From “The Venture Alley,” a blog by DLA lawyers about business and legal issues important to Seattle-area entrepreneurs, startups, venture capitalists and angel investors.
Posted by Trent Dykes on September 20, 2010
Public companies are increasingly turning to social media to market their products and services and drive revenues. Given the sheer number of people who tweet, blog and post, the unique ability to target a message to a desired demographic and the relatively low cost of digital media marketing efforts relative to traditional advertising, such efforts are only going to increase. At many public companies, anyone from the C-level management team to the sales and marketing teams to individual employees – including those who are not designated as company spokespersons under the company’s communications policies – may be using social media to promote the company’s products and services.
The Typical Communications Policy May Predate Social Media
Most public companies have implemented policies aimed in part at (1) designating a very limited group of specific individuals who are authorized to speak publicly on behalf of the corporation, and (2) restricting certain forms of employee communications. These may include corporate communications policies, crisis communications policies, insider trading policies, investor relations policies and other policies, all of which have evolved as a matter of good corporate governance practice and in the interest of limiting liability for communications that may be attributed to the corporation.
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