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Industry News – IROs yet to catch the social media bug
October 4, 2013
Across the communications industry, social media has become an important function for disseminating information. However, a recent survey conducted by the National Investor Relations Institute (NIRI) found that most investor relation officers (IROs) refrain from engaging in social media for the primary reason that they are not seeing investor interest in these channels. In fact, more than 75% of the 227 IROs who responded to a NIRI survey said they do not use social media.
The overwhelming majority was consistent through varying market caps and geographies, although large cap companies were found to be slightly more likely to use social media.
Another survey of buy-side professionals found that out of 350 surveyed, only 41 respondents used social media. Of the limited amount of users, most recognize Twitter as a source for news and 56% of respondents follow up on news tweets by clicking on the link included in the feed. However, the legitimacy of news tweets are often called into question, with 92% of professionals concerned about hoax tweets and security issues.
Perhaps the lack of social media usage in IR can be explained by the third of investment firms that do not allow the use of social media on company computers. While personal smart phones could offer a simple solution to the problem, IROs are still not seeing active social media platforms in the workplace.
Yet, this gap in embracing technology does not seem to concern industry professionals. The IRO for EMC did his own survey of his 1,000 investors and found there was no demand for disclosure through social media. IROs believe that the lack of interest can be attributed to the massive amount of information and sources investors already have to follow on a regular basis. From this perspective, social media may be seen as another blanket of words for investor eyes to graze.
This article was written in conjunction with the National Investor Relations Institute magazine article “Social Media: Cause of Pause” by Marj Carlier.