Advisors are honing their social-media savvy, with nearly 83% of firms adopting formal social media policies this year—up from 64% in 2011 and nearly double the 43% of advisors who had such policies in 2010, according to a just-released compliance survey by the Investment Adviser Association, ACA Compliance Group and Old Mutual Asset Management.
The online survey of 462 registered investment advisors, conducted from April 18 to May 17, also found that fewer firms (49%) are prohibiting the use of social media sites for business purposes, down from 54% in 2012. Forty-three percent reported that their social media testing has increased in the past year.
Since last year's survey, compliance testing has increased the most in the areas of advertising and marketing, personal trading, disaster recovery planning, and political contributions/pay to play, with 79% of firms indicating that they have not decreased compliance testing in any area.
The survey found that while 8% of firms reported detecting material compliance issues, 22% said they found none. The most common material issues were in the areas of advertising and marketing, personal trading, client guidelines and custody.
Laura Grossman, IAA's assistant general counsel, said in a statement that the survey "confirms that investment advisory compliance professionals continue to adapt their firms' compliance programs to address the progressively complex regulatory environment."