As more and more financial advisers wade into social media, the seas are still uncharted. There are still risks associated with combining the financial and social media industries.
Though many businesses are still resistant to engage via social media platforms, research has shown that if done correctly, the results can be beneficial.
Financial + Social
Fortunately, businesses have an ally in Smarsh, an organization that provides hosted solutions for archiving electronic communications, including various social media platforms. This week, Smarsh has compiled and released a series of complimentary resources designed to help organizations make informed decisions about social media usage.
Understanding the Risks & Benefits
Those in the financial industry are subject to strict regulatory standards and compliance, which if left unmet could result in increased fines and reputational damage. Various online polls have indicated that system administrators worry that employees share too much personal information via their social networking profiles, putting their corporate infrastructure and the sensitive data stored on it at risk. In addition, if companies ban social networking during work hours, employees who access them unsecurely are putting company information at risk for phishing and malware attacks.
According to the 2010 Rydex|SGI AdvisorBenchmarking Semiannual Study, 62% of Registered Investment Advisors (RIAs) think social media outreach will have a lasting impact on their businesses. In addition, the study also showed that 46% of financial advisors are looking to social media for securing new clients, while 35% see social networking platforms as a way to enhance communication with current clients and 30% see it as a way to advertise or promote their firms. Finally, 42% of advisors are already using LinkedIn, Facebook (27%), YouTube (15%) and Twitter (13%).
Resources for Social Networking Compliance
Thanks to Smarsh’s resources, financial advisors can learn more about social networking compliance standards through white papers and studies, which can help them maintain a presence online while minimizing risk.
The complimentary resource materials from Smarsh include:
- The Companion Guide to FINRA/SEC Social Networking Compliance, a white paper providing a cohesive summary of the key FINRA and SEC rules relevant to social media compliance and recommendations for how to navigate various social networks while maintaining compliance.
- Why You Need to Focus on Social Networking in Your Company, an Osterman Research white paper, which discusses the growth and importance of social media, as well as the risks associated with inadequate management of social networking in the workplace.
- Osterman Research Social Media Webinar, a panel webinar that includes representatives from Osterman Research, Smarsh and Facetime addressing the importance for companies to start managing social media and how to successfully address the risks.
These resources, along with additional information on social media compliance, are available at www.smarsh.com/socialmedia.