Since returning from the annual NIRI conference, I have conducted a series of interviews with the panelists from the social media workshop: Take the Wheel and Drive Your Company’s Social Media. What follows is an interview with David Urban, Director of IR at Johnson Controls one of the two IROs on the panel.
Tell us a little about yourself.
Glen Ponczak, who is our Vice President of global investor relations, hired me as Director of investor relations at Johnson Controls about 2 years ago. We have a team approach to IR at Johnson Controls. We have been working on some new initiatives, which include social media and building out our investor relations program outside of the U.S. These initiatives are the reasons for my involvement in getting the IR Twitter channel up and running.
Prior to Johnson Controls I was with M&I bank in Milwaukee for 27 years. The last 5 years of which I was running investor relations for the bank. M&I was bought by the Bank of Montreal in July of 2010.
How long have you been using social media? What channel did you first use and why?
So far Johnson Controls’ IR social media efforts have consisted entirely of using Twitter. We launched our IR Twitter channel in March of this year. We spent 6 to 9 months conducting some pretty extensive research on how companies were using social media and wrote a strategy on how we wanted to implement social media – specifically for investor relations. We worked getting approval from senior management. We worked very closely with corporate communications. We also worked closely with General Counsel to make sure we were coordinated and we had evaluated all the risks associated with social media – especially in the investor relation’s realm.
There are a lot of regulatory issues that need to be addressed. After going through that process, we decided that we were going to use Twitter. Largely, what we are doing at this point is remarketing existing content from the Johnson Controls website and using Twitter as a way to distribute that kind of information into the hands of investors and prospects.
The key differentiator here is the corporate website is great and it can hold all kinds of information however, if you are an investor interested in Johnson Controls, you don’t necessarily know when new content is being posted to the website. Whereas, with Twitter, setting up your notifications in such a way where you get a text when there is a Tweet from @JCI_IR, the Johnson Controls IR Twitter channel, you are immediately notified of new content with a link back to that information. So that is what I think is a key value add.
We will be adding new content to the website that we will be pushing through Twitter. What we are working on right now is putting together executive interviews made up of 3-5 minute video clips in a Q&A format where we will address issues of the day that we know are on investors’ minds. It allows us to keep control of the communication process so we control the messaging and the distribution. For example, after earnings calls in particular, if it seems like there is some confusion or areas that we need to clarify we can use the video clips to do that. Let’s say whatever the issue of the day is and there always is one after an earnings release, you often find that 80% of the incoming questions are all around this same issue. By getting the message out there and in a form that can reach a wide audience very quickly, you can cut down on answering those same questions all the time and save everyone some time and effort.
Your Twitter account is specifically for investor relations, who is in charge of that channel?
There is an individual on our IR team and the Twitter channel is one of her responsibilities. She has a posting calendar that is updated every quarter where all the tweets are outlined so that every week or every other week she is sending out a Tweet and posting new content. She is also monitoring the channel so that we are able to act fast in the event that someone makes a comment and we need to follow up. Any time she wants to tweet, there are checks and balances where she has to get the approval from us in IR and our General Counsel.
From the conference, the big question was: ‘Are institutional investors using social media?’ Do you have any interaction with retail or institutional investors on Twitter?
Great question. We have been up and running for two months, we have 2500 followers already, which I think is a pretty good start. Sometimes it is hard to get a handle on who is actually following you. I know sell side analysts are, some of our institutional investors are. I would say that our knowledge into that is fairly limited at this point.
The paradox with this situation is that according to the surveys it doesn’t look like very many people are using these channels. My point was it is really kind of incumbent on the host of that Twitter channel to deliver content in an easy way that is relevant. It is about giving them better, timelier information. If I were an analyst following Johnson Controls, I would think this is great. Even as an IRO, to get a new notification every time we post new content with a link back to the website. It centralizes all the information related to the IR function in one spot, which is very convenient.
Do you have a social media policy?
We have a social media policy that comes through corporate communications. The whole company is incorporated into that policy. Corporate communications has also established social media training company wide, which every employee is encouraged to take.
I am sure you heard about the April Release for the SEC, what is your reaction to the release?
Their last release on the Internet and social media was in 2008. A lot has changed since then. I think it is great. I think that the more they comment and the more they can clarify on what the proper use of social media for public companies is, the better off we are all going to be.
We moved ahead even before their most recent release and we were comfortable doing that because we are really leveraging the corporate website. We’re not at this point providing new content via Twitter. I suppose at one point that may become appropriate disclosure given their most recent guidance. We are going to be moving slowly and we are going to be very conservative in the way that we use it. We just really think that this is the way to go.
What do you think the trend going forward will be for companies using social media for IR?
I think companies are going to use it for a way to continue to provide more transparency to investors, which is great. So to the extent that we can provide some video clips and interviews, it is really a democratic way to spread that information to everybody and I think that is a great thing.
Do you have anything else to add?
I would say that it is kind of incumbent on companies to try and develop a business case for why social media makes sense for investors. I think it is about improving the scale, quality and convenience of IR communication and I think social media and Twitter in particular can be used to improve service to shareholders and attract new investors.
Related posts:
NIRI 2013 – Social Media Workshop Follow up: Q&A – part 1
NIRI 2013 Social Media Workshop Case Study: How one buy-side analyst uses social media
NIRI 2013 – Social Media Workshop Follow up: Q&A – part 2
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