Official Interpretation of the Code of Professional Standards for the Practice of Public Relations as it applies to Financial Public Relations
 
1. It is the responsibility of PRSA members who practice financial public relations to be thoroughly familiar with and understand the rules and regulations of the SEC and the laws it administers as well as other laws, rules, and regulations affecting financial public relations, and to act in accordance with their letter and spirit. In carrying out this responsibility, members shall also seek legal counsel, when appropriate, on matters concerning financial public relations.
 
2. Members shall adhere to the general policy of making full and timely disclosure of corporate information on behalf of clients or employers. The information disclosed shall be accurate, clear, and understandable. The purpose of such disclosure is to provide the investing public with all material information affecting security values or influencing investment decisions. In complying with the duty of full and timely disclosure, members shall present all material facts, including those adverse to the company. They shall exercise care to ascertain the facts and to disseminate only information they believe to be accurate. They shall not knowingly omit information, the omission of which might make a release false or misleading. Under no circumstances shall members participate in any activity designed to mislead or manipulate the price of a company’s securities.
 
3. Members shall publicly disclose or release information promptly so as to avoid the possibility of any use of the information by any insider or third party. To that end members shall make every effort to comply with the spirit and intent of the timely-disclosure policies of the stock exchange, NASD, and the SEC. Material information shall be made available on an equal basis.
 
4. Members shall not disclose confidential information the disclosure of which might be adverse to a valid corporate purpose or interest and whose disclosure is not required by the timely-disclosure provisions of the law. During any such period of non-disclosure members shall not directly or indirectly (a) communicate the confidential information to any other person or (b) buy or sell or in any other way deal in the company’s securities where the confidential information may materially affect the market for the security when disclosed. Material information shall be disclosed publicly as soon as its confidential status has terminated or the requirement of timely disclosure takes effect.
 
5. During the registration period, members shall not engage in practices designed to precondition the market for such securities. During registration, the issuance of forecasts, projections, predictions about sales and earnings, or opinions concerning security values or other aspects of the future performance of the company, shall be in accordance with current SEC regulations and statements of policy. In the case of companies whose securities are publicly held, the normal flow of factual information to shareholders and the investing public shall continue during the registration period.
 
6. Where members have any reason to doubt that projections have an adequate basis in fact they shall satisfy themselves as to the adequacy of the projections prior to disseminating them.
 
7. Acting in concert with clients or employers, members shall act promptly to correct false or misleading information or rumors concerning clients’ or employers’ securities or business whenever they have reason to believe such information or rumors are materially affecting investor attitudes.
 
8. Members shall not issue descriptive materials designed or written in such a fashion as to appear to be, contrary to fact, an independent third-party endorsement or recommendation of a company or a security. Whenever members issue material for clients or employers, either in their own names or in the name of someone other than the clients or employers, they shall disclose in large type and in a prominent position on the face of the material the source of such material and the existence of the issuer’s client or employer relationship.
 
9. Members shall not use inside information for personal gain. However, this is not intended to prohibit members from making bona fide investments in their company’s or client’s securities insofar as they can make such investments without the benefit of material inside information.
 
10. Members shall not accept compensation that would place them in a position of conflict with their duty to a client, employer, or the investing public. Members shall not accept stock options from clients or employers nor accept securities as compensation at a price below market price except as part of an overall plan for corporate employees.
 
11. Members shall act so as to maintain the integrity of channels of public communication. They shall not pay or permit to be paid to any publication or other communications medium any consideration in exchange for publicizing a company, except through clearly recognizable paid advertising.
 
12. Members shall in general be guided by the PRSA Declaration of Principles and the PRSA Code of Professional Standards for the Practice of Public Relations of which this Code is an official interpretation.