(BFM Bourse) – For listed companies, social networks have established themselves as complementary tools to the channels for disseminating regulated information. CAC 40 companies have adopted these new modes of communication and have at least one Twitter or Linkedin account. But disseminating this information on social networks is not without risk.
Social networks (Twitter, Linkedin, Facebook…) have established themselves as an essential relay of information. Especially for listed companies that use these means of communication to disseminate their information that they consider most crucial, instantly and to as many people as possible. And investors are sensitive to it. They are more likely to react to messages broadcast by listed companies containing visual elements or precise financial information, according to a study by the Bayes Business School published in early October.
A tweet that mentions, for example, a turnover will have more impact than a publication that does not specify the level of sales of a company. The difference can be up to 22% on the rise or fall of the stock market price of the company, reports Paul Bilinski, the author of the study.
On the other hand, investors shun publications that pay too much optimism but appreciate tweets that include images or videos, because they capture their attention, also reports the study.
A handling of social networks that is not without risk
If these new modes of communication massively help the dissemination of financial information of a listed company or the statements of its management, “the handling of these new media is not without risk and without impact on the stock market price” , recalls Nisa Benaddi, partner at EuroLand Corporate. It recalls the rules and best practices applicable in France in terms of financial communication on social networks:
> Not to disseminate privileged information on social media unless it has previously been the subject of a press release with effective and complete dissemination;
> Reminder of the existence of the issuer’s various accounts on the company’s website in an easily accessible section;
> Active monitoring in order to find out what information is circulating on social media and to react quickly in the event of a rumor referring to privileged non-public information (deferred information) or hacking;
> Ensuring the traceability of privileged information published with, in particular, the use of a hashtag of the type (#codeMnemo) or (#OfficialAccount);
> Certification of social media accounts (official account, certification by the network, etc.);
> Implementation of a charter for the use by managers and employees of their personal accounts to make them aware of communication issues and remind them of the caution with which they must use these networks;
- > Vigilance as to the detailed nature of the information disseminated so that it cannot be qualified as misleading and systematic establishment of a link to the press release with effective and complete dissemination, source of the information.
Social networks have established themselves as a formidable tool for the rapid dissemination of information to as many people as possible. But they can turn against the listed company and add an additional risk factor to its financial communication.
“Financial communication on social networks is not without risk for listed companies and their representatives”, reports Nisa Benaddi, who identifies several vigilance factors for the company concerned. In addition to being confronted with risks of price manipulation of which they may be victims without their knowledge or of theft of their identity, they must also take care to lock their communication internally in order to avoid any leak of data information. sensitive.
The specialist recalls that the full and entire responsibility of the executive corporate officers remains engaged. This responsibility prevails even when these people express themselves on personal accounts, “given the open nature of social networks”.
“On the side of social network users, they are subject to an ever-increasing number of positions expressed by other users regarding their feelings and their opinion through tweets or posts,” recalls Nisa Benaddi. “All these interactions influence, sometimes significantly, their choices and can blur their free will in favor of the voice of the greatest number or an emblematic person, which can have an impact on the price of the issuer” she continues.
The Autorité des marchés financiers oversees the application of rules of good conduct on social networks. As early as 2014, the stock market watchdog had issued a recommendation aimed at regulating the use of social media in the financial communication of listed companies. It was replaced in July 2016 by the so-called “Market abuse” regulation.
Sabrina Sadgui – ©2022 BFM Bourse