ASX Listing Rules Guidance Note 8 has been reissued to take account of the growing presence of social media and the complexity that social media brings to the continuous disclosure obligations of companies. Guidance Note 8 provides that listed companies are “strongly encouraged” to monitor what is being said about their company on social media forums, particularly when the company has a pending market-sensitive announcement, to ensure that information has not been leaked. The Guidance Note also confirms the requirements of ASX Listing Rule 3.1, which requires a listed entity to immediately notify ASX once it becomes aware of “any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity’s securities”. The ASX acknowledges that listed companies may use social media to their advantage as a method of keeping investors up-to-date with company information and events. However, such activities should complement continuous and periodic disclosure releases, rather than replace them. A listed company’s obligation to the ASX under Listing Rule 3.1 to disclose price-sensitive information is paramount. Disclosure to the ASX comes first before disclosure through other forums including social media.

Lesson: Listed companies need to ensure that they have given adequate disclosure of price-sensitive information to the ASX in advance of any tweets or other social media posts. A link to the ASX release may be the best way to avoid inaccurate disclosure. Further, when a market sensitive announcement is pending, or when a market sensitive transaction is close to being finalised, companies should monitor social media for signs that a transaction may no longer be confidential.