For regulated firms, like others, social media offers a valuable marketing channel. Platforms like Twitter and Linkedin provide a highly-measurable way to get marketing messages out quickly to a wide audience. They can be ideal for sharing thought leadership material, new product information, news and other messages.
But social media is classed as a ‘non-real time’ financial promotion by the Financial Conduct Authority (FCA). And as a result, comes with all the regulatory compliance requirements of any other financial promotion.
Your social media posts need to be reviewed, approved and stored in the same way as your other marketing communications. Their content needs to comply with FCA guidelines.
This can create challenges for regulated firms. The desire to benefit from social media’s opportunities has to be tempered by the need for compliance. Its immediacy is one of its key benefits – but can also be a potential pitfall when it comes to ticking the regulator’s boxes.
Social media tips for Compliance teams
Here we set out 10 tips for Compliance professionals who want to help their firm use social media in an effective and compliant way.
- Create a clear social media policy
Who can post on your firm’s behalf? What can they say? What kind of content are you going to post, and how often? What are the firm’s messages on key topics?
You need to make sure you have a clear and consistent policy, not just for corporate accounts but covering employees’ personal social media as well.
- Make sure everyone has the right training
Do people know who can post on the firm’s behalf? Do they know your rules around social media content, and understand the regulatory limitations?
Put in place a training programme that is mandatory before anyone represents the firm on social media.
- Content has to be fair, clear and not misleading
Creating ‘fair, clear and not misleading’ social media content can be tricky. Nuances are difficult to convey in a character-limited environment. Twitter allows only 140 characters; Linkedin and Facebook give a little more leeway.
But because social media is subject to the same requirements as other financial promotions, you need to make sure you are not saying anything ambiguous or misleading just because you don’t have many words to play with.
You can help your Marketing team (or anyone else in the firm who posts social media content) to understand how their posts can meet the FCA’s requirements. Doing this will minimise the amount of posts you have to reject, and the time your team or digital agency spends rewriting.
- Help your business to understand the FCA’s stance on risk warnings
In March 2015, the FCA updated its social media guidance. One of the main changes was around risk warnings, which the FCA says apply to social media in the same way as they do in any other medium.
Understanding what this means in practice, and helping your Marketing team with training, guidelines and suggestions, is essential for compliant social media. The FCA guidance gives some good examples of tweets that would be compliant and non-compliant under this new rule, which might be useful to refer to.
- Encourage your business to consider whether social media is the best channel
Sometimes social media, with its immediacy and limited characters, is not the right channel for the message you want to convey. Again, Compliance can take an advisory role here, helping your business to understand the limitations of social media for certain messages, and advising on alternative channels.
- Make sure the need for compliance approval is understood
The FCA’s approach is ‘media-neutral’ – meaning they expect the same level of approvals documentation and evidence for social media as they do for brochures or other marketing materials.
Ensure your business realises this, and factors Compliance team review into their publishing schedule. Efficient processes are a huge help here: social media is intended to be reactive and quick-fire. An approvals process that takes hours or even days isn’t going to hit the mark. Work with your Marketing team to build a procedure that works for everyone. Introducing a level of automation to the compliance review process can speed it up and reduce the opportunity for error.
- Treat hashtags with caution
The 2015 guidance from the FCA sounds a note of caution on hashtags. Previously, the word #Ad was suggested to signify promotional tweets. The updated guidance repeals this, and also has guidance on hashtags as a whole. As a Compliance team, you will need to be familiar with these so you can explain them to your business.
- A social media post is classified as a ‘non-real time’ promotion
Because the FCA’s rules on ‘real-time financial promotions’ (for example, conversations with clients) are different to those for ‘non-real time’ ones such as brochures or emails, this means that social media posts need to be treated with the same rigour as printed materials.
Again, the Compliance role in educating the Marketing team and your firm on this will be important.
- Understand the rules on retweeting, sharing and liking
In their new guidance, the FCA states that if a firm retweets, shares, favourites or likes a consumer’s post, they may fall under the financial promotions rules. You therefore need to take the same approach to approvals and documenting of retweets, likes, shares or favourites as you do to original social media posts.
- All social media messages should be archived
Documenting financial promotions and their approvals process is vital to meeting the FCA’s requirements. The seemingly transient nature of social media often means people forget that they need to document and archive social media posts in the same way you would adverts or brochures. The FCA uses its updated guidelines as an opportunity to reinforce this message. You need to understand what constitutes compliant storage and archiving and ensure everyone responsible for social media is abiding by these rules.
Remember: Not everything is black and white when it comes to Financial Promotions, and many of the rules are open to interpretation. If you are unsure how your activities fit within the rules, please contact us.
How can we help?
At LS Consultancy, we offer a number of distinct products and services which can be deployed individually or combined to form a broader solution.
When you face business or regulatory challenges, we can provide solutions that are tailor-made to your needs with a view to releasing your energies to focus on your clients.
We work both within individual teams and across many departments to offer a complete solution, with a range of cost effective, compliance and marketing solutions including social media which are uniquely suited to supporting firms.
Connect with us via social media and drop us a message from there. We’d love to hear from you and discuss how we can help.