Abstract
Social media networks offer a tremendous opportunity for the dissemination of financial and other information globally to companies. It can be immensely useful for stakeholders and investors too. So far its permitted use as a primary disclosure channel is restricted. Some risks also exist through inadvertent disclosure of information, as well as potential share price manipulation, yet are companies necessarily aware and armed to handle the risks? This research conducts exploratory research into the attitudes of Nordic companies, in a region where social media primary disclosure is not permitted, to analyze the status quo and consider any risks that may prevail. Possible action changes and future research opportunities are also examined.
TopDisclosure
Transparency and equal access are two fundamental principles crucial to financial information and its disclosure -- covering both existing companies whose shares are publicly traded as well as those seeking a market listing (Guimard, 2013).
Key Terms in this Chapter
Jigsaw Identification: A method for identifying a piece of information from two or more different (often unrelated) sources where the information’s release was not intentional.
Distribution – Information Distribution: The process of delivering disclosure information to recipients. This is often mandated to a certain minimum audience, with the intention that all outlets get access to the information simultaneously and on comparable terms. This process may also stipulate certain language, style of presentation and usage of commonly accepted terminology to avoid misunderstanding.
Disclosure – Manipulated Disclosure: The disclosure of information by malicious means, whether by the disclosing party or aided by external events such as hacking, where the intention may be viewed as malicious or knowingly aimed against the company’s interests and intentions.
Transparency: A principle or state whereby investors and other interested parties have equal access to financial information about a company, often complying to standard forms of presentation. One key value is the ability to base investment decisions on the same data as other participants.
Disclosure: The release of information (by a company) that may influence an investment decision. This is often regulated by law and/or stock exchange rules to ensure harmonized compliance.
Disclosure – Inadvertent Disclosure: The disclosure of information, possibly by accident by an employee or the company in question that may be viewed as sufficiently relevant to otherwise require disclosure through formal disclosure channels.
Open Source Research: Activity of using publicly available information from multiple sources that, when combined, may give a deeper insight than intended by the subject.
Investor Relations: A term relating to the strategic management action that coordinates and processes financial and communications-related activities to regulators, stakeholders, shareholders and other interested parties. The same term can be applied to employees, a specific department, or third-party organizations that communicate and handle related inquiries.