Using Social Media in Your Job Search: Look before you Tweet
Buy-side professionals and other financial job searchers should definitely take advantage of social media - so long as they're careful about what they post. Given strict company compliance rules and new FINRA guidelines, volunteering too much information can be riskier than posting none at all.
Sixty one percent of those who responded to a Pensions & Investments survey of pension funds, money managers and consultants said social media will become more important to their businesses over the year ahead. Many expected it would become more integral to the practice of recruiting younger, more Web-savvy workers and improving collaboration and discussion while helping attract and retain customers.
But job candidates must proceed with caution when it comes to information which is simply "out there forever, where everyone can see it," says executive recruiter Dave Tomer of Tomer Search Group in Boston, who runs a Linked In group for people seeking jobs in financial services.
Charles O'Neil, president of search firm Diversified Management Resources, also in Boston, agrees. He notes that compliance rules at most companie,s and at regulatory agencies like FINRA, significantly limit what employees can say about their firm or even their own qualities as a stock picker.
Saying, "I just joined Giant Investments as a portfolio manager is fine," O'Neill observes. But adding, "our year-to-date performance puts us in the top quartile among our peers," without adequate disclosure, could put you afoul of advertising compliance rules. "You're permitted to discuss performance in public communications, but you cannot simply cherry pick the data that makes you look best," he explains.
While testimonials from former supervisors and colleagues are a powerful feature online, "testimonials aren't allowed if you're a registered investment advisor," notes Susan Weiner, a CFA who writes and edits for asset management firms and teaches financial professionals how blog effectively. "Someone couldn't go in and say so-and-so delivered great performance in my portfolio," she says. "The SEC doesn't allow it."
New guidance FINRA released in January as part of Regulatory Notice 10-06 underscores the conflict. It states clearly, for instance, that a firm's suitability obligations under NASD Rule 2310 are triggered when it or one of its personnel recommends a security through a social media Web site. The latest guidelines also require any firm that communicates, or permits its associates to communicate, through social media sites must keep records of all of those communications.
They must also see to it that that "associated persons" who participate in social media sites for business purposes are properly supervised and don't present undue risks to investors.
Staying on the Right Side
Still, with a little knowhow, you can protect yourself and keep from running afoul of internal company rules as well as SEC and FINRA safeguards. Some useful tips:
(1) Don't furnish your personal profile with every last detail. "Recruiters are continually grabbing (Web) data and inputting it into databases, says Tomer. One poorly worded statement can be a disaster, given that "if you say something once it's out of the bag forever." So streamline. "You don't need to hang your laundry out for everyone to see."
(2) Do use professional sites to post information before you are in dire need of work. "I'm always trying to encourage people to put up a profile ... to start building their network before they need it," says Weiner. "If you wait until you seem too needy people may hesitate to connect with you."
(3) Do take pains to understand the metrics and rules around each of the sites you plan to use. Do you want each member of each social network group to gain access to everyone connected to you? If not, turn that particular function off. Recruiters don't want everyone in the world to know what they're up to, and most likely, neither do job hunters, says Tomer.
(4) Don't suppose that your customers' sophistication will give you immunity from consumer-focused compliance rules. "If you are an institutional investor it's assumed you have a degree of financial sophistication," observes O'Neill. "By definition, when you post commentary to social media you are putting (your information) out to everybody," he says.
(5) Do learn all you can about your employer's social media policies.