The Hastings Facebook page kerfuffle: more context

I've just read Broc Romanek's post on TheCorporateCounsel.net from earlier this week: "RIP? Social Media Use for Corporate Disclosures."

Hastings fu SEC postThe title is broadly worded, probably because the incident falls into a category Romanek posts on frequently, but the post itself digs into the controversy over Netfilx CEO Reed Hastings' use of Facebook to make company disclosures, something the SEC has called out.

Two posts on this blog, "Disclosure out of sight" and "Reed Hastings' 'public' Facebook page," got some great discussions going, and bridged over to a deeper discussion on Kid Dynamite's blog. But I think those discussions are missing important context and nuance that Romanek provides.

Romanek suggests that the SEC is targeting a company that is overall actually egalitarian about disclosure: "Netflix is one of the only high profile companies that is friendly to retail investors. They accept retail investor questions on their conference calls via email and make the analysts wait on the call until all the emailed questions are dealt with."

That sounds pretty cool and investor-friendly.

Romanek touches on the use of investor relations pages on corporate websites, then concludes, as many in the tech industry have, that the SEC needs to get more current about what the internet is today:

"The SEC needs to evolve and regulate more broadly. Get away from the hyperfocus on the disclosures it forces to be filed on Edgar. Focus more on what investors actually bother to read. Don't punish the companies that want to reach investors in the manner that today's investors consume information."

I still have problems with a public company treating a closed community as though it were a public forum. (Though I clearly see I can follow a link someone provides me to Netflix disclosure in the form of a discrete Hastings Facebook status update, I don't seem to be able to get into his Facebook page to search or browse.) But I may have given SEC staff more credit in the matter than they are due.


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