The innovative use of Twitter technology by bank leadership to enhance shareholder value
The Securities and Exchange Commission granted permission for the use of social media in 2013 for dissemination of financial information. This opened the door for the use of Twitter as an additional means by which a corporations, including those in the banking industry, can implement the innovative use of technology to disseminate financial information. A problem for bank leadership is the lack of understanding of the potential enhancements to shareholder value provided by the use of Twitter technology as a means for dissemination of dividend announcements or earnings statements. This includes the both the importance of word count and semantic impact. Because permission was just recently granted, little research exist today on the impact of a corporate policy to actively use innovative technology, such as Twitter, to announce dividend or earnings statements on shareholder value. This research serves to determine the existence of a relationship between the use of Twitter as a means of dissemination and change to shareholder value. A predictive model was used to calculate the abnormal returns associated with seventeen publicly traded banks over four quarters that used Twitter as a means to dissemination information with a matching set of banks that did not use Twitter compared to the sentiment measurements. This research advances the understanding of the role RegFD compliance social media can play to disseminate financial information.
Naimi, Purdue University.
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