As of October 1, Registered Investment Advisors are required to submit new information on Form ADV. This updated two-part form is designed to provide the U.S. Securities and Exchange Commission (SEC) with more information about a firm’s services, including: whether or not they use an outsourced compliance officer, additional information about their 25 largest branches, and a list of corporate social media pages.

But listing social media pages isn’t as simple as checking off an “I use Twitter/Facebook/LinkedIn” box on a form. Firms are required to list all corporate pages—across all platforms—where advisors control the content on publicly-available, business-related social media sites. Firms are not required to report on individual, personal pages. The information must be provided on Section 1.I of Schedule D.

What can you do before October 1?

If you haven’t put together a comprehensive list of your active business-related social media pages, start. The last thing you want to be is unprepared if and when the SEC comes calling.

When compiling your list, take the time to closely review how your firm and advisors use social media, and make sure your social media policy is updated and ready for inspection. Your policy should detail how your advisors are allowed to use social media, which platforms or accounts are authorized for use, who is responsible for monitoring the accounts, and the consequences for violating the policy. Don’t forget to train your advisors on how to properly and safely use social media when representing your firm.

If your firm is selected for an SEC examination or audit, you will also need to prove your firm has the proper recordkeeping systems in place to retain communications. Your compliance team needs an efficient way to supervise content, and correct errant or misleading communications—and their creator—if needed. To mitigate risk, your archiving solution should be able to reproduce social media content in its original context, alongside other content that might be a part of the overall communications, such as emails, text messages, and photos. This allows compliance officers and regulators to see and understand the context, timing, and additional details related to specific communications between an advisor and its prospects and clients.

What can firms expect in the future?

It is safe to say we will see an increase in regulatory actions for social media violations in the coming year. The updating of Form ADV signals the SEC is aware that nearly all firms and advisors are using social media to promote their business and reach out to potential and existing clients. Without oversight, there is the potential for advisors to face heavy fines—or in the most egregious scenarios, being banned altogether.

The specific inclusion of social media also signifies the SEC will heavily scrutinize an advisor’s corporate social media accounts during an examination or audit, as stated in the final Form ADV and Investment Advisers Act Rules. For a list of frequently asked questions about Form ADV, visit sec.gov.