubt, there are still exciting things happening in the world of social media. Bringing more financial institutions to the party promises to make things that much more interesting. What do you think, are we ready to be “friends” with Wall Street?