April 3, 2013 Sites like Twitter and Facebook are now considered legitimate ways for chief executives to communicate with their investors, but within certain limits. The Securities and Exchange Commission outlined disclosure rules for social media, saying on Tuesday that companies could use the tools to convey important information as long as they informed investors about that strategy ahead of time, DealBook’s Michael J. de la Merced reports.

The S.E.C. is clarifying how disclosure rules work in the era of social media. In December, the regulator warned Netflix over a Facebook post by the company’s chief executive, Reed Hastings, in which he congratulated his team on reaching a milestone. While the announcement was publicly available, the information was not subsequently disclosed in a securities filing or news release. The S.E.C. said at the time that the post might have violated Regulation Fair Disclosure, or Reg FD, which says companies must publish material information to all investors at once, but the agency is now letting Mr. Hastings avoid sanctions.

“After an investigation of several months, regulators said that companies could treat social media as legitimate outlets for communication, much like corporate Web sites or the agency’s own public filing system called Edgar,” Mr. de la Merced writes. “The catch is that corporations have to make clear which Twitter feeds or Facebook pages will serve as potential outlets for announcements.”

UPPING THE ANTE FOR DIRECTOR PAY  |  Two hedge funds waging prominent proxy battles, Elliott Management and Jana Partners, are planning to pay their director nominees as if they were chief executives, Steven M. Davidoff writes in the Deal Professor column. “Agitating for changes and waging proxy fights are familiar pages from the activist investor playbook. What’s different here is that each hedge fund is promising to pay its director candidates what are essentially bonuses that could run into millions of dollars, if not more.”

In the case of Elliott, which has a stake in the Hess Corporation, directors who serve for a year “will be paid an aggregate $30,000 for each percentage point the stock price of Hess outperforms a peer group of stocks over three years from January 2013,” with the potential payment topping out at $9 million for each director. For Jana, which is going after Agrium, nominees “will receive 2.6 percent of Jana’s net profit from the price of Agrium shares as of Sept. 27, 2012, if they are elected,” a payment that could run into the millions of dollars, Mr. Davidoff says.

“Not surprising, both Agrium and Hess are up in arms about the hedge funds’ plans to pay their nominees.” Still, “as long as the arrangement is disclosed and the hedge funds don’t exert any future control over the nominees, it is unlikely that this violates any state or federal law. Here, director compensation falls into the same basket as executive compensation. The examples of hedge funds paying directors are all over the place.”

WOMEN ON WALL STREET  |  In board rooms, in the executive suite, and in fields like law, technology and private equity, women are still underrepresented. “I suspect that we were simply not very good role models,” Irene Dorner, chief executive of HSBC USA, tells Andrew Ross Sorkin in DealBook’s latest special section, “Women in a Man’s World.” She continues, “And there aren’t enough of us to be visible so that people can work out how to do what we did.”

ON THE AGENDA  |  The ISM nonmanufacturing index for March is out at 10 a.m. James E. Spiotto, a partner at Chapman & Cutler, who is an expert in bankruptcy, is on Bloomberg TV at 10:30 a.m. Paul H. O’Neill, a former Treasury secretary, is on CNBC at 4:10 p.m.

VERIZON QUIETS TALK OF A DEAL  |  A blockbuster telecommunications deal is not imminent, despite talk that it might be. Verizon Communications said on Tuesday that it did not “currently have any intention to merge with or make an offer for Vodafone, whether alone or in conjunction with others.” The statement came after a report by The Financial Times’s Alphaville blog that Verizon was working with AT&T on a potential bid for the London-based Vodafone, which has a 45 percent stake in Verizon Wireless. Shares of Vodafone fell as much as 3.7 percent in London trading on Wednesday morning. Michael J. de la Merced writes: “Some future offer by Verizon may be off the table for six months, per British securities regulations, but certainly not in the long term. Verizon noted in its securities filing that it had said many times that ‘it would be a willing purchaser’ of Vodafone’s 45 percent stake in the wireless unit.”