New Reg FD guidelines call for a shift in mindset
I’ve been reading quite a few great and not-so-great posts over the last few weeks about the hub-bub with the new SEC guidelines surrounding Reg FD. These discussions have ranged from the ‘death of the press release’ (a topic for another day) to investors thinking this means they will have to visit several company websites to get investor information. Most folks seem to be focusing on the vehicle and not the controls, the way information is distributed on the internet has changed drastically over the last several years so the vehicle is the easy part, the controls behind how content is created is what matters. Read more after the break.
For the sake of this post, I’ll focus on a couple of interesting comments I read on Dennis Howlett’s blog. You can read the full article here ( http://blogs.zdnet.com/Howlett/?p=446 )
On to the comments:
- … a senior executive in a large company said: “It’s not the technology that worries me, it’s the change control to ensure we don’t shoot ourselves in the Sarbanes-Oxley head.” …
Having worked for a social media company I know first hand the problems issuers face with e-Discovery and the incredible machine behind 1 single CEO blog post. It was not un-common to work with a team of 5 or 6 people who were dedicated to one CEO blog.
I agree with the statement that the technology isn’t the problem. After all, RSS and blogs have been around for ages but the IR world has been slow to adopt these technologies – fearing the un-certainty that goes along with implementing a new disclosure practise.
The second statement is the one I fundamentally disagree with:
- If the tech sector can’t get its social media act together then what chance does the rest of the world have?
I don’t think the problem is with social media. The problem lies with the market changing their mindset around how information is disclosed (to keep pace with the way the general population accesses content online) and how they can ensure the proper controls are in place for the distribution of this information.
Distributing information through newswires, RSS, email alerts, blogs and through corporate websites is the same. Once the data is on the internet, it’s there and the way it got there doesn’t really matter. What DOES matter is the controls in which the data was created in the first place.
While I hadn’t intended for this post to be a Q4 product plug it’s a bit hard to NOT plug our products as we have long recognized the inevitable legislative changes to web disclosure, and have been creating products to help issuers control risks in this regard.
Right now I’m using Q4 PRESS to write this blog post. For those not familar with Q4 PRESS, the reader’s digest version is that from conception to finalization, every piece of text that has changed in this blog post is tracked and we know exactly who did what and when they did it. The Q4 management team are set up as ‘approvers’ and we have a solid record of how this post was created.
Like I said, the vehicle doesn’t matter, the controls do.
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