[SEC Chairman Christopher] Cox also is expected to put up for final vote Wednesday a proposed rule that would enable companies to create online shareholder forums where investors and management could exchange thoughts, establishing a kind of chat room to improve communication. Opposing that model is the AARP, the lobby group for adults 50 and older, which said its studies show that doing so would result in fewer of its members participating in shareholder elections.
A couple of thoughts spring to mind here:First, it's interesting to see the SEC accepting online forums as a new means for official investor-to-management communications. Web 2.0 features like online forums are fast becoming prevalent on financial services firms' sites - in the past two months alone, we've seen American Express, Bank of America and TD Ameritrade add Web 2.0 features to their websites. With the SEC now proposing a rule specifically geared toward sanctioning online forums, it seems that Web 2.0 functionalities are quickly moving beyond "next big thing" status and gaining a permanent foothold in the financial services industry.
It's equally interesting to note that it's the American Association for Retired Persons that opposes the SEC's proposed rule, not a regulatory body like FINRA. AARP's argument - that the new online forums would deter some of its members from participating in shareholder elections, presumably because they would be unaware of discussions that occurred in the online forums - is a valid (if somewhat convoluted) sticking point. After all, what good is a service if key users can't (or won't) utilize it?
This issue, of course, will be less pressing in the future as greater segments of the population grow computer- and Internet-savvy. But so long as Baby Boomers and the Greatest Generation lead the way in terms of investable assets, the push and pull between old-school reliability and new-school efficiency is something that brokerages, regulatory bodies, etc. will be forced to contend with.As long as Baby Boomers and the Greatest Generation lead the way in terms of investable assets, the push and pull between old-school reliability and new-school efficiency is something that brokerages, regulatory bodies, etc. will be forced to contend with.