A Social Divide in the City I
Twitter for Financial Reporting Performance Index
At a time when investors say they find digital communications more insightful and more motivating than traditional communications, such as press releases, our analysis shows that only a small number of the FTSE 100 are effectively using Twitter to support their financial communications.
2013 brought into focus just how social media can move markets and impact on reputation and it comes as no surprise to find 90 percent of FTSE 100 companies are active in some capacity on Twitter, the principal social media channel for news and corporate communications. Examine the UK's largest quoted companies more closely, however, and you’ll find new patterns emerging around Twitter as a financial communications tool.
Indeed the leaders in this area have gone further by using LinkedIn, YouTube and a variety of creative and rich media to bring their corporate stories to life. Meanwhile other companies are losing share of voice and their communications remain analogue in a digital world.
More than half (52 percent) of FTSE 100 companies used Twitter to share their latest, half, or full year results in 2013, amounting to 431 results related tweets overall, some supporting a positive narrative and others helping to defend below expected numbers.
Just as 40 percent of global institutional investors seek information from third-party influencers via social media and 13 percent of investors look for information directly from companies on social channels, half of all companies in the FTSE 100 are not using Twitter as a results communication tool. This represents a lost opportunity to exert influence on key stakeholders and maintain control at critical times.
This research paper was completed by FTI Consulting in December 2013, and covers an analysis of tweets published by companies in the FTSE 100 on the day of their most recent annual or half-year results announcement. The research aims to balance the requirement for comparing like with like and the need for up-to-date data. In light of this, the authors acknowledge that comparing one company’s full-year results announcement with another company’s half-year results announcement is not a perfect comparison, but it does mean that no data is more than six months old.
The data covers the most recent set of annual or half-year results for each company prior to Dec. 23, 2013. The companies included were the constituents of the FTSE 100 index prior to this date (i.e., the research includes Croda and Vedanta, and excludes Ashtead and Royal Mail). Only tweets on the day of the results announcement are included in the quantitative data, though we do note elsewhere in this research paper that some companies tweet about their results in the days preceding and following the actual announcement. Similarly, only tweets directly related to the results announcement have been included.
The tweets analyzed as part of this research are those by official company Twitter accounts. For the companies that published one or more results-related tweets we have included the Twitter handle in the table on pages 10–11. The research is based solely on publicly available online information and not on any interviews with any of the FTSE 100 companies.
Senior Managing Director