Shareholder activists have made effective use of social media platforms in their campaigns, but corporations have been slower to adopt non-traditional channels of communications with investors. According to this Corporate Secretary article, that’s another thing that’s changed due to the pandemic. Here’s an excerpt:
Historically, shareholder activists have been better at using social media and digital communications tools to wield influence during a contested situation, with many issuers taking a conservative approach to social media and digital communications. But the pandemic has forced a greater adoption of tools such as videoconferencing and social media communications, and Bruce Goldfarb, founder, president and CEO at Okapi Partners, says he’s seeing more adoption of social media this year.
‘There were some companies that used social media as part of their IR process prior to the pandemic – especially companies that already made use of social media in their marketing and sales efforts – but investors would much more frequently file materials they had posted on social media,’ he points out. ‘More companies have recently done so, and that evolution is at least partly attributable to the pandemic.’ Goldfarb adds that he is seeing more examples of additional proxy materials being filed with the SEC this year – particularly LinkedIn and Twitter posts.
The article says that companies are increasingly open to alternative channels of communication with shareholders, and that social media could be a particularly useful tool for shareholder engagement by companies that have seen a big jump in retail investors this year (gee, who might they be referring to?), but that they need support from their advisors and outside counsel.
– John Jenkins